Management Board Report on Santander Bank Polska Group Performance in 2023
(including Report on Santander Bank Polska S.A. Performance)
2
CONTENTS
I. Overview of activities of Santander Bank Polska S.A. and its Group in 2023 5
1. Introduction ............................................................................................................................................................................................................... 5
2. Key achievements ..................................................................................................................................................................................................... 5
3. Financial and business highlights of Santander Bank Polska Group for 2019–2023 ............................................................................................. 7
4. Key external factors .................................................................................................................................................................................................. 8
5. Corporate events ....................................................................................................................................................................................................... 8
II. Basic information about the Bank and Santander Bank Polska Group 11
1. History, ownership structure and profile ............................................................................................................................................................... 11
2. Structure of Santander Bank Polska Group ............................................................................................................................................................ 16
III. Macroeconomic situation in 2023 18
IV. Development strategy 22
1. Purpose, aim, values and strategic objectives ....................................................................................................................................................... 22
2. Ambitions for 2021–2023 and delivery of the strategy ........................................................................................................................................ 27
3. Corporate culture .................................................................................................................................................................................................... 31
4. Forecast of economic situation in 2024 ................................................................................................................................................................. 33
V. Relations with employees 34
1. Human capital ......................................................................................................................................................................................................... 34
2. Remuneration policy and bonus schemes .............................................................................................................................................................. 35
3. HR policy .................................................................................................................................................................................................................. 39
4. HR development directions .................................................................................................................................................................................... 40
5. Training and development ...................................................................................................................................................................................... 42
Relations with customers 43
1. Service quality and customer experience management ........................................................................................................................................ 43
2. Complaints management ....................................................................................................................................................................................... 45
3. Barrier-free banking and digital solutions ............................................................................................................................................................. 45
4. Customer relationship management solutions ..................................................................................................................................................... 46
VII. Investor relations 47
1. Investor relations at Santander Bank Polska S.A. .................................................................................................................................................. 47
2. Share capital, ownership structure and share price ............................................................................................................................................... 47
3. Share price of Santander Bank Polska S.A. vs the market ..................................................................................................................................... 48
4. Dividend ................................................................................................................................................................................................................... 49
5. Rating of Santander Bank Polska S.A. .................................................................................................................................................................... 50
VIII. Relations with external environment 52
1. Responsible Banking/ ESG Strategy ....................................................................................................................................................................... 52
2. Environmental impact of operations ...................................................................................................................................................................... 52
3. Communication with stakeholders ........................................................................................................................................................................ 52
4. Social responsibility ................................................................................................................................................................................................ 55
IX. Business development in 2023 56
1. Group’s business management structure .............................................................................................................................................................. 56
2. Business development of Santander Bank Polska S.A. and non-banking subsidiaries ........................................................................................ 58
3. Business development of Santander Consumer Bank Group ................................................................................................................................... 70
Management Board Report on Santander Bank Polska Group Performance in 2023
(including Report on Santander Bank Polska S.A. Performance)
3
X. Organisational and infrastructure development 73
1. Organisational changes in Santander Bank Polska S.A. ........................................................................................................................................... 73
2. Organisational structure of Santander Consumer Bank S.A. .................................................................................................................................... 75
3. Changes in the structure of Santander Bank Polska Group ...................................................................................................................................... 76
4. Changes in the equity investment portfolio .............................................................................................................................................................. 76
5. Development of distribution channels of Santander Bank Polska S.A. ................................................................................................................. 78
6. Development of distribution channels of Santander Consumer Bank S.A. ........................................................................................................... 81
7. IT development ....................................................................................................................................................................................................... 81
8. Capital expenditure ................................................................................................................................................................................................. 84
XI. Financial performance in 2023 85
1. Consolidated income statement................................................................................................................................................................................ 85
2. Consolidated statement of financial position ........................................................................................................................................................... 96
3. Selected financial ratios of Santander Bank Polska Group ..................................................................................................................................... 101
4. Separate income statement .................................................................................................................................................................................... 102
5. Separate statement of financial position ................................................................................................................................................................ 107
6. Selected ratios of Santander Bank Polska S.A. ........................................................................................................................................................ 109
7. Additional financial information about Santander Bank Polska S.A. and Santander Bank Polska Group ............................................................. 109
8. Factors affecting the financial performance in 2024 .............................................................................................................................................. 111
XII. Risk and capital management 112
1. Key risk management principles and structure in the Bank and in Santander Bank Polska Group ...................................................................... 112
2. Risk management priorities in 2023 ....................................................................................................................................................................... 114
3. Material risk factors expected in the future ............................................................................................................................................................ 116
4. Credit risk management .......................................................................................................................................................................................... 117
5. Market risk and liquidity risk management ............................................................................................................................................................ 127
6. Operational risk management ................................................................................................................................................................................. 130
7. ESG risk management .............................................................................................................................................................................................. 132
8. Legal and compliance risk management................................................................................................................................................................. 134
9. Capital management............................................................................................................................................................................................. 136
XIII. Statement on corporate governance in 2023 140
1. Corporate governance at Santander Bank Polska S.A. ......................................................................................................................................... 140
2. Issuer’s securities .................................................................................................................................................................................................. 152
3. Amendment of the Statutes of Santander Bank Polska S.A. ............................................................................................................................... 153
4. Governing bodies .................................................................................................................................................................................................. 154
5. Management of ESG issues (including ESG risk) ................................................................................................................................................. 178
6. Remuneration policy ............................................................................................................................................................................................. 180
7. Other transactions with executives ...................................................................................................................................................................... 187
8. Diversity Policy ...................................................................................................................................................................................................... 187
9. Internal control and risk management systems for financial reporting ............................................................................................................. 190
10. External auditor ..................................................................................................................................................................................................... 192
XIV. Statement on non-financial information in 2023 196
1. Business model, strategy and key performance indicators ................................................................................................................................. 196
2. Responsible banking ............................................................................................................................................................................................. 200
3. Risk management system ..................................................................................................................................................................................... 203
4. Environmental policies and their outcomes ......................................................................................................................................................... 205
5. Anti-corruption policies and their outcomes ........................................................................................................................................................ 239
6. Human rights policies and their outcomes .......................................................................................................................................................... 242
7. Employee policies and their outcomes ................................................................................................................................................................ 244
8. Diversity policy and its outcomes ......................................................................................................................................................................... 251
Management Board Report on Santander Bank Polska Group Performance in 2023
(including Report on Santander Bank Polska S.A. Performance)
4
9. Customer experience management policy........................................................................................................................................................... 253
10. Social policies and their outcomes ....................................................................................................................................................................... 254
XIV. Statement of the Management Board 262
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
5
I. Overview of activities of Santander Bank Polska
S.A. and its Group in 2023
1. Introduction
Scope
This Management Board Report on Santander Bank Polska Group Performance in 2023 contains the information required in both consolidated and
separate Management Board reports on Santander Bank Polska S.A. performance.
Performance of Santander Bank Polska Group vs the commercial banking sector
Despite the weaker economic environment and high geopolitical uncertainty, 2023 was another year of an increasing profitability of the Polish banking
sector, as reflected by steadily growing ROE and ROA.
As indicated by the statistics of the Financial Supervision Authority (KNF), the total net profit posted by the Polish commercial banks as at the end of
November 2023 was PLN 25.4bn and increased by 158,9% YoY. This performance was attributed mainly to significantly higher interest income, which
grew by PLN 45,1bn despite the start of monetary policy easing by the National Bank of Poland (NBP) in September 2023. On the other hand, the financial
results of banks for 2023 were most adversely affected by additional provisions for legal risk connected with foreign currency mortgage loans, costs and
depreciation/amortisation as well as net expected credit loss allowances.
The above market trends are reflected in the performance of Santander Bank Polska Group.
In 2023, the consolidated profit attributable to shareholders of the parent entity increased by 72.6% YoY on account of a 35.9% YoY rise in net interest
income. The profitability was also supported by higher net fee and commission income (+5.9% YoY) and higher net trading income and revaluation and
gain on other financial instruments (+PLN 197.8m in total).
Negative factors included an increase in the cost of legal risk and settlements in respect of CHF mortgage loans (+52.0% YoY) and higher net expected
credit loss allowances (+28.5% YoY).
In 2023, Santander Bank Polska Group reported growth in its key business volumes, including an increase of 4.3% YoY in gross loans and advances to
customers and a rise of 6.5% YoY in deposits from customers.
2. Key achievements
EFFICIENCY AND
SECURITY
Group’s solid capital position confirmed by capital ratios as at 31 December 2023, including total capital
ratio of 18.56% (19.74% as at 31 December 2022).
Higher ROE YoY (20.3% vs 11.9% as at 31 December 2022).
Sound liquidity position. Net customer loans to deposits ratio at 76.2%.
Supervisory liquidity ratios well
above the regulatory minimum.
Close monitoring of risk and implementation of relevant prudential measures.
Improved cost efficiency supported by high income growth rate. Decline in the cost-to-
income ratio from
37.9% to 29.5% in 2023.
Further automation and optimisation of operational processes.
Improved availability, reliability, performance and cybersecurity of the Group’s systems.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
6
BUSINESS VOLUMES
AND ASSET QUALITY
7.4% YoY increase in total assets to PLN 276.7bn.
6.5% YoY growth in deposits from customers to PLN 209.3bn reflecting a dynamic increase in term
deposits (+13.9% YoY) and a moderate rise in current account balances (+3.7% YoY).
4.3% YoY increase in gross loans and advances to customers to PLN 165.2bn, including loans to business
customers and the public sector (+5.9% YoY), lease receivables (+11.8% YoY) and loans and advances to
individuals (+1.9% YoY).
Improved quality of the credit portfolio, reflected by a decrease in the NPL ratio from 5.0% as at 31
December 2022 to 4.6% as at 31 December 2023.
Growth in the annualised net interest margin from 4.31% for 2022 to 5.39% for 2023, supported by an
increase in business volumes.
5.9% YoY rise in net fee and commission income on account of higher net income from banking activities
and from stock trading and investment funds.
Growth in the number of transactions made via mobile banking in 2023 (+27.1% YoY) and in the share of
this channel in remote credit sales.
CUSTOMERS AND
COMMUNITIES
7.5m customers of Santander Bank Polska S.A. and Santander Consumer Bank S.A., including 3.6m loyal
customers.
5.3% increase in the number of customer accounts to 6.6m, including 3.7m Santander Accounts.
4.2m digital customers of both banks, including 3.0m mobile banking customers.
Further automation, robotisation, optimisation and simplification of operational processes.
Continuation of IT projects aimed at improving experience of customers and employees.
Continuation of the special offer for Ukrainian citizens.
Implementation of measures to support sustainable development and promote cybersecurity culture.
Enhancement of functionality of remote channels (e.g. introduction of instant payments on One Trade
Portal and launch of the new Santander mobile application with a new design, additional features and
better personalisation options).
First edition of the grant programme for local governments: “Together for Eco-
Change”, financing
electric car charging stations.
AWARDS
the Equal Company Code of Best Practice.
The best mobile application for business customers according to SME Banking Club.
Eurobuild Award –
row in Eurobuild Awards organised by Eurobuild CEE, a property market magazine.
proposition) as well as responsiveness to customer needs and sales performance.
First position in the “Best Bank for SMEs in Poland” category of Euromoney Awards for Excellence.
based on the mystery shopping results.
The Best Annual Report 2022 –
and special award for the best sustainability report.
CSR Golden Leaf from Polityka magazine –
development is a strategic element of doing business and building relations with stakeholders.
“Great Place To
performance based on the innovation and ESG questionnaire.
Diversity IN Check –
management (granted to the Bank for the third time).
indicators.
and foster good relationships within the organisation.
HR practice survey.
the category of ECP managing companies.
Alfa awards for the best investment funds in 2022 granted to six Santander TFI S.A. sub-
TFI S.A. itself by Analizy Online
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
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3. Financial and business highlights of Santander Bank Polska Group for
2019–2023
Key financial data of Santander Bank Polska Group for the last five years
Selected income statement items
2023 2022
1)
2021
2)
2020 2019
YoY change
(2023/2022)
Total income
PLN m
15,992.3
12,381.5
9,141.6
8,647.3
9,462.1
29.2%
Total costs
PLN m
(4,715.0)
(4,697.7),
(3,988.3)
(4,488.0)
(4,466.3)
0.4%
Net expected credit loss allowances PLN m
(1,149.4)
(894.7) (1,124.2) (1,762.8) (1,219.4)
28.5%
Profit before tax PLN m
6,850.0
4,353.0 2,057.8 1,880.9 3,244.6
57.4%
Profit attributable to the shareholders of Santander
Bank Polska S.A.
PLN m
4,831.1
2,799.1 1,111.7 1,037.2 2,138.3
72.6%
Selected balance sheet items
31.12.2023 31.12.2022 31.12.2021
1)
31.12.2020 31.12.2019
YoY change
(2023/2022)
Total assets
PLN m
276,651.9
257,517.2
243,017.3
228,748.9
209,476.2
7.4%
Total equity PLN m
33,691.0
28,465.3 27,213.6 28,658.0 26,979.5
18.4%
Net loans and advances to customers
PLN m
159,520.0
152,508.7
146,391.3
141,998.8
143,402.6
4.6%
Deposits from customers
PLN m
209,277.4
196,496.8
185,373.5
171,522.3
156,480.3
6.5%
Selected off-balance sheet items
31.12.2023 31.12.2022 31.12.2021
1)
31.12.2020 31.12.2019
YoY change
(2023/2022)
Net assets of investment funds
3)
PLN bn
18.9
12.3 17.6 16.2 16.9
53.7%
Selected ratios
4)
31.12.2023 31.12.2022 2021
1)
2020 2019
YoY change
(2023/2022)
Costs/Income
%
29.5%
37.9%
43.6%
51.9%
47.2%
-8.4 p.p.
Total capital ratio %
18.56%
19,74% 19.05% 20.42% 17.07%
-1.2 p.p.
ROE
%
20.3%
11.9%
4.7%
4.4%
9.7%
8.4 p.p.
Basic earnings per share
PLN
47.28
27.4
10.9
10.2
21.0
19.88
Book value per share PLN
329.69
278.56 266.3 280.4 264.3
51.13
NPL ratio
%
4.6%
5.0%
5.0%
5.8%
5.2%
-0.4 p.p.
Cost of credit risk
%
0.72%
0.59%
0.76%
1.21%
0.85%
0.13 p.p.
Loans/Deposits %
76.2%
77.6% 79.0% 82.8% 91.6%
-1.4 p.p.
Key non-financial data of Santander Bank Polska Group for the last five years
Selected non-financial data
2023 2022 2021
1)
2020 2019
YoY change
(2023/2022)
Number of shares item
102,189,314
102,189,314 102,189,314 102,189,314 102,088,305
0.0
Dividend paid
5)
PLN
23.3
2.7
2.16
-
19.7
20.6
Electronic banking users
6)
m
6.4
6.3 5.7 5.4 4.4
0.1
Active digital customers
7)
m
4.2
3.6
3.2
2.9
2.5
0.6
Active mobile banking customers
m
3.0
2.7
2.4
2.0
1.6
0.3
Debit cards m
4.8
4.6 4.4 4.3 4.2
0.2
Credit cards
m
0.9
0.9
1.1
1.2
1.3
0.0
Customer base m
7.5
7.4 7.2 7.1 7.2
0.1
Branch network
locations
369
385
450
562
665
-16
Santander Zones and off-site locations
locations
17
16
13
12
10
1
Partner outlets locations
421
433 435 380 317
-12
Employment
FTEs
11,471
11,309
11,323
12,616
13,579
162
1) Pursuant to the KNF’s recommendation, in Q4 2023 Santander Bank Polska S.A. retrospectively reversed the effects of the reclassification of financial assets made in 2022 and classified again the portfolio of
selected bonds as financial assets measured at fair value through other comprehensive income. The reversal of the reclassification resulted in a decrease of PLN 12,343.3m in debt investment financial assets
measured at amortised cost as at 31 December 2022 and an increase of PLN 10,306.3m in debt investment financial assets measured at fair value through other comprehensive income. At the same time, deferred
tax assets of PLN 387.0m were recognised. The total impact on the statement of financial position was negative at PLN 1,650m.
2) As of 1 January 2022, the Group changed the accounting policy rules for recognition of legal risk connected with foreign currency mortgage loans, which is now measured and presented in accordance with IFRS 9
(previously: IAS 37). The Group reduces the gross carrying amount of mortgage loans in line with IFRS 9. If there is no exposure to cover the estimated provision or the existing exposure is insufficient, the provision
is recognised in accordance with IAS 37.
3) Assets in investment funds managed by Santander Towarzystwo Funduszy Inwestycyjnych S.A.
4) For definitions of ratios presented in the table above, see Chapter XI “Financial performance in 2023”, Part 3 “Selected financial ratios of Santander Bank Polska Group”.
5) For more information about the dividend, see Chapter VII “Investor relations”.
6) Registered users with active access to internet and mobile banking services of Santander Bank Polska S.A. and Santander Consumer Bank S.A.
7) Active users of electronic banking services of Santander Bank Polska S.A. and Santander Consumer Bank S.A. who at least once used the services in the last month of the reporting period.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
8
4. Key external factors
Key macroeconomic factors impacting financial and business performance of Santander Bank Polska Group in 2023
Economic growth
No clear rebound of economic activity in the first half of the year. Persistently weak economic conditions in Europe
affecting Polish exports.
Labour market
Unemployment rate at record low level. Continued double-digit wage growth.
Inflation
Unexpectedly fast decline in inflation in terms of fuel, energy and food prices.
Clear but gradual decrease in the core CPI.
Monetary policy
Sharp interest rate cut by the NBP in September, surprising the market. Possible further monetary easing hinted by
the MPC in the case of continued decline in inflation, followed by a rapid change in the rhetoric in November and
December putting a stop to interest rate cuts.
Fiscal policy
Worse state budget performance compared to the previous year. Very low income to GDP ratio. Average income from
VAT at a mere few percent for the majority of the year despite high inflation and reintroduction of standard VAT rate
on energy.
The draft budget for 2024 indicating higher projected general government deficit in 2023 (5.2%) as well as high deficit
(4.5%) and a clear increase in public debt in 2024.
Credit market
Increased demand from households and record high monthly sales of mortgage loans in late 2023 caused by the 2%
Safe Mortgage government programme. A rise in the demand for consumer loans during the year.
Financial markets
High volatility of debt markets amid changing expectations as to global inflation and monetary policy; market concerns
over rising yields of US bonds; shifts in pricing in interest rate cuts in Poland following the surprising decision of the
Monetary Polic
y Council in September; movements caused by prospects of Poland’s record high borrowing needs in
the next year.
Polish zloty clearly gaining in value in the first half of the year, including when compared to other emerging market
currencies, and holding steady thereafter despite volatile global sentiment and record low EUR/USD rate this year;
clear PLN sell-off caus
ed by the MPC’s interest rate cut in September followed by strong appreciation on the results of
parliamentary elections in Poland.
5. Corporate events
Major corporate events in the reporting period until the release date of the report for 2023
General Meetings
By the release date of the report for 2023, the following General Meetings of Santander Bank Polska S.A. were
convened:
The Extraordinary General Meeting (EGM) of 12 January 2023, which authorised the Management Board to buy
back the Bank’s shares for the purpose of Incentive Plan VII and established a capital reserve for that purpose.
The EGM also introduced changes to AGM
Resolution no. 30 of 27 April 2022 on the rules of the incentive plan,
assessed the effectiveness of the Supervisory Board and presented changes made by the Supervisory Board to
the Policy on Suitability Assessment of Supervisory Board Members in Santander Bank Polska S.A. and to the
Terms of Reference of the Supervisory Board of Santander Bank Polska S.A.
The Annual General Meeting (AGM) of 19 April 2023, which, apart from transacting ordinary business, approved
changes to the Bank’s Statutes, authorised the Management Board to buy back shares as part of Incentive Plan
VII and gave its consent for establishing a capital reserve for that purpose. The AGM distributed the profit for 2022
in line with the Management Board’s recommendation presented below and informed the participants about the
progress in the buyback process.
The EGM of 20 July 2023, which approved the results of the collective suitability assessment of the Supervisory
Board and of the individual suitability assessment of Adam Celiński, a candidate for a Supervisory Board member.
The EGM appointed Supervisory Board members (joined by Adam Celiński) for a new term of office. It also
determined the remuneration of Supervisory Board members and presented changes to the Terms of Reference
of the Supervisory Board.
The EGM of 11 January 2024, which amended the AGM resolution of 19 April 2023 authorising the Management
Board to buy back the Bank’s shares for the purpose of Incentive Plan VII by setting a new maximum price of own
shares subject to buyback. It also amended the Bank’s Statutes and presented changes to the Terms of Reference
of the Supervisory Board.
Registration of changes
to the Statutes approved
by the AGM
On 15 May 2023, the District Court for the capital city of Warsaw in Warsaw, 13th Commercial Division of the National
Court Register, registered the following changes to the Bank’s Statutes approved by the Bank’s AGM of 19 April 2023:
A new provision stating that the redemption, buyback or cancellation of own shares is subject to consent of the
KNF.
Changes to the criteria which must be met for written resolutions to be deemed effective (all members must be
informed about the contents of the draft resolution and at least half of the members must participate in the
adoption of the resolution).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
9
Major corporate events in the reporting period until the release date of the report for 2023 (cont.)
Individual
recommendation of the
KNF with regard to
satisfaction of the criteria
for payment of a dividend
from the net profit
earned in 2022
On 17 March 2023, the Management Board of Santander Bank Polska S.A. received an individual recommendation
from the KNF with regard to the Bank’s dividend policy.
According to the KNF, as at 31 December 2022 the Bank met the basic criteria of the Dividend Policy to pay a dividend
up to 100% of its net profit earned in 2022. Additionally, given the quality of the Bank’s loan portfolio measured as the
share of NPLs in the total portfolio of receivables from the non-
financial sector, the potential dividend payout ratio
was kept at 100%. The Bank’s receivables arising from foreign currency home loans to households did not account for
more than five per cent of the above-mentioned portfolio.
Taking into account the uncertainty related to the macroeconomic situation, in particular: (a) dynamic changes in the
banking sector’s environment; (b) risks the Bank is exposed to, including the risk related to pending judgment of the
Court of Justice of the European Union (CJEU) in case C-
520/21; (c) potential deterioration of credit quality due to
increased inflation, economic slowdown and high debt service costs for borrowers; and having regard to the need to
ensure the stability of the Bank’s business and growth, the KNF recommended that the Bank:
should not pay out a dividend from the profit for 2022:
until the CJEU issues its judgment in case C-
520/21 regarding the reimbursement of additional costs in
excess of the funds paid out in performance of the CHF loan agreement invalidated on grounds of unfair
clauses;
until the Bank consults the supervisory authority after the CJEU issues the above-mentioned judgment;
consult the supervisory authority before taking any other measures which could reduce its own funds (in
particular if they go beyond the scope of the ordinary business and operational activity), including the distribution
of the profit retained in previous years or buyback or redemption of the Bank’s shares.
Profit distribution and
dividend payment
Pursuant to the recommendation of the Management Board of Santander Bank Polska S.A. of 22 March 2023
(approved by the Supervisory Board and the General Meeting), the Bank’s profit was distributed as follows:
the profit of PLN 2,449.0m for 2022 was allocated to:
the capital reserve (PLN 72.4m);
the dividend reserve (PLN 2,376.7m);
the profit of PLN 840.9m earned on the sale of shares in AVIVA insurance companies was allocated to the dividend
reserve.
The profit distribution took into account the macroeconomic environment as well as the recommendations and then-
current stance of the KNF.
On 25 October 2023, the Management Board of Santander Bank Polska S.A. received a letter from the KNF in which
the supervisory authority stated that it had analysed the business and financial standing of the Bank and the arguments
presented by the Bank and
did not have any reservations concerning the payment of a dividend (interim dividend) of
PLN 2,375.9m from the profit earned in 2022 reduced by the amount allocated to the capital reserve and the amount
to be deducted to ensure that the dividend amount is expressed in full grosz (one hundredth of the zloty).
On 16 November 2023, the Bank’s Management Board received the Supervisory Board’s approval for payment of an
interim dividend of PLN 23.25 per share. The interim dividend was paid on 29 December 2023. For more information,
see Part 4 of Chapter VII “Investor Relations”.
Changes to the
Supervisory Board
composition
On 6 June 2023, John Power resigned as a member of the Supervisory Board of Santander Bank Polska S.A. (effective
as of 1 August 2023) due to his decision to retire.
On 20 July 2023, the remaining members and Adam Celiński were appointed for a new three-year term of office
(effective as of 1 August 2023).
Changes to the
Management Board
composition
On 4 April 2023, the Supervisory Board of Santander Bank Polska S.A. adopted a resolution appointing Magdalena
Proga-Stępień as a Management Board member, effective immediately.
On 26 October 2023, María Elena Lanciego Pérez resigned as a member of the Management Board (effective as of 1
January 2024) to take up another role in Santander Group.
On November 14, 2023, the Supervisory Board of the Bank appointed Artur Głembocki as a Member of the Bank's
Management Board in charge of the Compliance and Counteracting Financial Crime Division as of November 14, 2023.
As a result of this resignation, on 13 December 2023 the Bank’s Supervisory Board appointed Wojciech Skalski as a
Management Board member (effective as of 1 January 2024).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
10
Major corporate events in the reporting period until the release date of the report for 2023 (cont.)
Establishment of the
bond issue programme
and the issue of bonds
On 31 January 2023, the Management Board of Santander Bank Polska S.A. adopted a resolution on the establishment
of the bond issue programme with the maximum total nominal value of PLN 5bn. The bonds:
will be offered in Poland and will not require preparation of a prospectus or base prospectus.
will be offered exclusively to investors that are eligible counterparties or professional clients.
can be unsubordinated bonds or subordinated bonds (T2 bonds representing Tier 2 capital instruments) or bonds
which are eligible liabilities (MREL bonds).
will be denominated in PLN and the nominal value of one bond will be no less than PLN 1k or a multiple of this
amount, with the nominal value of one T2 bond and one MREL bond amounting to at least PLN 500k.
will bear a floating interest rate determined through bookbuilding.
will be dematerialised and will be registered with the Central Securities Depository of Poland (Krajowy Depozyt
Papierów Wartościowych S.A.).
once admitted, will be traded in an alternative trading system of the Warsaw Stock Exchange (Giełda Papierów
Wartościowych w Warszawie S.A.).
Pursuant to the Management Board’s decisions of 14 March 2023 and 20 November 2023, the Bank issued series
1/2023 two-year senior non-preferred bonds and series 2/2023 three-year senior preferred bonds under the bond
issue programme. The bonds bear a floating interest rate based on WIBOR for 6-month deposits. The nominal value
of one bond is PLN 500k. The above series of bonds were taken up in full and settled on 30 March 2023 and 29
November 2023, respectively, at PLN 1.9bn and PLN 3.1bn. The bonds may be classified as eligible liabilities. For
more information, see Chapter XI “Financial performance”.
Buyback under Incentive
Plan VII
On 23 February 2023, the Bank’s Management Board adopted a resolution on the start of buyback of the Bank’s shares
as part of Incentive Plan VII in order to pay out awards for 2022 based on the KNF’s consent and other authorisations
and resolutions of relevant governing bodies. The following rules for buyback were defined:
The maximum amount allocated to the buyback is PLN 55.3m. The Bank may buy back not more than 207k shares
(representing not more than 0.2% of the Bank’s share capital).
The Bank’s shares will be purchased on the regulated market of the Warsaw Stock Exchange via the agency of
Santander Brokerage Poland.
The price of own shares subject to buyback cannot be lower than PLN 50 and higher than PLN 500 (the EGM of
11 January 2024 changed the upper threshold to PLN 1k).
The Bank may purchase not more than 25% of average daily share volume traded during 20 session days
preceding the buyback day.
The shares will be bought back from the dedicated capital reserve.
As the number of repurchased shares was sufficient to pay out awards for 2022 to the Incentive Plan participants, on
14 March 2023 the Bank announced the end of the share buyback in 2023.
For more information see Chapter XIII
“Statement on corporate governance”, Part 2 “Issuer’s securities”, Section “Ownership structure of share capital”.
Correction of financial
instruments
reclassification
Pursuant to the KNF’s recommendation, on 14 December 2023 the Bank’s Management Board adopted a resolution
to correct the reclassification of selected bonds from the held to collect and for sale model to the held to collect
model made on 1 April 2022. Afte
r the consolidated and separate financial statements for 2023 were corrected, the
above bond portfolio was again classified as financial assets measured at fair value through other comprehensive
income and the comparative amounts for 2022 were restated accordingly.
Pillar 2 (P2G) add-on
imposed by the KNF
On 14 December 2023, the Bank’s Management Board received a recommendation from the KNF to reduce the risk
inherent in the Bank’s operations by maintaining own funds to cover an additional capital requirement of 0.37 p.p. on
both standalone and consolidate
d level over the value of each own funds requirement increased by an additional
requirement arising from the Banking Law Act and a combined buffer requirement imposed under the Macroprudential
Supervision Act.
The above capital add-ons were set at the level enabling the Bank to absorb potential losses resulting from
materialisation of stress conditions. They consist entirely of Common Equity Tier 1 capital.
Additional capital
requirement for
Santander Bank Polska
Group
On 21 December 2023, the Bank received the KNF’s recommendation to maintain own funds at the level sufficient to
cover an additional capital requirement for risk connected with foreign currency home loans and equity releases at
0.013 p.p. above the total capital ratio at a consolidated level.
The total capital ratio must consist in at least 75% of Tier 1 capital (which corresponds to a capital requirement of
0.010 p.p. above the Tier 1 capital ratio) and in at least 56.25% of Common Equity Tier 1 capital (which corresponds to
a capital requirement of 0.007 p.p. above the Common Equity Tier 1 capital ratio).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
11
II. Basic information about the Bank and
Santander Bank Polska Group
1. History, ownership structure and profile
> History of Santander Bank Polska S.A. (key ownership events)
2001
>
Incorporation of Bank Zachodni WBK S.A. (BZ WBK S.A.)
as a result of a merger of Bank Zachodni S.A. with Wielkopolski
Bank Kredytowy S.A. (13 June 2001)
2011
>
Sale of all shares of Bank Zachodni WBK S.A. held by AIB European
Investments Ltd. (70.36% of share capital and voting power) to Banco
Santander S.A. (1 April 2011)
>
Acquisition of 95.67% of share capital and voting power of BZ
WBK S.A. by Banco Santander S.A. in the tender offer for 100% of
the Bank's shares
2013
>
Merger of BZ WBK S.A. and Kredyt
Bank S.A. by way of acquisition (transfer
of all assets of the acquired bank to the acquirer in exchange for newly
issued series J shares allotted to shareholders of Kredyt Bank S.A.) (4
January 2013)
2014
>
Acquisition of ordinary and preference shares of Santander Consumer Bank S.A.
(SCB S.A.) with its registered office in Wrocław by BZ WBK S.A.,
representing 60% of the share capital of SCB S.A. and 67% of votes
at the General Meeting of SCB S.A. (1 July 2014)
2018
>
Registration of the change of the Bank’s name from Bank Zachodni
WBK S.A. to Santander Bank Polska S.A. and its registered office
address from Wrocław to Warsaw in the National Court Register (7
September 2018)
>
Acquisition of a demerged part of Deutsche Bank Polska S.A. and
100% of DB Securities S.A. along with registration of an increase in
the share capital of Santander Bank Polska S.A. by demerger shares
(9 November 2018)
Ownership structure of share capital
Share capital
> Entities with significant holdings of Santander Bank Polska S.A. shares as at 31 December 2023 and 31 December 2022
Shareholders with a stake of 5% and higher
Number of shares and voting rights
% in the share capital
and total votes at GM
31.12.2023
31.12.2022
31.12.2023
31.12.2022
Banco Santander S.A. 68 880 774 68 880 774 67,41% 67,41%
Nationale-Nederlanden OFE
1)
5 123 581
5 123 581
5,01%
5,01%
Pozostali akcjonariusze 28 184 959 28 184 959 27,58% 27,58%
Total 102 189 314 102 189 314 100,00% 100,00%
1) Nationale-Nederlanden Otwarty Fundusz Emerytalny (OFE) is managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne (PTE) S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
12
Banco Santander S.A.
67,41%
Non-controlling shareholders
32,59%
Ownership structure of Santander Bank Polska share capital
as at 31.12.2023
As at 31 December 2023, Banco Santander S.A. held a controlling stake of 67.41% in the registered capital of Santander Bank Polska S.A. and in the total
number of votes at the Bank’s General Meeting. The remaining shares were held by the minority shareholders, of which, according to the information
held by the Bank’s Management Board, only Nationale-Nederlanden Otwarty Fundusz Emerytalny (OFE) exceeded the 5% threshold in terms of share
capital and voting power.
According to the information held by the Management Board, the ownership structure did not change in the period from the end of 2023 until the
authorisation of the “Management Board Report on Santander Bank Polska Group Performance for 2023” for issue.
On 12 January 2023, the Extraordinary General Meeting of Santander Bank Polska S.A. authorised Management Board members to acquire own shares
to perform the Bank’s obligations under Incentive Plan VII. In 2023, the Bank bought back the total of 165,406 own shares representing 0.162% share in
the registered capital and in the total number of votes at the Bank’s General Meeting. As the number of repurchased shares was sufficient to pay out
awards for 2022 to the Incentive Plan participants, on 14 March 2023 the Bank announced the end of the share buyback in 2023. Instructions were made
to transfer the above shares to brokerage accounts of the eligible participants. Having settled all the instructions, the Bank does not hold any own shares.
For more information about the share buyback as part of Incentive Plan VII, see Chapter I “Overview of activities of Santander Bank Polska S.A. and its
Group in 2023” (Part 5 “Corporate events”). More detailed information about the share capital is presented in Chapter VII “Investor relations” (Part 2
“Share capital, ownership structure and share price”) and Chapter XIII “Statement on corporate governance in 2023” (Part 5 “Issuer’s securities”).
Majority shareholder
Santander Bank Polska S.A. is a member of Santander Group, with Banco Santander S.A. as a parent entity.
Banco Santander S.A., having its registered office in Santander and operating headquarters in Madrid, is one of the largest commercial banks in the world
with more than 165 years of history. The bank specialises in retail banking services, but it is also very active in the private banking, business and corporate
banking, asset management and insurance markets.
The business of Banco Santander S.A. is geographically diversified, but it focuses on 10 core markets – both developed and emerging, including Spain,
Poland, Portugal, Germany, the UK, Brazil, Argentina, Mexico, Chile and the USA. With geographic location as the primary criterion, the Group has
identified four main operating segments: Europe, North America, South America, and the Santander Open Platform.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
13
> Santander Group in numbers (as at 31 December 2023)
Profile of the organisation
Legal form
Santander Bank Polska S.A. with its registered office in Warsaw started operations in 1989 as one of the first universal commercial banks in post-war
Poland. Since 1993, it has been listed on the Warsaw Stock Exchange. After several ownership changes and more than 30-year presence on the Polish
banking market, it was the second largest bank in terms of market capitalisation and third in terms of total assets as at 30 September 2023.
The Bank is a parent entity of Santander Bank Polska Group and forms a domestic bank holding group as defined in the Polish Banking Law Act together
with its related entities, including Santander Consumer Bank S.A. (a domestic subsidiary bank). It is also registered as a foreign bank holding group with
Spain-based Banco Santander S.A. as the ultimate parent entity. No financial support agreements referred to in Article 141t of the Polish Banking Law
Act have been concluded as part of the above-mentioned holding groups.
Santander Bank Polska S.A. operates in Poland and has standard business and operational relationships with foreign banks and financial institutions. It
also provides services to foreign customers and cooperates with Santander Group companies on a large scale. The Bank does not conduct active cross-
border operations in other countries.
Business profile of Santander Bank Polska Group
Santander Bank Polska S.A. is a universal bank which provides a full range of services for personal customers, SMEs, large companies, corporates and
public sector institutions. The Bank’s offer is modern, comprehensive and satisfies diverse customer needs with regard to bank accounts and credit,
savings, investment, settlement, insurance and card products. The financial services of Santander Bank Polska S.A. also include cash management,
payments, trade finance and transactions in the capital, money, FX and derivative markets, as well as underwriting and brokerage services.
The Bank continuously develops its product range to ensure that solutions offered to customers are transparent, simple, digital, flexible and available in
self-service channels. It offers unique solutions which are developed within Santander Group based on its global presence, infrastructure and market
potential. Customers are provided with comprehensive services in traditional sales channels and in technologically advanced remote channels. The Bank’s
outlets are located Poland-wide.
The Bank’s own product range is complemented by specialist products offered by its group of related companies, including: Santander Towarzystwo
Funduszy Inwestycyjnych S.A., Santander Leasing S.A., Santander Factoring Sp. z o.o., Santander Allianz Towarzystwo Ubezpieczeń S.A. and Santander
Allianz Towarzystwo Ubezpieczeń na Życie S.A. In cooperation with all these companies, the Bank provides its customers with access to investment funds,
asset portfolios, insurance, leasing and factoring products.
8.5k
branches
164.5m
customers
212.8k
employees
EUR 1,797.1bn
total assets
EUR 104.2bn
total equity
EUR 61.2bn
market
capitalisation
EUR 1,306.9bn
total customer
funds
EUR 1,036.3bn
loans and advances
to customers
EUR 11,076 m
net attributable
profit
2nd largest bank in the eurozone and 21st largest bank in the world in terms
of market capitalisation
(source: Financial Report of Santander Group for Q4 2023)
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
14
Santander Consumer Bank S.A. and its subsidiaries form a separate business segment with its own customer base, product range and distribution
channels. It provides credit facilities to households, mainly in the consumer finance and car finance sectors. It also provides financing to businesses,
mainly car dealers and importers. Santander Consumer Bank Group offers consumer loans, car finance through car loans, lease and factoring, credit
facilities for car dealers, retail and business deposits and insurance products.
As at 31 December 2023, Santander Bank Polska Group provided services to 7.5m customers, including 1.6m customers of Santander Consumer Bank
S.A.
Value creation at Santander Bank Polska Group
> Value creation at Santander Bank Polska Group
People
Motivated and engaged employees...
A key focus of the Group’s strategy is to embed a
strong culture based on Simple, Personal and Fair
values.
How we do things is as important as what we do.
The success of the Group’s strategy is measured by
employee engagement levels which are above the
industry average.
Customers
... mean more satisfied and loyal customers...
Higher number of loyal customers means higher
income, loans and deposits.
Loyal customers more often choose digital channels,
use more products and services and initiate more
transactions with the Bank.
Shareholders
... driving profitability and sustainable growth...
Focus on customer loyalty allows the Group:
to achieve satisfactory growth in financial results in
a short and long term;
to strengthen its balance sheet and capital;
to be more resilient and more effectively respond to
risks if they materialise.
Community
... resulting in higher investment in the community
The Group makes investments for the future in
partnership with universities, supporting education and
financing environmental projects.
It generates sound financial performance in a
responsible way, supporting sustainable growth and
social inclusion.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
15
Position of Santander Bank Polska S.A. and its Group in the Polish banking sector
Position in the peer group
Santander Bank Polska S.A. is ranked among the top three banks in the Polish banking sector (together with PKO BP S.A. and Pekao S.A.) and is the largest
private bank in Poland.
According to the interim reports for the quarter ended 30 September 2023, which at the date of authorisation of this Management Board report for issue
were the most up-to-date source of comparable data on the performance of banks listed on the Warsaw Stock Exchange (WSE), Santander Bank Polska
S.A. – including its subsidiaries and associates – was Poland’s second largest banking group in terms of total equity and market capitalisation, and third
largest one in terms of total assets, deposits and net loans.
472 949
309 935
278 049
232 840
225 389
156 871
123 866
PKO BP PE KAO Santander
Bank Polska
ING BSK mBank BNP Paribas Millennium
Total assets (PLN m) of Santander Bank Polska Group
as at 30.09.2023 against the peer group
45 407
35 300
28 330
15 182
13 690
13 131
6 646
PKO BP Santander
Bank Polska
PEKAO ING BSK mBank BNP Paribas Millennium
Total equity of Santander Bank Polska Group
(PLN m) as at 30.09.2023 against the peer group
376 498
241 308
210 038
202 417
185 109
124 223
106 176
PKO BP PEKAO Santander
Bank Polska
ING BSK mBank BNP Paribas
Millennium
Customer deposits of Santander Bank Polska Group
(PLN m) as at 30.09.2023 against the peer group
239 743
162 422
158 140
158 086
117 805
88 519
73 983
PKO BP PEKAO Santander
Bank Polska
ING BSK mBank BNP Paribas Millennium
Customer loans and advances of Santander Bank Polska Group
(PLN m) as at 30.09.2023 against the peer group
Share in key market segments
According to the NBP statistics on the banking market, as at the end of September 2023 the market share of Santander Bank Polska Group was 12.1%
for loans (11.6% as at 31 December 2022) and 11.0% for deposits (11.1% as at 31 December 2022).
The Group operates in the factoring and leasing markets via its subsidiaries, holding a market share of 10.1% and 10.3%, respectively, as at 30 September
2023 (according to the Polish Factors Association and the Polish Leasing Association). In the same period, the Group’s share in the retail investment fund
market was 10.6% (according to Analizy Online).
∗ Total share of Santander Leasing S.A. and Santander Consumer Multirent Sp. z o.o.
10.6%
share in the
investment fund
market
10.3%*
share in the leasing
market
10.1%
share in the
factoring market
11.0%
share in the deposit
market
12.1%
share in the credit
market
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
16
2. Structure of Santander Bank Polska Group
> Subsidiaries and associates of Santander Bank Polska S.A. as at 31 December 2023
1) SCM Poland Auto 2019-1 Designated Activity Company with its registered office in Dublin was incorporated on 18 November 2019. Its shareholder is a legal person that is not connected with the Group. It is an SPV
established to securitise a part of the lease portfolio of Santander Consumer Multirent Sp. z o.o., which is its controlling entity in accordance with the conditions laid down in IFRS 10.7.
2) In relation to the formation of the automotive manufacturing corporation Stellantis N.V. in 2021 as a result of merger between the Italian–American conglomerate Fiat Chrysler Automobiles and the French Groupe
PSA, on 3 April 2023 PSA Finance Polska Sp. z o.o. and PSA Consumer Finance Polska Sp. z o.o. were renamed Stellantis Financial Services Polska Sp. z o.o. and Stellantis Consumer Financial Services Polska Sp. z o.o.,
respectively. Stellantis Financial Services Polska Sp. z o.o. is an investment in a subsidiary for the purpose of consolidated financial statements due to the fact that it is controlled by Santander Consumer Bank S.A.
(directly) and Santander Bank Polska S.A. (indirectly).
3) SC Poland Consumer 23-1 Designated Activity Company (DAC) is a special purpose vehicle incorporated in Dublin on 17 June 2022 for the purpose of securitising a part of the retail loan portfolio of Santander
Consumer Bank S.A. (SCB S.A.) The SPV does not have any capital connections with SCB S.A., which is its controlling entity in accordance with the conditions laid down in IFRS 10.7.
4) Both owners of Santander Towarzystwo Funduszy Inwestycyjnych S.A. (Santander TFI S.A.), i.e. Santander Bank Polska S.A. and Banco Santander S.A., are members of global Santander Group and hold an equal stake
of 50% in the company’s share capital. In practice, Santander Bank Polska S.A. controls Santander TFI S.A. within the meaning of IFRSs because, as the main business partner and distributor of investment products,
it has a real impact on the operations and financial performance of Santander TFI S.A.
Santander Bank Polska S.A.
Santander Factoring Sp. z o.o.
100%
Santander Leasing S.A.
100%
Santander F24 S.A.
100%
Santander Finanse Sp. z o.o.
100%
Santander Inwestycje Sp. z o.o.
100%
Santander Consumer Multirent Sp. z o.o.
100%
Stellantis Financial Services Polska Sp. z o.o.
2)
50%
Santander Consumer Bank S.A.
60%
SC Poland Consumer 23–1 DAC
3)
0%
Santander Towarzystwo Funduszy
Inwestycyjnych S.A.
4)
50%
POLFUND
– Fundusz Poręczeń Kredytowych S.A.
50%
Santander Allianz
Towarzystwo Ubezpieczeń na Życie S.A.
49%
Santander Allianz
Towarzystwo Ubezpieczeń S.A.
49%
SCM Poland Auto 2019–1 DAC
1)
0%
Santander Consumer Financial
Solutions Sp. z o.o.
100%
Stellantis Consumer Financial Services Polska
Sp. z o.o.
2)
100%
Legend:
%
Share of Santander Bank Polska S.A. in the
company’s capital
Subsidiaries
(consolidated with Santander Bank Polska S.A.)
Associates
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
17
> Subsidiaries and associates of Santander Bank Polska S.A. as at 31 December 2023
Subsidiaries
As at 31 December 2023, Santander Bank Polska Group comprised Santander Bank Polska S.A. and the following subsidiaries:
1. Santander Consumer Bank S.A. (SCB S.A.)
2. Santander Consumer Multirent Sp. z o.o. (SCM Sp. z o.o. – subsidiary of SCB S.A.)
3. Santander Consumer Financial Solutions Sp. z o.o. (subsidiary of SCM Sp. z o.o.)
4. SCM Poland Auto 2019-1 DAC (subsidiary of SCM Sp. z o.o.)
5. SC Poland Consumer 23-1 DAC (subsidiary of SCB S.A.)
6. Stellantis Financial Services Polska Sp. z o.o (subsidiary of SCB S.A.)
7. Stellantis Consumer Financial Services Sp. z o.o. (subsidiary of Stellantis Financial Services Polska Sp. z o.o.)
8. Santander Towarzystwo Funduszy Inwestycyjnych S.A.
9. Santander Finanse Sp. z o.o.
10. Santander Factoring Sp. z o.o. (subsidiary of Santander Finanse Sp. z o.o.)
11. Santander Leasing S.A. (subsidiary of Santander Finanse Sp. z o.o.)
12. Santander F24 S.A. (subsidiary of Santander Finanse Sp. z o.o.)
13. Santander Inwestycje Sp. z o.o.
Compared with 31 December 2022, the list of subsidiaries of Santander Bank Polska S.A. excludes Santander Consumer Finanse Sp. z o.o. w likwidacji, a
subsidiary of SCB S.A. The company was dissolved and put into liquidation as of 31 December 2020 under a resolution of the company’s Extraordinary
General Meeting of 23 December 2020. The liquidation was completed on 15 November 2023. On 22 November 2023, the company was struck off the
National Court Register.
In relation to the formation of the automotive manufacturing corporation Stellantis N.V. in 2021 as a result of merger between the Italian–American
conglomerate Fiat Chrysler Automobiles and the French Groupe PSA, on 3 April 2023 PSA Finance Polska Sp. z o.o. and PSA Consumer Finance Polska Sp.
z o.o. were renamed Stellantis Financial Services Polska Sp. z o.o. and Stellantis Consumer Financial Services Polska Sp. z o.o., respectively.
All subsidiaries of Santander Bank Polska Group as at 31 December 2023 are consolidated with the Bank in accordance with IFRS 10.
Associates
In the consolidated financial statements of Santander Bank Polska Group for the 12-month period ended 31 December 2023, the following companies
are accounted for using the equity method in accordance with IAS 28:
1. Santander Allianz Towarzystwo Ubezpieczeń S.A.
2. Santander Allianz Towarzystwo Ubezpieczeń na Życie S.A.
3. POLFUND – Fundusz Poręczeń Kredytowych S.A.
Compared with 31 December 2022, the list of associates did not change.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
18
III. Macroeconomic situation in 2023
Economic growth
The Polish economy marked a cyclical low at the beginning of 2023, but did not immediately move into a clear recovery phase. In the second quarter,
Poland's GDP growth remained slightly negative (-0.6% YoY). It was only in the third quarter that economic growth moved above zero (+0.5% YoY) and
in the fourth quarter it probably climbed close to 1% YoY, so that on average it was around 0.2% for the whole year. The recovery in the second half of
the year was mainly driven by components of domestic demand – especially private consumption, as investment showed high resilience throughout the
year. At the same time, the year was marked by a sharp reduction of accumulated inventories. This had a strongly negative impact on growth, but it was
offset by a marked fall in imports. In exports, it was difficult to see any significant recovery amid the persistently weak economic situation in Europe. This
also affected domestic industrial production, which fell by an average of around 2% in 2023 and its rebound in the second half of the year was relatively
small. Among the monthly economic activity statistics, the improvement was more pronounced in construction output and retail sales. It was also
reflected in business and consumer sentiment indicators.
Labour market
Despite economic stagnation for some part of the year, the labour market remained strong. The unemployment rate remained at record lows (2.8% in
November according to the Labour Force Survey). Job cuts took place in industry, but were more than offset by employment growth in other areas such
as services and the public sector. In the corporate sector, wage growth remained at double-digit levels, averaging around 12.0% YoY, which, with inflation
retreating rapidly, meant that real wages began to grow again YoY in the second half of the year. During the year, the influx of emigrants into the Polish
labour market decreased.
Inflation
In 2023, CPI inflation set its peak at 18.4% YoY in February before starting a steady, faster-than-expected descent and ending the year at 6.2% YoY. This
brought the average annual inflation rate to 11.6%. Initially, the fall in inflation was mainly due to statistical effects, but it was soon supported by the
normalisation of global energy commodity prices and the strong fall in PPI inflation, which slowed from 20.1% YoY in January to 0.3% YoY in June and -
6.4% YoY in December. Core inflation also fell, although to a lower degree. It remained above 11% YoY until mid-year, but fell to 6.9% YoY by December,
which gives an annual average of around 10.2%.
Monetary policy
In autumn, the Monetary Policy Council cut interest rates, which it had held unchanged since September 2022. The rate cuts were 75 basis points in
September and 25 basis points in October. In consequence, the reference rate was brought down from 6.75% to 5.75%. A marked decline in inflation and
weaker-than-expected economic activity data were cited by the MPC as reasons for the monetary easing. At subsequent decision-making meetings, the
Council decided to hold off on interest rate changes at least until the publication of the NBP's March inflation projection. One of the reasons for the pause
was uncertainty about the new government's fiscal and regulatory policies.
-10
-5
0
5
10
15
20
3Q13
1Q14
3Q14
1Q15
3Q15
1Q16
3Q16
1Q17
3Q17
1Q18
3Q18
1Q19
3Q19
1Q20
3Q20
1Q21
3Q21
1Q22
3Q22
1Q23
3Q23
SELECTED MACROECONOMIC INDICATORS
GDP (%YoY) Current account balance (% GDP)
CPI (%YoY) Employment in corporate sector (%YoY)
Real wages in corporate sector (%YoY)
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
19
Loans and deposits
There has been a visible recovery in the lending market, especially in the segment of mortgage loans, but the overall market activity still remains at a
reduced level. In the first half of the year, this relatively low credit market activity was primarily the result of high interest rates, increased caution on the
part of households, and reduced financing needs of businesses due to lower commodity prices. The launch of the government's 'Secure 2% Mortgage
Loan' programme in July contributed to a doubling of mortgage applications, but the value of the portfolio of PLN mortgage loans rose above its levels
from the previous year only at the end of the year, with the growth rate at 2.2% YoY. There was a faster improvement in the volume of consumer loans,
whose annual growth rate returned to positive figures as early as July and reached 2.3% in December. Demand for corporate loans weakened gradually
and the value of the corporate loan portfolio in December, net of currency effects, was 1.5% higher than a year earlier. At the end of the year, the overall
loan portfolio of the banking sector increased by 2.4% YoY (after adjusting for currency effects) in 2023, following a 0.6% YoY increase in 2022.
At the end of December 2023, deposits grew by 9.8% YoY, with private individuals’ deposits rising by 11.2% YoY and firms’ deposits by 8.8% YoY. The
growth rate of the volume of term deposits slowed to 15.7% YoY, whereas the growth rate of the current deposits volume began to accelerate again,
reaching 7.4% YoY at the end of the year.
Financial market situation
The year 2023 was marked by a gradual tightening of monetary policy by major central banks and by a gradual decline of inflation. Policy rates peaked
in the euro area and the US at the end of the year, reaching 4.5% and 5.5%, respectively, and markets redirected their attention to the timing of the
potential start of interest rate cuts in 2024. The cycle of monetary policy easing has begun earlier in the emerging markets. Central banks in South America
(Brazil, Chile) and Central Europe were the first to cut interest rates. The first central bank in the CEE region to cut interest rates was the National Bank
of Hungary. In September and October, the Polish Monetary Policy Council also decided to lower the interest rates.
After the temporary increase in volatility in the first quarter in response to the turmoil in the international banking sector, the rest of the year in the
international financial markets was characterised by a downward trend in volatility in both equity and bond markets, and in the foreign exchange market.
Low volatility and high interest rates favoured the currencies of emerging economies, including the zloty. In the first half of the year, the CEE region's
currencies were also supported by improving terms of trade and current account balances caused by falling commodity prices. The Polish
currency weakened temporarily in response to the unexpectedly large rate cut by the NBP in September and the following dovish press conference of
the NBP governor. The last months of the year were again marked by a strengthening of the zloty in reaction to the outcome of the parliamentary
elections. The change of government increased investors' perceived likelihood of unlocking the EU funds from the new cohesion policy and the Recovery
and Resilience Facility. The reaction function of the MPC also changed after the elections, as the Council began to signal a more hawkish approach, partly
in response to the prospect of looser fiscal policy. Over the course of the year, the EUR/PLN exchange rate fell to around 4.35 from around 4.69 at the
end of 2022, and the USD/PLN exchange rate fell to 3.94 from 4.40. The rise in the EURUSD exchange rate during the year to around 1.10 from 1.07
supported the zloty.
In the core markets, bond yields remained in an upward trend for most of the year. A decline occurred only towards the end of the year with the end of
the rate hike cycle by major central banks. As a result, yields of German bonds fell by around 30-60 bps and yields of US bonds fell by a dozen or so bps
for 2-5 year tenors, with 10-year yields remaining almost unchanged. The Polish interest rate market was dominated by a downward trend in response
to falling inflation, the surprising scale and pace of NBP rate cuts, and the prospect of an imminent global monetary easing cycle. During the year, Polish
bond yields fell by around 160-180 bps. Yields on 2-year bonds fell to 5.06% at the end of last year from 6.73% at the end of 2022, and 10-year bonds
fell to 5.18% from 6.88%.
2
3
4
5
6
7
8
9
10
Jan 22
Feb 22
Mar 22
Apr 22
May 22
Jun 22
Jul 22
Aug 22
Sep 22
Oct 22
Nov 22
Dec 22
Jan 23
Feb 23
Mar 23
Apr 23
May 23
Jun 23
Jul 23
Aug 23
Sep 23
Oct 23
Nov 23
Dec 23
YIELDS OF POLISH TREASURY BONDS (%)
2Y 5Y 10Y
3.60
3.70
3.80
3.90
4.00
4.10
4.20
4.30
4.40
4.50
4.60
4.70
4.80
4.90
5.00
5.10
4.30
4.40
4.50
4.60
4.70
4.80
4.90
5.00
Jan 22
Feb 22
Mar 22
Apr 22
May 22
Jun 22
Jul 22
Aug 22
Sep 22
Oct 22
Nov 22
Dec 22
Jan 23
Feb 23
Mar 23
Apr 23
May 23
Jun 23
Jul 23
Aug 23
Sep 23
Oct 23
Nov 23
Dec 23
EXCHANGE RATE OF THE ZLOTY VS THE EURO AND THE
DOLLAR
EURPLN USDPLN (rhs)
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
20
Stock market
In 2023, the Warsaw bourse saw the return and stabilisation of very good stock market conditions following the difficult 2022. Most of the stock indices
hit their historical highs, benefiting from the globally favourable investment climate that prevailed for most of the year. After the somewhat sluggish
first six months, the inflow of foreign investment accelerated, supporting both the local currency and the Warsaw Stock Exchange. As a result, stock
indices recorded impressive returns for 2023. The Warsaw Stock Exchange General Index (WIG) gained 36.5% during that time, recording new historical
highs at the year-end. SME indices sWIG80 and mWIG40, followed suit, growing by 30.9% and 39.3%, respectively. On the other hand, WIG20 grew by
30.7%, adjusted on an ongoing basis by the value of dividends paid by blue chips. In addition to the positive sentiment prevailing on foreign stock markets
that emerged from the 2023 United States banking crisis, the second half of the year saw the discounting of changes in the policies of central banks,
which announced the end of the interest rate hike cycle in response to the falling inflation. In turn, the Polish stock market reacted positively to changes
on the Polish political scene. The hopes around the expected improvement in corporate governance helped the valuation of State Treasury companies,
which account for more than 50% of the WIG20 capitalisation. This helped restore demand that had remained subdued since the summer holidays.
Legal environment of the banking sector
The table below shows the selected legislation which was passed or amended or came into effect in 2023 and has impact on the financial sector in Poland.
Regulation Scope
Act on family housing loan and the
2% safe mortgage
A state-subsidised mortgage offered to first time home buyers under 45 years of age.
The maximum loan amount is 500k for singles and 600k for married or cohabiting couples.
The maximum deposit from the borrower is PLN 200k.
The subsidy is provided for 10 years of the lending period (120 instalments).
Act on the mObywatel application
Introduction of the mObywatel mobile document confirming the identity and Polish citizenship of a user of
the mObywatel application for activities taking place in Poland that involve physical presence of the parties.
Starting from 1 September 2023, banks are required to use the mObywatel document as a customer due
diligence measure for identification of customers and verification of their identities.
Consumer Lombard Loan Act
Extension of the scope of the Consumer Loan Act to include loan agreements made with natural persons
carrying out an agricultural activity as defined in Article 6(4) of the Act on social insurance for farmers
(effective as of 7 January 2024).
The changes concern, among other things, the contents of loan agreements, information obligation
towards customers and the maximum non-interest costs of a consumer loan.
Recommendation U
Changes to the distribution of insurance effective as of 1 July 2024:
the cost of indemnity and other consideration payable to the insured (excluding cost of loss
adjustment, including cost of court proceedings) included in payment protection insurance should be
at least 30% of gross insurance premium;
obligation to exercise due care to ensure that group insurance plans cover customers’ needs arising
from their potential liabilities towards the bank;
change in the scope of information obligations towards customers.
Act amending certain acts to limit
certain consequences of identity
theft
Starting from 1 June 2024, banks will be required to check if the consumer’s PESEL number has not been
blocked before:
making a savings account agreement, personal account agreement or payment instrument issuance
agreement if such an agreement provides for the possibility to make a loan agreement;
making a loan agreement or making changes to such an agreement resulting in an increase in the debt
level;
making a consumer loan agreement or making changes to such an agreement resulting in an increase
in the debt level;
making a payment account agreement or an overdraft agreement or making changes to such an
agreement resulting in an increase in the debt level;
executing a cash withdrawal instruction which alone or in combination with previous withdrawals
causes the sum of withdrawals made on a given day in all branches of a given institution to exceed
three times the minimum wage.
Banks cannot make claims against consumers or their legal successors under an agreement or transfer
receivables under an agreement if the consumer’s PESEL number was blocked at the time it was executed
and the bank had an obligation to verify it.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
21
Regulation Scope
Act of 1 December 2022 amending
the Labour Code and certain other
acts
The Act introduced the following provisions to the Labour Code:
rules for alcohol testing of employees;
rules for remote work, in particular: the form of an agreement between employer and employee
regarding remote work, need to define rules for remote work in an agreement with trade unions, rules
for reimbursing costs directly related to remote work. The Act supersedes previous remote work
regulations introduced by the emergency legislation.
Impact on banks: implementation of specific solutions in HR processes, conclusion of an agreement on
remote work with trade unions.
Act of 9 March 2023 amending the
Labour Code and certain other acts
The Act transposes the following EU regulations into the Polish law:
Directive (EU) 2019/1158 of the European Parliament and of the Council of 20 June 2019 on work-life
balance for parents and carers and repealing Council Directive 2010/18/EU
Directive (EU) 2019/1152 of the European Parliament and of the Council of 20 June 2019 on
transparent and predictable working conditions in the European Union.
The Act introduced changes to the rules for terminating fixed-term contracts, granting parental leaves and
paying maternity allowance, extended employers’ information obligations towards employees, and
introduced two new types of justified absence (carers’ leave and absence on the grounds of force majeure).
Impact on banks: implementation of specific solutions in HR processes.
National Money Laundering and
Terrorist Financing Risk Assessment
On 6 December 2023, the Ministry of Finance published the National Money Laundering and Terrorist
Financing Risk Assessment that banks must consider in their own assessment of money laundering and
terrorist financing risk related to their activities (in ac
cordance with Article 27(2) of the Act on prevention
of money laundering and terrorist financing).
Act amending certain acts to
strengthen oversight over the
financial market and protection of
investors
Introduction of a single banking licence: banks do not need to obtain an additional licence for brokerage
activity.
Introduction of regulations on banking outsourcing and sub-outsourcing.
Changes regarding banking secrecy and professional secrecy.
Powers granted to the KNF to impose fines on former management and supervisory board members who
violated law during their time in office.
Requirement to apply for consent to amend the articles of association by removing an object from the
objects clause if the bank has not undertaken the activity during 12 months or has ceased to perform that
activity for 12 consecutive months.
Restriction on the sale of corporate bonds to retail customers over the counter or outside the alternative
trading system or crowdfunding platforms.
Act of 1 December 2022 on the
Financial Information System
New reporting obligations imposed on banks, among other entities, as a result of development of the
Financial Information System (SInF) to collect, process and disclose information about opened and closed
accounts and safe deposit box agreements.
SInF is used in particular to prevent money laundering and terrorist financing and to prevent, detect or
support a criminal investigation concerning crimes listed in specific regulations , including the
identification, tracing and freezing of the assets related to such crimes.
The information stored in SInF will be used by courts, prosecutors and other law enforcement agencies to
carry out their statutory duties.
Act of 14 April 2023 amending the
Act on Value Added Tax and certain
other acts (“CESOP”)
Starting from 1 January 2024, EU payment service providers (including banks) will be required to report
cross-border payments to the Central Electronic System of Payment information (CESOP).
The CESOP regulations are part of the EU initiative to close the VAT gap, particularly in e-commerce.
Payment service providers will have to keep electronic registers of cross-border payments and provide
access to such registers to the Head of the National Revenue Administration.
The reporting obligation will cover all cross-
border transfers of funds from the EU, including credit
transfers, direct debits, card payments, money remittance and electronic money transfers, whether made
by consumers or businesses.
Domestic payments and payments made outside the EU will not be reportable.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
22
IV. Development strategy
1. Purpose, aim, values and strategic objectives
At the end of 2023, the Bank’s Management Board adopted the strategy of Santander Bank Polska Group for 2024–2026, which is a continuation of the
previous course of action and is based on the same values and assumptions as applied before.
The purpose, aim and values of Santander Bank Polska Group have not changed for years:
Strategy for 2024–2026
> Strategy of Santander Bank Polska Group for 2024–2026
The strategy of Santander Bank Polska Group has been developed to meet the priorities of the Bank as a modern organisation. Its key pillar is Total
Experience, which is focused on maximising customer and employee experience. Total Digitalisation means further development of digital service
channels for customers and an effective digitalised work environment for employees. Total Responsibility reflects the Bank’s responsible business agenda
and covers both environmental and social aspects.
Purpose
Aim
Values
To help people and businesses prosper
To be the best open financial services platform by
acting responsibly and earning the lasting loyalty
of employees, customers, shareholders and
communities
Simple|Personal|Fair
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
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Strategic directions
When setting strategic directions, the Group also defines strategic objectives and key success measures that let it track the progress in delivery of the
strategy.
Total Experience
What do we want to achieve?
A unique corporate culture where customer experience and employee experience are equally important.
A unique process of designing solutions together with users, focusing on people needs, which lays at the heart of our competitive advantage.
We also ensure pragmatic value and positive emotional connection with customers and employees.
Our ambitions
We combine CX and EX to increase the synergy of our actions:
• We have created an integrated TX approach. This is how we design and deliver unique experience to our customers and employees. This
will make us joyfully brave, happily human and seriously impactful.
We care about fundamentals:
• We are surprisingly simple, as we streamline processes, solutions, documents and communication for customers and employees.
• We care about work-life balance, competitive remuneration and physical and mental wellbeing of our employees.
We develop tools:
• We always take into account employee perspective when designing solutions for customers. The experience of one customer does not
negatively affect the experience of another customer.
• We strengthen process ownership based on comprehensive customer and employee experience: Total Experience Ownership
We are transforming our culture:
• We strengthen the corporate culture of Santander based on cooperation, trust, diversity, empowerment and continuous development.
• We build the culture of cooperation in the spirit of One Team, placing emphasis on experimentation and continuous improvement.
• We support leadership as the key element in building a human-centred organisation.
Becoming a Love Brand:
• We support customers and employees by communicating with them using emotional differentiators.
• We design and test products and services with customers and employees based on TX Guide.
Total Digitalisation
What do we want to achieve?
Digital business model developed on the basis of the following objectives:
• We deliver the best digital experience to our customers and employees, making it unique. This will make us joyfully brave, happily human
and seriously impactful.
• We strengthen process ownership – business owners have greater decision-making power to manage all customer and employee paths
(sales, post sales, internal processes). To achieve that, they use KPIs, monitoring and budget.
• We ensure digital, end-to-end self-service of all processes, unless it is not cost-effective or customers prefer in-branch or remote service
(Optichannel).
• We maximize customer and employee self-service. We migrate customers to digital self-service while assisting them in traditional
channels.
• We leverage personalised communication, digital proposition and 360º customer view (hyperpersonalisation) to make us joyfully brave,
happily human and seriously impactful in Optichannel.
• We have open APIs – we design all interfaces from scratch to speed up delivery to external partners.
• We use artificial intelligence and machine learning to support cost and operational efficiency.
Time to value:
• We accelerate Time to Value and Time to Market without compromising on quality.
• We ensure a flexible approach to experiments according to the needs of their owners.
• We implement and use modern layers of integration and data access (New Backends).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
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Relationships with employees and customers:
• We have all the necessary information about customer preferences and behaviours to provide them with a smooth and personalised
service path.
• We wish to maintain interpersonal relationships with customers, especially through branches, managers and product experts (BCB & CIB).
At the same time, we help them settle into the digital world.
• Our customers are not afraid to give us their data.
• We provide excellent quality paths that make customers and employees want us to be their partner in non-banking services. That said,
our services include more than just banking.
Our ambitions
Digital business model:
• We have specific owners and tools to manage processes – sales, post-sales and internal processes.
• We have KPIs and targets in place for all customer and employee journeys.
• We automate repetitive, low added-value processes by using a robotics platform.
• We centralise post-sales services from physical channels to automate them.
• Capabilities in digital and process management, including robotisation, are key to successful transformation. We focus on their
development and connection with employee objectives.
• We strive for quick elimination of legacy solutions from our processes and systems.
• We have open APIs – we design our solutions to make interfaces available to third-party developers.
• We maximize the use of digital channels by customers, offering assistance from our advisors if needed.
• We focus on simple documents and processes and plain language in communication with customers and employees.
• We favour cross-segment cooperation to use the same solutions whenever this is viable. We ensure smooth migration between segments.
Time to Value:
• We start measuring Time to Value, not just Time to Market, and accelerate this process based on data.
• We are business-minded: we make decisions about investments and priorities based on data (business cases).
• We promote experiments to test response from customers and employees. For this reason, we ensure:
light experiment management – clear hypotheses and measurements, defined duration and conclusion-drawing – all fit for
purpose;
a central budget for experiments.
• We promote quick migration of digital processes to new backends.
Relationships with customers and employees:
• Process owners capture and use data relating to all customer and employee interactions across all journeys.
• We implement new CRM, modeling and experimentation tools as a lever for hyperpersonalisation and optichannel.
• We create an ecosystem of services through value-added services (VAS).
Total Responsibility
What do we want to achieve?
Our objectives are based on the ESG areas.
E (Environmental):
• We are a role model in terms of sustainability and transformation.
• We help and guide customers through green transition.
• We build business networks, finding trusted partners and helping them arrange finance.
S (Social):
• We support society by providing education, preventing financial exclusion and making social investments.
• We provide comprehensive communication on our social activities that build the awareness of our impact.
• We promote equality and diversity among employees.
• We counteract digital exclusion, offering friendly digital products and advising customers.
• We ensure a high level of cybersecurity and transparent communication with customers, talking straight about risks.
G (Governance):
• We live up to our commitments to all stakeholders and are transparent about our plans and activities.
• Our regulatory compliance ensures security and stability, whereby we can strengthen customer trust.
• We talk with regulators and industry organisations about new legislative directions that favour a sustainable transition.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
25
Our ambitions
E (Environmental):
• Transformation of the Bank:
We maintain net zero emissions and keep increasing power usage effectiveness.
Our business model takes into account environmental risks.
We train and support employees in green transactions, identifying ESG risks and greenwashing practices.
We increase the Green Asset Ratio and diversify the portfolio of green assets and products.
We analyse “scope 3” emissions as part of the portfolio and identify decarbonisation levers.
We develop transformation plans that cover objectives with respect to the adaptation and mitigation of climate change in
accordance with Santander Group’s strategy.
We are working on a preferential offer for employees connected with environmentally friendly goals
• Transformation of our customers:
We develop transformation products and advisory services across segments.
We identify and use synergies in supply chains.
We are working on a city transformation programme.
We deliver solutions for agricultural business.
We support the energy transformation of buildings.
S (Social):
• We conduct educational programmes on finance and cybersecurity.
• We reduce financial exclusion and care about vulnerable customers.
• We continue development of social support initiatives.
• We promote diversity, equity and inclusion among employees.
• We increase investments into the communities that focus on social care, entrepreneurship and the environment.
• We care about the security of our customers in our digital channels.
G (Governance):
• We build customer, employee, investor and regulator trust projecting our image as a safe and trustworthy bank.
• We support the proactive process of managing regulatory initiatives.
• We strengthen risk culture by ensuring effective control environment.
• We prevent greenwashing risk.
• We talk about our ESG actions, plans and aspirations.
• We focus on sustained profitability that allows us to finance non-business activities.
• We work with development banks and capital providers, distributing the raised capital at a lower cost (greenium).
• We integrate the process of reporting ESG data and support the adaptation of systems and progresses for collecting ESG data.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
26
Ambitions of Santander Bank Polska Group as part of the strategy for 2024–2026
In view of dynamic and complex changes in the macroeconomic environment, the strategy of Santander Bank Polska Group is regularly verified, which
helps take prompt action in response to market trends and other changes in the dynamic environment.
Strategy for 2021–2023
In 2023, the Group continued to deliver its strategy for 2021–2023 based on the adopted purpose and six strategic directions.
> Key strategic dimensions for 2021–2023
The strategy of Santander Bank Polska Group applicable until the end of 2023 reflected a customer-centric approach to business management through
continuous improvement of service quality and product range. A special focus was placed on digitalisation and simplification of processes from the
perspective of customers, which helped to enhance their experience, increase operational efficiency and provide more simple and transparent products
and services. The delivery of the Group’s strategy was underpinned by innovative solutions and the corporate culture which is focused on increasing
engagement and motivation of employees as well as social responsibility of the organisation.
As part of the strategy for 2021–2023, the following six strategic directions were defined: “Customer obsession”, “Employee focus”, “Simplification”,
“Smart omnichannel”, “Innovate to open platform”, “Safety and trust”. They were the key focus areas of the Group’s transformation.
Return on Equity Top3 for the Polish banking sector
NPS Top3 for the Polish banking sector
Top Employer Certificate
Total Capital Ratio Dividend triggering level
Cost of Risk 70-90bps
Cost to income ratio <35%
Dividend payout ratio Dividend payment in the amount permitted by the regulator
KPI
Ambition level in the time frame of the strategy
Our Purpose
/Mission
Our Aim
/Vision
Values
Behaviours
&
Leadership Commitment
Strategic
Directions
Initiatives
Metrics
Help people and businesses prosper
Be the Best Open Financial Services PLATFORM by acting RESPONSIBLY
and earning the lasting LOYALTY of our people, customers, shareholders and communities
Simple – Personal - Fair
• Think customer • Embrace change • Act now • Move together • Speak up
• Being open and inclusive • Inspiring and executing transformation • Encouraging the team to prosper• Leading by example
Customer
Obsession
Simplification
Employee
Focus
Omnichannel
Evolution to
Open
Platform
Safety
& Trust
• Strategic programs
• Bets
• Group programs• Hotspots
• TCR
• ROTE
• C/I
• C/I
• NPS
• Loyal Customers
• eNPS
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
27
> Six strategic directions for 2021–2023: “Focus to accelerate”
2. Ambitions for 2021–2023 and delivery of the strategy
Strategic directions
When setting strategic directions, the Group also defines strategic objectives and key success measures that let it track the progress in delivery of the
strategy.
Employee focus
Achievements: Key success measure: Ambitions:
Implementation of a hybrid work model
taking into consideration the voice of
employees.
Optimisation of a significant number of HR
processes through their automation and
implementation of an e-signature.
Promotion of diversity, equal treatment
and inclusion.
Support for
talent development and
responsible leadership.
Monitoring of employee satisfaction
based on the results of the eNPS survey.
Ensuring equal pay.
High level of Agile maturity (ceremonies
and tools).
Develop the corporate culture based on
the Simple, Personal and Fair values.
Increase employee engagement and
retain the employer of choice title.
Attract and retain best talents.
Continue to develop key competencies
(including leadership skills).
Foster an inclusive and friendly work
environment.
Innovate to Open Platform
Implementing
Global and One Europe
Santander
solutions, ensuring accesss to third party providers (API)
and integrating internal applications
Increasing
operational excellence
through speedy
and cost effective implementations thanks to innovative
API architecture and partnerships
Safety and Trust
(CSR & Cybersecurity & IT systems stability)
Delivery of the
responsible banking agenda
Reliability of IT systems ensured through
a high level of cyber security and stability
(channels and support)
Smart Omnichannel
Gradual implementation of smart self-service
anytime and anywhere
. Maximising the number of
remote processes available to customers
and
encouraging them to use self-service solutions through
various stimuli & motivators.
Multichannel integration of CEX based on customer value,
customer preferences and cost to serve
Customer Obsession
Managing key customer journeys end-to-end and
developing solutions
using service
design competencies to ensure
breakthrough customer experience
Simplification
(Operating model & organizational structure)
Simplifying the core in 4 major areas
:
products,
processes, papers and performance under One Europe
umbrella - One Purpose One Process approach through
seamless e2e processes.
Flat and simple organizational structure
Employee Focus
Employee experience as a gateway to customer
delight.
Ability to retain and acquire new
talents
is a key to building critical competencies and
skills supporting bank’s transformation
Customer
Obsession
Simplification
Smart
Omnichannel
Employee
Focus
Innovate to Open
Platform
Safety & Trust
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
28
Customer obsession
Achievements: Key success measure: Ambitions:
Acceleration of process digitalisation and
optimisation
More extensive communication and
measures taken in response to key issues
concerning Poles
Support for refugees from Ukraine – an
offer for individuals and businesses
Introduction of plain language in
documents, offers and communication
with customers
Adaptation of communication (channels,
language, message, offer) to the needs of
specific customer groups
Positive result of the audit at the Bank (as
a signatory and one of the initiators of the
Responsible Sales Declaration) confirming
that the Bank’s internal regulations are
transparent and customer friendly
Stable increase in mass NPS.
Build long-
term customer relationships
thanks to products created using service
design competencies and feedback from
customers from individual segments.
Build loyalty and increase digitalisation of
customers.
Increase customer satisfaction (NPS).
Simplification
Achievements: Key success measure: Ambitions:
Simplification of the product range and a
number of key processes used by our
customers and employees.
Further measures taken to become a
paperless bank.
Optimisation of the number of products in
terms of the front book and back book.
Increase in the number of customers using
e-communication channels.
Reduction of the number of products.
Extension of the scope of SMS-based
authentication of payments and cash
transactions at branches and introduction
of electronic signature of documents.
Digitalisation of communication of
changes in interest rates and dispatch of
mortgage repayment schedules.
Centralisation of the mortgage
establishment and release process (no
need for the customer to visit the branch).
Further reduce paper documents and
promote electronic communication.
Continue to simplify processes and
products and digitalise post-
sales and
internal processes.
Implement a wide-
scale process of
signing documents in advisor-based
channels in electronic form.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
29
Smart omnichannel
Achievements: Key success measure: Ambitions:
Design and launch of a pilot of a new
mobile application for retail customers.
Further development of iBiznes24
internet banking for corporate
customers.
Increased availability of products and
processes in digital channels
(autosavings, insurance offer, price
comparison engine for motor insurance,
restructuring portal).
Reduction of the number of processes
requiring a visit to a branch.
Focus on personalisation of
communication and offer in digital
channels.
Active measures taken to migrate
customers to digital channels and
increase the number of customers
acquired in those channels.
Further optimisation of branch network.
Alignment of customer experience across
all channels.
Development of the restructuring portal.
Increase in the number of digital
customers.
Increase in the number of transactions
made in remote channels.
Growth of product sales through self-
service channels.
Increase in the number of transactions
and communications which are paperless
and do not require a traditional hand-
written signature.
NPS for the mobile application.
Maximise the use of self-
service and
remote channels in key sales and post-
sales processes.
Increase the number of digital customers.
Improve customer experience in remote
contact channels.
Innovate to open platform
Achievements: Key success measure: Ambitions:
Support for further evolution to an open
platform in cooperation with Santander
Group and external partners.
Development of open banking solutions
via Santander Open.
Development of GTS platform offering
new digital services for corporate
customers.
Extension of cooperation with external
partners (e.g. mojeID).
Growing number of customers using
Santander Open (PSD2 aggregator).
Further develop and improve the open
financial services platform.
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Safety and trust
Achievements: Key success measure: Ambitions:
Further steps taken to meet the objectives
of the Group’s Net-Zero strategy.
Implementation of the Sustainable
Finance Classification System based on
the EU taxonomy.
Expansion of the range of green products
and services and support for customers in
their green transition.
Creation of a diverse and friendly working
environment.
Launch of the ESG Database project to
address regulatory requirements
(Taxonomy, Pillar 3, CSRD).
Top award for the Bank’s ESG report in the
Sustainability Reports competition.
Support for green transformation of
corporate and investment banking
customers.
Green finance of PLN 5,499m in 2023.
34.96% of women in managerial
positions.
Equal Pay Gap of 1.17%.
88% of energy used by the Bank coming
from renewable sources.
Issuance of cards made of recycled
plastic. By 2025, all cards issued by
Santander Bank Polska S.A. will be made
of that material.
Expansion of the product range to include
a loan with ECO special offer, eco loans,
loans for sustainable investments and
green bonds.
Develop green finance and support
customers in their transition to a low- and
zero-emission operating models.
Adapt our measures to meet the
sustainable regulatory requirements.
Continue to develop leadership skills,
focus on employees and promote
diversity, equal treatment and inclusion in
the workplace.
Build the awareness of fraud risk among
the Bank’s customers and employees as
part of promotion of cybersecurity culture.
Ensure high stability and security of our
systems and take measures to
significantly reduce the number of system
failures.
> Financial and non-financial measures of Santander Bank Polska Group (as at 31 December 2023 and 31 December 2022)
Number of customers
Number of employees
Number of branches*
2023
7.5m
11,471 (FTEs)
336
2022
7.4m
11,309 (FTEs)
351
NPS Mass*
Number of digital
customers*
Number of internet and
mobile banking transactions
*
2023
TOP 3
3,497k
494m
2022
TOP 4
3,285k
438m
C/I
Dividend
payout ratio*
TCR
CoR
2023
29.5%
97.01%
18.56%
0.72%
2022
37.9%
29.90%
19.74%
0.59%
* Only Santander Bank Polska S.A. (the number of branches also includes off-site locations and Santander Zones)
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Elements of the strategy related to sustainable development. Level of integration of
sustainability objectives with other elements of the strategy
Sustainable development is reflected in the third strategic direction of the “We help you achieve more” strategy of Santander Bank Polska Group for
2024–2026, namely Total Responsibility.
As part of this direction, ambitions were set for individual ESG areas:
• E (Environmental): in which the Bank is a role model in terms of sustainability and transformation and supports customers in green transition.
• S (Social): in which the Bank supports society by providing education, preventing financial exclusion and making social investments. It promotes
inclusion and diversity among employees and ensures a high level of cybersecurity.
• G (Governance): through which the Bank lives up to its commitments to all stakeholders. Its regulatory compliance ensures security and
stability, whereby it can strengthen customer trust. The Bank also talks with regulators and industry organisations about new legislative
directions. It develops its risk culture too.
Particularly noteworthy is that all three strategic directions of the new strategy have their own independent objectives but complement each other at the
same time.
Due diligence in management, strategy and business model
Santander Bank Polska S.A. has the Strategic Planning Policy in place in accordance with law and KNF’s recommendations.
The strategy of Santander Bank Polska Group is a basis for individual units to develop their business and financial plan to achieve strategic goals. The
Management Board of Santander Bank Polska S.A. is responsible for the entire strategic planning process. The Financial Management Division is the
owner of the Strategic Planning Policy.
The strategic planning process is composed of the following stages: the quarterly and annual review of the existing strategy, preparation of strategic
analyses and conclusions (including analyses of market environment, business model, financial and business plans as well as resources and skills),
development and approval of a new strategy, implementation of the strategy and monitoring of progress in its execution.
The strategy of Santander Bank Polska Group is supplemented by documents prepared by individual units of the Bank, in particular: Risk Management
Strategy, Non-Performing Exposures Strategy, strategies related to IT areas and ICT security, and Capital Management Strategy/Funding Strategy.
Impact of stakeholders’ interests and opinions on the strategy and business model
The Bank has a specialist unit – the Strategic Transformation Office, which is focused on the strategy and its impact on the business model of Santander
Bank Polska S.A. It supervises the ownership of processes related to the design, monitoring and review of the applicable strategy.
Stakeholders such as Management Board members, managers and employees representing all business and operational areas of the Bank actively
contribute to the development of the strategy. Each of the groups participates in preparations, sets priorities and defines goals. Engagement of strategy
recipients at the development stage ensures better understanding and supports the communication of objectives across the organisation. The final
strategy along with its measures and ambitions is approved by the Bank’s Management and Supervisory Boards.
Significant impacts, risks and opportunities and interaction with the strategy and business
model
Changes made to or planned to be made to the strategy and business model in order to prevent specific significant impacts or risks or use specific
significant opportunities are defined in the new strategy of Santander Bank Polska Group for 2024–2026.
3. Corporate culture
The corporate culture of Santander Bank Polska Group is based on the values and ethical standards which help build trust and earn lasting loyalty of
employees, customers, shareholders and local communities.
The foundations of the corporate culture of Santander Bank Polska Group and Banco Santander Group are the General Code of Conduct and
Simple|Personal |Fair values and behaviours.
The Simple|Personal|Fair values reflect the Group’s philosophy, including rules it follows when taking decisions and interacting with customers,
shareholders and other stakeholders. In line with these values, the Group strives not only to fulfil its business commitments and comply with
laws, regulations and best practice, but also to exceed expectations of its stakeholders, particularly customers. Special focus is placed on the areas
where the Group may significantly help customers achieve financial success and sustainable growth.
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Simple
Personal
Fair
The Group’s products and services are tailored
to customers’ needs and expectations and
based on easy-to-understand and
uncomplicated solutions and procedures. The
Group continuously improves operational
processes and communicates with customers
using plain and clear language.
The Group builds lasting relationships with
customers. Customers are provided with
tailored products and personalised services.
The Group strives to treat each employee and
customer in a way that makes them feel
special and appreciated.
Employees and customers are treated equally
and fairly. Banking business is conducted with
due care in a transparent and compliant
manner. The Group maintains satisfactory
relationships with shareholders, trusting that
what is good for them is good for Santander
Group. It keeps promises and fulfils its
commitments towards communities.
The Group promotes five corporate behaviours among its employees, which are additionally used as a performance review criterion:
Apart from the corporate behaviours which apply to all employees of the Group, leaders (managers) are expected to act in line with the leadership
commitments summarised below.
The risk culture promoted by Santander Bank Polska S.A. is called Risk Pro and consists of five principles: responsibility, resilience, simplicity,
challenge and customer focus. Activities implemented within this culture include: education of the Bank's employees; awareness-raising activities
among employees relating to risks encountered in day-to-day work; providing channels for anonymous reporting of issues of concern; and features
of the incentive system encouraging employees to adhere to the risk culture values.
Diversity and inclusion in the workplace, the quality of product offer and services for customers and outstanding relations with other stakeholders
are seen by the Group as the sources of its strength and competitive advantage.
The Group promotes diversity, among other things, by eliminating gender pay gaps, increasing the female representation on managerial positions,
employing people with disabilities and delivering the Barrier-free Banking Programme (implementing new features in branches for people with
disabilities and adjusting advertising and educational communication to their needs).
Corporate behaviours applicable since 2022 speed up transformation of the organisation and make it more attractive for customers. The new
corporate behaviours form an acronym: “T.E.A.M.S.”, emphasising that people, teams and customers are the top priority for the Group.
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The Group conducts its activity in line with the principles of responsible banking and sustainable development (“Responsible Banking and
Sustainability Policy”), understanding the role and importance of banks to customers, the economy, the environment and the community. It focuses
on developing fair and transparent relationships with customers and making a positive contribution to communities and the environment.
4. Forecast of economic situation in 2024
Economic growth
The coming quarters are likely to see a further economic recovery, with annual GDP growth expected to return to 3%, close to the potential growth rate,
as early as Q1 2024. The recovery will be driven primarily by an increase in consumer demand, and by a further, albeit less stronger, increase in
investment, despite a likely unsupportive international environment, in particular the weakness of the euro area economy. Additional support will be
provided by the actions of the new government, including the unblocking of European Union funds, an increase in public sector wages and the creation
of a better investment climate. Global reshoring processes should also be favourable to the Polish economy. As a result, the annual GDP growth in 2024
should average 3.0%.
Labour market
Further economic recovery should lead to an increase in demand for labour across the economy. However, the scale of the recovery will not require a
significant increase in the number of workers, given the labour reserves made by companies. This allows one to expect that the employment growth will
be only slightly above zero. Labour demand, wage increases in the public sector and an increase in the minimum wage should keep the overall nominal
wage growth close to 10% YoY.
Inflation
Thanks to the extension of the “anti-inflation shields” CPI inflation will fall to around 3% YoY in March and then, due to such factors as the expected
expiry of the shields, it should rise to around 7% YoY in December. The fall in inflation from elevated levels will be hindered by the economic recovery
and high household income growth. Core inflation will likely fall to around 5% YoY in March and remain close to this level for the rest of the year.
Monetary policy
The central bank's reaction function has changed markedly in the last months of 2023, with the Monetary Policy Council starting to attach more
importance to bringing inflation down to the target than to stimulating economic growth. In addition, the NBP's March inflation projection is likely to
present a higher inflation path, as it will only take into account the temporary extension of the anti-inflation shields. As a result, we do not believe that
the Monetary Policy Council will return to monetary easing any time soon. n our view, the reference rate is likely to be kept unchanged until the end of
2024.
Loans and deposits
The growth of the banking sector’s mortgage loan portfolio is likely to continue in 2024, although the depletion of funds from the “2% Safe Mortgage”
support programme should result in normalisation of demand for this type of financing, at least until the “Apartment for a Start” (“Mieszkanie na start”)
government programme is launched. The recovery in consumer demand should support further growth in the consumer loan portfolio. Credit demand
from businesses should also improve. As a result, we expect solid growth in loan volumes in 2024, approaching 10% YoY by the end of the year. Deposit
volume growth should remain close to 10% primarily due to expansionary fiscal policy.
Financial markets
In 2024, the key global factors that will positively influence risk appetite will be an improvement in global investment sentiment due to the upcoming
monetary easing cycle by major central banks and a soft landing of the global economy. We expect a tendency for the zloty to strengthen in the first half
of the year with increased inflows of EU funds and in response to the rather distant timing of interest rate cuts, together with the expected further rise in
the EURUSD exchange rate. In the second half of the year, an increase in volatility in international markets in connection with the US presidential election
is possible, and increased volatility typically means the zloty weakness. The expected deterioration of Poland’s current account balance and a possible
significant change in the very loose monetary policy of the Bank of Japan will also be risk factors for the zloty.
In the debt market, we expect yields to fall slightly in the domestic market, despite the NBP keeping the interest rates unchanged. This should be
supported by a strengthening in the foreign debt markets as the main central banks approach the beginning of their interest rate cut cycles. In our view,
rate cuts by major central banks may start in the second half of the year. High borrowing needs and debt issuance may slow the decline in local asset
swap spreads.
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V. Relations with employees
1. Human capital
Employment
As at 31 December 2023, the number of FTEs in Santander Bank Polska Group was 11,471 (11,309 as at 31 December 2022), including 9,420 FTEs of
Santander Bank Polska S.A. (9,281 as at 31 December 2022) and 1,513 FTEs of Santander Consumer Bank Group (1,519 as at 31 December 2022).
The employment in Santander Bank Polska Group increased by 162 FTEs YoY.
The Group continues the transformation of the business model through digitalisation, branch network optimisation, migration of products and services
to remote distribution channels, and gradual implementation of technological and organisational solutions increasing operational efficiency.
The objective is to allocate the maximum resources to strengthen customer relationships, grow business and build skills matching the target profile for
the organisation.
The HR processes take into account present operational needs, development requirements as well as the market and regulatory environment.
> Employment of Santander Bank Polska Group
13 579
12 616
11 323
11 309
11 471
31-Dec-2019 31-Dec-2020 31-Dec-2021 31-Dec-2022 31-Dec-2023
Employment in Santander Bank Polska Group
as at 31 December in years 2019-2023 (in FTEs)
Santander Bank Polska S.A.
82%
Subsidiaries
18%
Employment structure in
Santander Bank Polska Group as at 31.12.2023
9 267
9 338
9 300
9 281
9 287
9 351
9 379
9 420
468
473
497
509
509
518
530
538
1 574
1 538
1 528
1 519
1 515
1 528
1 515
1 513
11 309
11 349
11 325
11 309
11 311
11 397
11 424
11 471
31-Mar-2022
30-Jun-2022
30-Sep-2022
31-Dec-2022 31-Mar-2023 30-Jun-2023 30-Sep-2023
31-Dec-2023
Employment at Santander Bank Polska Group (in FTE)
by quarter in 2022 and 2023
Santander Consumer Bank S.A. Serie2 Santander Bank Polska S.A.
Human and intellectual capital of Santander Bank Polska Group is created by highly-qualified employees who constantly develop their
competencies as part of day-to-day activities and top-quality development programmes.
Comprehensive development programmes for managers and employees and continuous focus on knowledge sharing and self-education contribute
to the growth of the intellectual potential as well as efficiency and stability of the Group’s human capital.
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> Employment structure of Santander Bank Polska Group
up to 25 yrs
4%
26-35 yrs
29%
36-45 yrs
35%
46-50 yrs
15%
over 50 yrs
17%
Employee structure by age
at Santander Bank Polska Group
Men
33%
Women
67%
Employee structure by gender
at Santander Bank Polska Group
Employees with minimum
university education
74%
Employees with other
than university
education
26%
Employee structure by education
at Santander Bank Polska Group
Women make up the majority of Santander Bank Polska Group’s workforce (67%). 74% of employees have at least the first-level university degree.
Employees from Generation Y (millennials) are the largest population. The average age is 40 years and 7 months.
2. Remuneration policy and bonus schemes
Scope and perimeter of the remuneration policy
The rules for remunerating employees are set out in the Remuneration Policy of Santander Bank Polska Group, which covers employees of the Bank and
its subsidiaries, including identified employees (known as material risk takers, i.e. employees whose professional activity has a significant impact on the
risk profile of the organisation) excluding members of the Management and Supervisory Boards. The remuneration for members of the management and
supervisory bodies is governed by separate policies described in Chapter XIII “Statement on corporate governance in 2023”, Part 4 “Governing bodies”.
The Group’s remuneration policy covers a wide range of topics. It defines the rules for determining fixed and variable remuneration, awarding bonuses
for sales staff, identifying and awarding bonuses to material risk takers in the Group, determining remuneration of control function employees and
applying malus clauses (identification, assessment and ex-post adjustment to variable remuneration payable to material risk takers of the Group).
The purpose of the policy is to support long-term sustainable growth of the Group by ensuring that employees are adequately remunerated and
effectively motivated to deliver best results and to achieve the strategic goals. The remuneration system is consistent with the interests of key
stakeholder groups (shareholders, employees, customers and communities) and supports long-term value creation, while taking into account such
aspects as risk management, strategy, interests of the organisation, capital requirements and corporate culture. The practices related to the remuneration
policy are gender neutral. They allow the Group to recruit and retain top talents using a competitive remuneration package including base salary, bonus
schemes and attractive benefits.
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Changes to the remuneration policy
In 2023, the Remuneration Policy was reviewed and the following minor changes were introduced:
Amendment of provisions concerning guaranteed remuneration (general rules).
Clarification of retention plans.
Introduction of a rule according to which variable remuneration can only be paid to an employee with a valid employment contract as at the
end of the reference period (unless stipulated otherwise).
Other minor changes connected with the updated regulations concerning remuneration rules or refining them.
Fixed remuneration
The key component of remuneration at Santander Bank Polska S.A. is the base salary, which is determined on the basis of the role performed, scope of
responsibility, qualifications and experience. In its approach to job valuation, the Bank’s remuneration unit uses best market practice to ensure
competitiveness of remuneration.
In response to dynamic changes in the labour market, the Group’s remuneration system is periodically reviewed using payroll reports of leading advisory
companies and data published by Statistics Poland (GUS). Salary review is a standard element of the Bank’s management, recognition and talent
acquisition/ retention. The main objective of the process is to increase the pay of the lowest earners, reward contribution to the Bank’s digital
transformation and strategic projects and initiatives, reward top performers and employees acting in line with corporate values, benchmark base salaries
of the Bank’s units, and ensure equal pay for women and men performing the same roles.
The last comprehensive review of base salaries took place in Q3 2023, leading to pay rises for a significant number of the Bank’s employees. This way,
the Bank increased the competitiveness of remuneration and reduced the gender pay gap as part of the remuneration strategy.
The previous salary review took place in Q3 2022, leading to pay rises.
Variable remuneration
Variable components of remuneration
The employees of Santander Bank Polska Group are subject to bonus schemes based on which they are awarded variable remuneration. The bonus
schemes increase staff motivation and support the delivery of strategic objectives set by the organisation. The awarding criteria and bonus levels are
strictly linked to business and qualitative results of the Group and individual employees, whose performance, delivery of objectives, behaviours and
engagement are reviewed on a regular basis.
The Group’s employees are set individual objectives that correspond to the activities of a given organisational unit. The objectives of the employees of
control units (internal audit, compliance area, risk management units and HR units) arise from the roles they perform and their remuneration does not
depend on the financial performance of business areas they control. In the case of the sales staff, in addition to quantitative and qualitative objectives
the performance review also covers the indicators related to customer service, risk management and compliance with the applicable regulations.
Variable remuneration depends on a bonus scheme relevant to a given employee (including bonus regulations for front-office staff, back-office staff and
employees of control units). Individual bonus schemes differ in terms of eligibility criteria, bonus amount and payment frequency. Bonus payment is
conditioned upon the delivery of specific quantitative objectives (e.g. a stated gross or net profit growth rate or amount, credit cost, NPL, RWA) and
satisfaction of qualitative criteria (e.g. customer satisfaction). It also has an option of awarding individual discretionary awards pursuant to the internal
regulations.
The rules for determination and payment of variable remuneration for material risk takers are presented in Chapter XIII “Statement on corporate
governance in 2023”, Part 5 “Remuneration policy”.
The overall variable remuneration cannot exceed 100% of fixed remuneration even in the case of an outstanding performance. However, in exceptional
cases, this limit may be increased to maximum 200% of fixed remuneration subject to the approval by the AGM.
Variable remuneration components also include long-term incentive plans addressed to key employees of the Bank. In 2023, there was five-year Incentive
Plan VII in place at the Bank. The Plan was introduced under resolution no. 30 of the Annual General Meeting of Santander Bank Polska S.A. held on 27
April 2022 and covers the employees of the Bank and its subsidiaries who significantly contribute to growth in the value of the organisation. The rules of
the Plan are described below.
The Group also offers additional benefits that suit employees’ needs such as: healthcare packages or the cafeteria system which provides a wide range
of cultural, sports and tourist benefits.
As the criteria stipulated in the bonus regulations were met, in 2023 the Bank’s employees were paid an annual bonus for 2022. Similarly to the last year,
the bonuses were paid in March.
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Incentive Plan VII
Rules
On 27 April 2022, Incentive Plan VII was established in Santander Bank Polska Group under resolution no. 30 of the Annual General Meeting. The Plan is
addressed to the employees of the Bank and its subsidiaries (excluding Santander Consumer Bank S.A.) who significantly contribute to growth in the
value of the organisation. Its purpose is to motivate the participants to achieve business and qualitative goals in line with the Group’s long-term strategy.
This mechanism is to strengthen the employees’ relationship with the Group and encourage them to act in its long-term interests.
The Plan obligatorily covers all persons with an identified employee status in Santander Bank Polska Group (material risk takers). Other key employees
indicated by the Management Board and approved by the Supervisory Board may participate in the Plan on a voluntary basis.
The Plan covers the period of five years (2022–2026). However, as the payment of variable remuneration is deferred, the share buyback and allocation
will be completed by 2033.
The participants are entitled to variable remuneration in the form of the Bank’s shares provided that they meet the terms and conditions stipulated in the
participation agreement and the resolution. To that end, Santander Bank Polska S.A. will buy back up to 2,331,000 shares from 1 January 2023 until 31
December 2033.
Participants who join the Plan are excluded from other incentive schemes applicable in the Bank and are not entitled to bonuses defined in the bonus
rules applicable at their units in a given year. This provision does not apply to material risk takers who receive variable remuneration in line with the Rules
for payment of variable remuneration to identified employees of Santander Bank Polska Group applicable in a given year.
Below are the vesting conditions that must be met jointly in a given year:
1) Delivery of at least 50% of the profit after tax target of Santander Bank Polska Group excluding Santander Consumer Bank S.A. (“SAN PL Group”) for
a given year.
2) Delivery of at least 80% of the team business targets for a given year at the level of SAN PL Group, Division or unit; the performance against the
target is calculated as the weighted average of performance against at least three business targets defined as part of the financial plan approved by
the Supervisory Board for a given year for SAN PL Group, Division or unit where the participant works, in particular:
a) PAT (profit after tax) of SAN PL Group;
b) ROTE (return on tangible equity expressed as a percentage) calculated in line with SAN PL Group’s reporting methodology;
c) NPS (Net Promoter Score) calculated in line with SAN PL Group’s reporting methodology;
d) RORWA (return on risk weighted assets) calculated in line with SAN PL Group’s reporting methodology;
e) number of customers;
f) number of digital customers.
3) The participant’s performance rating for a given year at the level not lower than 1.5 on the 1–4 rating scale.
In addition, at the Management Board’s request, the Supervisory Board decides to grant a retention award to a participant, if the following criteria are
met:
1) the participant’s average annual individual performance rating is at least 2.0 on the 1–4 rating scale during the period of their participation in Incentive
Plan VII;
2) the average annual weighted performance against the Bank’s targets in the years 2022–2026 is at least 80%, taking into account the following
weights:
a) 40% for the average annual performance against the PAT target;
b) 40% for the average annual performance against the RORWA target;
c) 20% for the average annual performance against the ESG target.
Control of the Incentive Plan in 2023
The Supervisory Board defines the list of participants at the Management Board’s request.
In each year of the Plan, the Supervisory Board sets the matrix of targets for Management Board members. Their achievement impacts the value of the
award granted. Likewise, in each year of the Plan, the Bank’s Management Board approves the matrix of targets for individual organisational units. The
value of the award depends on their delivery. The heads of individual organisational units set the matrix of targets and communicate it to the participants.
The entitlement to the award or retention award may be denied in part or in full if a conflict of interest is identified because an employee has put their
personal interests or the Bank’s interests before customer’s interests or has acted to the detriment of a customer.
The Supervisory Board may periodically review the list of participants, in particular in order to verify the rationale behind their further participation in the
Plan.
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Delivery of the Incentive Plan in 2023
In 2023, Santander Bank Polska S.A. implemented the resolutions of the Extraordinary General Meeting of 12 January 2023 authorising the Management
Board to buy back the Bank’s shares as part of Incentive Plan VII and establish a capital reserve for that purpose.
For the purpose of the Plan, in Q1 2023 Santander Bank Polska S.A. bought back 165,406 shares (of 207,000 shares eligible for buyback) with the value
of PLN 48,884,192 (from PLN 55,300,000 worth of capital reserve allocated to the delivery of the Plan for 2022).
All the above shares were transferred to individual brokerage accounts of the participants. As the number of shares bought back by the Bank was sufficient
to pay awards to the Incentive Plan VII participants for 2022, on 16 March 2023 the Bank’s Management Board adopted a resolution to end the buyback
in 2023.
As at 31 December 2023, the total amount recognised in the Group’s equity in line with IFRS 2 Share-based Payment was PLN 198.9m, including PLN
126.8m taken to staff expenses in 2023. As at 31 December 2023, PLN 48.2m worth of shares were transferred to employees.
Social and employee benefits
The Bank offers a broad range of employee benefits which help make it a more attractive workplace. Employees can use benefits which:
encourage them to lead a healthy lifestyle (e.g. Multisport card);
enhance their comfort and security (e.g. financial aid for employees in distress, group life insurance for employees and their families);
help achieve work-life balance (e.g. a cafeteria system offering a variety of tourist, sports, leisure, and culture options, which can be paid for
using points awarded to each employee).
The Bank’s employees have access to free private healthcare, including doctors of all specialties, laboratory testing, outpatient services, home visits and
rehabilitation. They can also purchase a medical package for their family members, a hospital package, a senior package and a continuation package after
termination of their employment with the Bank – all on attractive terms.
The Bank supports families with children, sponsoring school starter kits for children and teenagers up to the age of 18 and reimbursing the costs of care
over children in nurseries, kindergartens and children’s clubs, as well as summer, winter or day camps for children. The costs are reimbursed using points
available to employees as part of the Employee Benefit Fund.
In 2023, a range of initiatives were undertaken in relation to employee benefits.
The Bank carried out a tender for the selection of a healthcare provider. As part of a new offer, employees can choose a medical package for
themselves and their families and use a variety of new opportunities: a medical centre of their choice, reimbursement of medical costs,
approval of referrals from other providers than Medicover, extended vaccination package, increased limits of free consultations with a
psychologist, psychiatrist or physiotherapist and extended scope of manual therapy.
A new application for a medical package was implemented in the HR portal to speed up and digitalise the process.
Employees were provided with information and materials taking them through the change in the functionality and layout of the cafeteria
system.
More than 3,000 employees participated in webinars about employee benefits.
Materials about the employee benefit offer were published on Instagram, Facebook and LinkedIn (11 videos with more than 13 thousand
views) to attract potential job candidates.
It is the priority for Santander Bank Polska S.A. to create friendly and accessible workplace, therefore it steadily increases the range of benefits for
employees with disabilities. In 2023, the Bank introduced a full-time remote work option (where the job profile and work organisation permit) and
additional two days off for employees with mild disabilities.
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3. HR policy
Recruitment policy
Santander Bank Polska S.A. recruits new employees both internally and externally using methods and sources which are relevant to existing vacancies.
They include specialist recruitment portals, the Referrals Programme, recruitment agencies, PR campaigns and targeted recruitment campaigns in social
media, practical training and internships and cooperation with Santander Universidades.
The Bank’s employees have precedence over other candidates in the internal recruitment processes at Santander Bank Polska S.A. and the companies
from Santander Consumer Bank Group, which increases their development opportunities and helps build individual career paths.
The candidate profiles are checked to see if they meet the required job criteria in terms of their competencies, experience, knowledge, motivation,
personality and compatibility with the organisational culture. All persons involved in the recruitment process must comply with the business ethics
principles arising from the Labour Code and internal policies, in particular with the confidentiality and non-discrimination regulations.
The Referrals Programme of Santander Bank Polska S.A. engages employees in the recruitment process as it provides an opportunity to recommend
candidates for vacant job roles in the Bank. The system helps to reach a wider group of prospective employees who have relevant skills, aptitude and
motivation, and are interested in taking up a job at the Bank.
The Bank’s recruitment policy describes the recruitment process, establishes the criteria for defining recruitment needs and sets FTE limits.
Management of employee potential
In 2023, the potential of all employees in the organisation was identified and analysed. It is an essential part of the talent management process,
supporting the development of high performers in an even more effective and conscious way, including their career and succession planning,
maximisation of mobility opportunities and design of appropriate development initiatives.
This helps employees learn, develop and realise their potential, affecting their performance, engagement and job satisfaction.
Management by objectives
Santander Bank Polska S.A. has an objectives management process in place which supports delivery of strategic objectives and staff development and
promotes attitudes in accordance with the Simple, Personal and Fair values and five corporate behaviours. This standardised process is applied across
Santander Group and takes into account the Bank’s key priorities. It allows for flexibility (as the objectives can be modified along the way) and for
communication efficiency (as it facilitates communication between employees and their line managers due to more frequent meetings, regular feedback,
and support of the OneHR system).
The model was introduced in 2022 and consists of three dimensions: WHAT (individual objectives linked to the Bank’s strategic goals), HOW (the way the
objectives are delivered, taking into account the TEAMS corporate behaviours as well as personal and team development) and RISK (personal
responsibility for managing all risks related to one’s job role and for building risk culture). In 2023, the process was supported by guidelines, newsletters,
webinars, meetings and training sessions for managers and employees. A dedicated website was set up with materials for employees. The process helps
increase employees’ awareness of their impact on the delivery of the Bank’s strategy.
Changes arising from the amended Labour Code
Hybrid work
Since September 2022, employees of the Business Support Centre have worked in a hybrid model, combining onsite and remote work. This arrangement
flexibly responds to the expectations of employees and the organisation.
In April 2023, the Labour Code was amended to include provisions on remote work which became a common work model during the Covid-19 pandemic.
They supersede the previous provisions arising from the emergency legislation. On 7 April 2023, the Bank and trade unions signed an agreement on
remote work, setting out, among other things, the rules for settling costs directly related to teleworking. The wording of the document was agreed in
accordance with Article 67
20
of the Labour Code, taking into account the hybrid model applicable at the Bank.
Convenient self-service tools were implemented to support employees and managers in fulfilling formal requirements and managing the hybrid work
(statements, applications for remote work, solutions for selected groups of employees, e.g. parents of children with disabilities).
In Q3 2023, a quarterly remote work allowance was paid out for the first time.
Other statutory changes
In April 2023, the provisions of the Labour Code transposing the EU directive on work-life balance for parents and carers and the EU directive on
transparent and predictable working conditions in the European Union entered into force. They introduced changes to the rules for terminating fixed-
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term contracts, granting parental leaves and paying maternity allowance, extended employers’ information obligations towards employees, and
introduced two new types of justified absence (carers’ leave and absence on the grounds of force majeure).
4. HR development directions
In 2023, Santander Bank Polska Group continued to transform its corporate culture based on the HR strategy of employee focus. As the Group’s ambition
is to become the employer of choice in the banking sector, its employer branding activities are focused on increasing employee satisfaction, engagement
and loyalty.
The effectiveness of the HR strategy is confirmed by the results of employee satisfaction surveys and accolades granted to the Bank:
In 2023, the Bank conducted three waves of the Your Voice survey, reporting a record increase in eNPS (Employee Net Promoter Score) and employee
engagement.
The Bank was awarded the title of Top Employer 2023 by Top Employers Institute (January 2023) and received the Great Place to Work! certificate
based on an employee survey conducted by an independent research company (June 2023).
Below are the main HR initiatives in individual areas:
Focus on employee experience
As employee satisfaction is key to ensuring an outstanding customer journey, the Group focuses on creating
positive experience on each stage of the employee lifecycle. HR centres of excellence continuously improved
recruitment, talent development, manageme
nt by objectives and communication processes. HR tools were
further digitalised to enhance user experience by simplifying and optimising solutions and promoting self-service
channels.
A range of initiatives were undertaken as part of Hot Spots (interdisciplinary HR projects led by managers from
various units of the Bank) in relation to financial and non-financial recognition, well-being, promotion of products
and benefits for employees and improvement of the onboarding process. The management of Hot Spots was
optimised through the use of service design data and methodology. The so-called Gain Spots were defined for
2024 based on employer-related areas indicated by employees as particularly important.
The Bank systemically integrates the employee dimension into the business agenda to ensure that employee
experience is considered during the implementation of new processes and initiatives (through the Employee
Effort Score).
Talent development
The Group continued to pursue the strategy focused on talent development. In 2023, a range of development
programmes were delivered for leaders and specialists and new online academies were launched (including those
focused on the development of agile competencies).
Talent development is based on the Global Mobility Policy and covers two main programmes: Mundo and SWAP.
The Bank ensures business continuity and creates development plans in connection with internal recruitment and
mobility. It provides employees with op
portunities to expand their competencies and to share knowledge and
experience in an international environment.
It promotes leadership attitudes and behaviours as part of short- and long-term succession planning. It takes
regular measures to ensure it has the right talent in place to fill key roles and positions at the Bank. It ensures
employment diversity in terms of geography, business unit and gender.
Leadership development
Wise and mature leadership is critical to delivery of business objectives and effectiveness of that process. To
ensure great leadership, the Bank provides consistent and structured development programmes for senior
executives. The purpose is to transform the leadership culture.
In recent years, the development initiatives for senior managers have focused on human-centred leadership,
trust, emotional safety and courage.
In 2023, comprehensive development initiatives were continued, including:
Leadership Espresso – regular meetings held by senior managers to share knowledge and experience.
Peer Group – a closed and steady group of leaders participating in the programme of regular workshops
aimed at development, experience sharing, and providing real support in everyday business challenges.
Conversations that Matter – one-to-
one meetings between managers and experts from the Leadership
Development Office, whose purpose is to support development of human-centred leadership, expand
coaching skills and build self-awareness.
Elevate – a global learning ecosystem for senior executives. The aim of the programme is to carry out a
business transformation and build a common culture through continuous learning and in close cooperation
with colleagues from Santander Group.
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Digitalisation – continuation of
the paperless strategy
In line with the Bank’s paperless strategy, since 1 March 2023 all employee files have been available in a digital
form.
Starting from Q4 2023, the Bank’s employees can access the e-File (e-Teczka) in the self-service HR portal. The
above solution and the already implemented e-Signature allows the Bank to process employee documents 100%
online (with minor exceptions). This way, the Bank is one of the leaders of digital HR solutions in the Polish
ba
nking market. Thanks to digitalisation and automation of processes, the workload of HR units and paper
consumptions have been significantly reduced.
Continuous development and
improvement of HR services for
employees
The Bank’s HR systems are continuously developed and adapted to changing regulatory requirements in order to
provide employees with effective HR services and fast and user-friendly access to self-service functionalities (e.g.
solutions related to remote work, GDPR and work-life balance directive; system changes ensuring compliance
with amended tax regulations, etc.).
To ensure that employees can conveniently deal with HR matters (including regulatory ones), the range of
solutions available online was expanded to include:
Online application for remote work integrated with e-Signature and automatically transferred to e-File.
Online application for changing a medical package or expanding its scope to include a family member.
Online application for an earlier referral for occupational health assessment and a solution for simple
reimbursement of costs related to purchase of prescription glasses or contact lenses.
Application for registering copyrighted work subject to 50% of tax-deductible costs, directly affecting the
remuneration payable to employees.
Corporate culture
The Bank carried out a range of initiatives to support the transformation of the corporate culture.
Work was underway to embed the modified corporate behaviours (forming an acronym: TEAMS) in day-to-day
activities. The knowledge of the behaviours was cascaded down through the organisation, starting from the top
management through middle management to emp
loyees. Between February and June 2023, the series of
initiatives called “Months with Behaviours” took place to foster the corporate culture among employees. Each
month was dedicated to one behaviour.
The Family Day was organised to support diversity. 320 children of the Bank’s employees took part in the event
in the four headquarter locations and 161 branches and partner outlets. Digitalisation and ecology were the main
themes of the event.
The Bank provides starter kits for employees’ newborns. It also offers various initiatives for retiring employees.
Measures are put in place to foster the culture of appreciation and recognition. Outstanding performance of
employees is recognised
by the Chairman of Santander Group. The Appreciation Day was organised, along with
initiatives for managers promoting employee appreciation and recognition. A series of videocasts on that subject
were recorded and posted in internal channels and on LinkedIn.
Diversity
To promote diversity, equity and inclusion, the Bank supported the development of employee networks.
Currently, there are seven networks with 600 members (Embrace, Differently Abled, Neurodiverse, Silvers,
Parents, Santander Women, Santander IT from Female
Perspective) and seven Diversity Ambassadors. The
employee networks organised various initiatives to celebrate the Diversity Month.
The Bank cooperates with Vital Voices, UNGCNP and Forbes Women.
To overcome barriers in everyday communication and cooperation, employees could participate in a sign language
course, which started in September to celebrate the International Week of the Deaf and the International Day of
Sign Languages.
Ethics in employee relations –
building employee trust
In 2023, further measures were taken to prevent workplace misconduct. Educational activities were carried out
to raise the awareness of unwanted behaviours in the workplace and inform employees what to do if they
experience or witness them and where to fin
d help. These activities included a series of articles (e.g.
(“Discrimination –
what do I know about it?”), meetings with external experts (e.g. “Strength in numbers: how to
support each other in difficult employee situations”) and educational materials for managers (e.g. “Workplace
Diagnostics”) and provide guidance on how to manage difficult situations concerning employee relations.
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Workplace health and safety
To facilitate communication about the health and safety at work, “One pager for managers” was prepared to
provide key information about their responsibilities in that area. The “Health and Safety Quarterly” was published
for branch managers.
In April 2023, the Bank implemented new guidelines on remote work arising from the amended Labour Code,
including:
assessment of occupational risk for remote workstations;
organisation of a remote workstation in line with the safety requirements;
updated periodic occupational health and safety training for office employees working from home;
meetings between health and safety experts and office employees to share knowledge and experience
concerning new guidelines on remote work, post-accident procedure, work ergonomics, and workstation
design to meet the needs of neurodiverse employees.
Santander Bank Polska S.A. is Poland’s first bank to join the Occupational Work and Safety Forum at the Central
Institute for Labour Protection bringing together organisations promoting safe working conditions.
Management Board’s
Roadshow
In March and April 2023, the Management Board organised the Roadshow: a series of meetings with employees
and customers across Poland. Management Board members met with more than a thousand leaders to discuss
the Bank’s objectives and priorities for 2023 a
s well as leadership, i.e. the role of managers in delivering those
goals. It is an important step to build trust, effectively communicate and ensure that employees at each
organisational level have full understanding of measures taken by the Bank.
Extensive employer branding
initiatives
Employer branding measures were continued to promote the Bank as a great place to work. Two new image-
building and recruitment campaigns were launched: 1) “Let’s combine our powers”: a campaign run across all
distribution channels (branches, Select line, Multichannel Communication Centre, agent network, partner
outlets); 2) “Backend: behind the scenes”: a campaign promoting the knowledge of banking IT among candidates
and employees. The Bank’s employees participated in both campaigns as brand ambassadors.
5. Training and development
Nearly 12 thousand attendees took part in various training sessions and workshops in 2023 organised by the Bank. Training is available both onsite and
online. As part of remote training, employees have access to the DOJO platform including a variety of materials from renowned sources such as LinkedIn
Learning. The Bank systematically develops its e-learning courses to ensure the best experience to their users.
Specialist and managers at different levels can participate in development programmes. The focus is placed on specialist competencies that are necessary
to effectively carry out tasks within individual units. Social skills related to communication, creativity and cooperation are an important part of the training
agenda too.
Examples of training and development programmes:
Advisor of the Future – a programme for branch employees who want to develop their digital skills.
Leader Academy – a programme designed to develop leadership skills.
Leader’s Quest – a series of induction training sessions for new managers.
Co-financing of foreign language learning.
Mentoring and tutoring – knowledge sharing across the organisation.
At Santander Bank Polska S.A., managers of various levels steadily enhance their leadership skills. The initiatives in this regard are described in the table
above presenting HR initiatives.
Training in numbers
2023
2022
Average number of training hours per employee (Bank)
37.4 41.7
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Relations with customers
1. Service quality and customer experience management
Dynamic progress measured by the NPS
Customer experience is a key success factor and the main competitive advantage, particularly in the banking sector where services are easily comparable
due to regulations and technology. Alongside extensive changes in the market caused by pandemic-driven innovations and fintech solutions, customers
compare their experience from different sectors and their expectations are constantly growing.
The Bank is transforming its business by strengthening and improving relations with customers and their experience. It consistently develops skills, tools
and processes that support the areas which are key to customer experience. Customer-centric transformation covers both customer-facing areas and
service design teams.
The Bank’s ambition is to become a market leader based on the quality and depth of relationships with customers reflected not only in their satisfaction
with individual service areas but also in the likelihood they would recommend the Bank as a whole (NPS). The NPS is a key measure of how well the Bank
caters for customers’ needs and how satisfied customers are. It is used to assess the progress in delivery of enhanced customer experience.
The Bank has developed and steadily pursues the customer experience management strategy. The Bank projects the impact of the key initiatives on
customer satisfaction measured by the NPS and defines customer impact metrics. Once a month, the Customer Forum is convened to discuss NPS results
for individual business segments and identify key factors for customer satisfaction. The Forum is also a platform for sharing experience and ideas on how
to build customer experience.
Santander Bank Polska S.A. is among the top three banks in Poland in terms of mass customer experience
management. Customers appreciate, among other things, the quality of banking services and security. One of the
key assessment criteria and an important area of competitors’ activities in this respect is the accessibility and
functionality of the mobile application. In September 2023, all personal customers of the Bank were transferred to
the new Santander mobile application.
In 2023, Santander Bank Polska S.A. was in TOP3 position in the segment of high-net-worth customers
and in TOP2 position in the segment of SMEs.
Total Experience – next step in experience management
In 2019, the Bank started the customer-centric transformation, which was refined in 2023 to account for the importance of employee experience. It is
the next step towards ensuring unparalleled experience for customers.
It is what total experience is about.
The key to building true partnerships with customers is to understand how to incorporate emotions in total experience. Satisfied employees mean
more satisfied customers. The Bank wants its employees to use its products and services and to be Santander brand ambassadors.
The customer-centric standards have been developed to account for the total experience perspective.
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Customer-centric standards – development in 2023
Teams which create key customer solutions developed their research and design
skills.
Tools were put in place to facilitate customer surveys.
Compass Leaders were appointed in business units to supervise and support the use of
Compass standards (e.g. to monitor the use of Compass in Jira).
The Compass Guild was set up to bring together the community members and
facilitate experience sharing.
In 2023, the following initiatives were undertaken:
The customer service materials were modified and standardised in relation to the
following products:
debit and credit cards
mortgage loans
accounts
insurance.
New rules were implemented for preparation of terms and conditions of special offers
and products.
The style of communication was tailored to the way the Bank’s customers
communicate. The Bank’s ambition is to be a reliable partner for every customer.
Communication with customers conveys emotions and helps build customer trust.
The Bank developed guidelines for preparation of documents for people with special
needs.
The standard was developed to include elements which account for customers’ needs
on the one hand, and the prevailing trends on the other:
the Bank goes the extra mile in its relationships with customers;
the Bank respects diversity in terms of race, age, net worth, sexual
orientation and gender identity so that every customer can feel included;
the Bank promotes cybersecurity rules to help customers stay safe online;
the Bank offers modern paperless service solutions which support
sustainable development;
the Bank communicates with customers using simple and easy-to-
understand language.
Measures were taken to inform customers about the Bank’s corporate giving
initiatives and encourage them to take part.
Guidelines were introduced on how to support customers in distress and maintain
emotional balance.
The qualitative and quantitative survey standard enables the Bank to comprehensively
prepare for a survey with the participation of customers. It explains what needs to be
done before, during and after the survey.
The survey standard includes:
standardised questions and scale for primary indicators
basic assumptions for generating customer databases for surveys.
Surveys are one of the forms of contact with customers, it is therefore important to
ensure that they are carried out in a consistent way. Standardised questions take into
account plain language principles. They are ready-to-use templates with the
description of the question wording and the scale used for the question.
Compass product and
service design standard
Plain language standard
Empathic customer service
standard
Survey standard
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2. Complaints management
Customers of Santander Bank Polska S.A. may file complaints at their convenience: in branch, by mail, by phone or via electronic banking, including via
video call or chat.
In 2023, 74% of complaints were filed in remote channels.
Responses to complaints are provided in the customer’s preferred form: by letter, text message or via online and mobile banking. Text messages are used
to acknowledge receipt of the complaint, close the case and communicate the form of providing response. If the case takes more than five (and
subsequently ten) days to process, a text message is also sent to communicate that fact to the customer.
In 2023, 86% of replies were sent electronically.
In 2023, the quality of responses was further improved and measures were continued to shorten the turnaround times. The Bank takes efforts to ensure
that responses are clear and comprehensive. Banking jargon and complicated language are avoided. Robots are used in the complaint handling processes,
which significantly reduces turnaround times.
Effectiveness of complaints handling in 2023
67% of cases were resolved within three business days.
27% of cases were resolved at first contact by authorised
Bank employees who had received the complaint. It means that the decision was
communicated to the customer immediately after filing the complaint.
96% of cases were processed as part of the simplified procedure and resolved within one business day.
The complaint handling process meets regulatory requirements. The quality and speed of complaint handling and customer satisfaction (measured by
surveys) are verified on a regular basis. All conclusions and results of analyses and surveys are implemented across the organisation and used to enhance
the entire complaint handling process (from the moment of filing the complaint to its resolution). Customers who are not satisfied with the resolution
may appeal to the Customer Care Officer, who provides the relevant support.
3. Barrier-free banking and digital solutions
For 13 years, Santander Bank Polska S.A. has delivered the “Barrier-Free Banking” (“Obsługa bez Barier”) programme, designed to ensure access to the
Bank’s services and products for customers with diverse needs (people with disabilities, the elderly). The Bank steadily improves accessibility using
advanced technologies and ensuring appropriate conditions in traditional branches. Inclusive banking is one of the pillars of the Responsible Banking
strategy.
Barrier-free banking
All branches and partner outlets adhere to the barrier-free banking standards which take into account diverse customer needs, including the needs of
people with disabilities. At branches, customers may use priority-service points. There are mini magnifying glasses and signature frames for blind or
visually-impaired customers. At each outlet and branch, hearing-impaired customers may talk online with the Bank’s advisor who uses Polish Sign
Language. This option is also available via Santander mobile, Santander internet and the Bank’s website.
Barrier-free branches
The Bank conducts regular audits at branches to make sure they are accessible to customers with disabilities. At present, nearly 45% of the Bank’s
branches (143) are certified for architectural accessibility for customers with disabilities. 100% of branches have solutions for visually impaired people
and offer support of an advisor who speaks Polish Sign Language.
56 branches are equipped with portable induction loops, i.e. devices which facilitate interactions with customers who use hearing aids.
The Bank equipped 23 branches with tactile paths and 15 ones with typhlographic maps in Braille with a bell to be rung for assistance, and the TOTUPOINT
navigation and information system. These solutions support spatial awareness and increase safety for people with visual impairment. They are an integral
part of the barrier-free branch design standard.
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There are special procedures in place regarding statements of will made by customers who cannot read and/or write.
Barrier-free remote channels
Special solutions were also implemented in remote channels. Online and mobile banking services are regularly developed and audited in terms of
accessibility for customers with disabilities. Users can log into the mobile app using Face ID or Touch ID. Contact Centre (helpline) uses voice recognition,
an option that is also available as part of the IVR.
Customers calling 1 9999 can use Call Steering, a technology that recognises and interprets speech and gets callers to the right destination based on their
responses. CS shortens call times, reduces times to be connected with a customer advisor and increases customer satisfaction.
96% ATMs of Santander Bank Polska S.A. have features that make them more accessible to people with different needs. They include e.g. an audio system
(“talking” ATMs), a high-contrast mode, a screen switch-off mode and Braille symbols.
The Bank offers a card with a blind notch on the side, which makes it easier to use for blind and partially sighted people when using ATMs or making
payments. The card design was reviewed by the Royal National Institute for the Blind.
Barrier-free communication
The Bank’s advertising messages are adapted to the needs of the visually and hearing impaired. The videos published on the website of the Barrier-Free
Banking Programme and the Bank’s YouTube channel are available with subtitles, audio description (voice-over) and translation by the Polish Sign
Language interpreter.
In accordance with the Polish Accessibility Act of 19 July 2019, the Bank also provides an option to request the accessible documents (e.g. non-
personalised contract templates, terms and conditions) remotely or in branches.
Differently Abled project
Santander Bank Polska S.A. runs the Differently Abled project in accordance with one of its priorities that is to create an inclusive and diverse work
environment. The Bank conducts various educational activities to ensure the organisation is prepared to employ people with disabilities and to raise the
awareness of the rights and needs of this employee group.
The Bank is also a founding member of the Business Accessibility Forum, a platform for discussion of matters arising from the European Accessibility Act
to support and inspire Polish businesses to improve the accessibility of products and services.
In 2023, the Bank ran regular communication and education campaigns addressed to its employees and customers, through training sessions, meetings
and webinars with experts as well as social media campaigns.
4. Customer relationship management solutions
In H2 2023, the activities in the Xsell CRM area focused on the use of new sales opportunities in the mobile application. The new mobile application
launched in Q3 2023 allowed the Bank to reach more active customers in the digital channels. Thanks to additional features, the Bank presented
customers with a broader range of personalised products. Information from the mobile application was also used to run campaigns aimed at re-engaging
customers and persuading them to apply for a product in the mobile channel. The majority of these measures were based on real-time communication
mechanisms.
Santander Bank Polska S.A. implemented new campaigns designed to reward active personal customers, enhancing their banking experience. The Bank
more actively communicated with SME customers using digital and assisted channels.
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VII. Investor relations
1. Investor relations at Santander Bank Polska S.A.
The ambition of Investor Relations at Santander Bank Polska S.A. is to maintain best-in-class standards of communication with
capital market participants in Poland and abroad. The Bank is focused on providing accurate and transparent information, while
ensuring a level playing field for all stakeholders.
Santander Bank Polska S.A. is the second bank in Poland in terms of market capitalisation (as at 31 December 2023) and as a company listed on the
Warsaw Stock Exchange it actively communicates with its stakeholders in order to satisfy their information needs in accordance with the highest market
standards, applicable law and best practice.
Particularly important to the Bank is the communication with shareholders, investors and analysts. Santander Bank Polska S.A. makes best efforts to
provide the above market participants with regular and timely access to high quality and clear information in order to facilitate the accurate assessment
of the Bank’s and the Group’s financial standing, market position and effectiveness of their strategy and business model.
The Bank’s Investor Relations unit maintains relationships with institutional investors and stock market analysts, informing them about the development
and financial performance of Santander Bank Polska Group and other relevant aspects which may affect investment decisions. It also responds to
questions about the current situation of the company. The above activities aim to ensure adequate transparency, earn trust and build the Bank’s reputation
in the capital market.
In 2023, the following initiatives were undertaken as part of standard investor relations activities:
Four conference calls were held to present market analysts with the Bank’s quarterly results. In line with best market practice, they were open to
everyone interested and were broadcast online in Polish and English. The recordings are available on the Bank’s website at https://bank.
santander.pl/relacje-inwestorskie/serwis-relacjiinwestorskich.html.
The representatives of the Bank’s Management Board and the Investor Relations Office organised regular meetings with investors and stock market
analysts (around 130 ones held in 2023).
The Bank’s representatives took part in eight conferences organised by various Polish and foreign brokerage offices.
At the end of 2023, 15 analysts from Polish and foreign financial institutions prepared and published reports and recommendations concerning the Bank’s
shares.
All information published by the Bank (concerning both current and past years) is available on the website of the Bank’s Investor Relations
(https://bank.santander.pl/relacje-inwestorskie/ serwis-relacji-inwestorskich.html) The Investor Relations website also includes the “Best Practice” tab
with detailed information on how the Bank applies the principles contained in Best Practice for GPW Listed Companies 2021 (https://www.
santander.pl/relacje-inwestorskie/dobre-praktyki).
2. Share capital, ownership structure and share price
Ownership structure in 2023 and the majority shareholder
As at 31 December 2023, the share capital of Santander Bank Polska S.A. totalled PLN 1,021,893,140, divided into 102,189,314 ordinary bearer shares
with a nominal value of PLN 10 each.
The number of shares and votes held by individual shareholders as at the end of 2022 and 2023 is presented in the table included in Chapter XIII
“Statement on corporate governance in 2023”, Section 2 “Issuer’s securities”.
Majority shareholder
The profile of Banco Santander S.A. and its Group is presented in Chapter II “Basic information about the Bank and Santander Bank Polska Group”, Section
1 “History, ownership structure and profile”.
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3. Share price of Santander Bank Polska S.A. vs the market
> Share price of Santander Bank Polska S.A. and trading volumes in 2022 and 2023
0,00
100,00
200,00
300,00
400,00
500,00
0
200000
400000
600000
31-Dec-2021
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28-Feb-2022
31-Mar-2022
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31-Jul-2023
31-Aug-2023
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30-Nov-2023
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Price of Santander Bank Polska shares and their stock exchange trading volumes in 2022 and 2023
Share Turnover (number of shares) - left axis
Price of Santander Bank Polska Shares (PLNm) - right axis
Key data on shares of Santander Bank Polska S.A. Unit 31.12.2023 31.12.2022
Total number of shares at the end of the period
item
102 189 314
102 189 314
Nominal value per share
PLN
10,00
10,00
Closing share price at the end of the reporting period
PLN
489,80
259,40
Ytd change
%
+88,8%
-25,6%
Highest closing share price Ytd
PLN
496,20
385,00
Date of the highest closing share price
-
27.12.2023
12.01.2022
Lowest closing share price Ytd
PLN
256,0
191,70
Date of the lowest closing share price
-
2.01.2023
10.10.2022
P/E for 12 months at the end of the period (Bank)
-
10,71
10,82
P/E for 12 months at the end of the period (Group)
-
10,36
9,47
Basic earnings per share for the reporting period (Bank)
PLN
45,73
23,97
Basic earnings per share for the reporting period (Group)
PLN
47,28
27,39
Capitalisation at the end of the period
PLN m
50 052,33
26 507,91
Average trading volume per session (PLN m)
PLN m
70 208
72 485
Dividend per share paid
1)
PLN
23,25
2,68
Dividend record date
-
22.12.2023
25.05.2022
Dividend payment date
-
29.12.2023
01.06.2022
1) For more information, see the “Dividend” section below.
Unlike the previous year, 2023 turned out to be a remarkable year for the banking sector. While the first quarter was still marked by the problems of US
regional banks and the CJEU ruling on CHF loans unfavourable to Polish banks, the subsequent months saw a strong recovery of the demand, with WIG-
Banks (industry index) increasing by no less than 76.9%. The share price of Santander Bank Polska S.A. fared even better, closing the year with an
impressive gain of 88.8%, making it one of the most profitable investments on WSE in 2023. The Bank’s share price was lowest on 20 March at PLN
253.20 and highest on 14 December at PLN 523.50, following the KNF’s approval of payment of an interim dividend from the profit for 2022 at PLN 23.25
per share.This outstanding performance was achieved due to, among other things, record high results reported by the Bank in the first three quarters of
2023. The entire banking sector benefited from the Monetary Policy Council’s decision to suspend interest rate cuts due to decelerated decline in inflation.
As a result, the cost of money in Poland remained elevated in mid-term, and the bullish conditions in the banking sector continued until the end of the
year. Market corrections in 2024, if any, will be offset by expectations of high dividends to be paid by banks from record profits earned in 2023.
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> Share price of Santander Bank Polska S.A. vs key indices
80
90
100
110
120
130
140
150
160
170
180
190
200
31-Dec-22 31-Jan-23
28-Feb-23 31-Mar-23 30-Apr-23 31-May-23 30-Jun-23
31-Jul-23 31-Aug-23 30-Sep-23 31-Oct-23 30-Nov-23 31-Dec-23
Share price of Santander Bank Polska S.A. vs. indices in 2023
Share price of Santander Bank Polska S.A., WIG, WIG20 and WIG Banki at 31.12.2022=100
Santander Bank Polska S.A. WIG20 WIG WIG Banki
4. Dividend
Dividend policy and profit distribution in 2023
Dividend from the net profit for 2022
In line with the KNF’s individual recommendation of 16 March 2023 regarding the dividend policy of Santander Bank Polska S.A., the Bank met the criteria
for distributing 100% of its net profit earned in 2022, with no adjustments made due to the credit portfolio quality. However, considering the uncertain
macroeconomic situation, in particular:
dynamic changes in the banking sector environment;
the risks to which the Bank is exposed, including the risk related to the CJEU’s judgment in case C-520/21;
potential deterioration of credit quality related to increased inflation, slowed economic growth as well as high debt service costs for borrowers;
need to ensure the Bank’s stable operations and further growth in the coming periods;
the KNF recommended that the Bank should not pay dividend from the profit for 2022 until the CJEU issues its judgment in case C-520/21, and after that
– it should consult the supervisory authority, also before taking any other measures which could reduce its own funds (in particular if they go beyond the
scope of the ordinary business and operational activity), including the distribution of the profit retained in previous years or buyback or redemption of the
Bank’s shares.
Taking into consideration the macroeconomic situation as well as the KNF’s recommendations and stance, on 22 March 2023 the Management Board of
Santander Bank Polska S.A. recommended that:
the profit of PLN 2,449,042,525.50 earned in 2022 be distributed as follows:
• PLN 72,357,000.00 to be allocated to the capital reserve;
• PLN 2,376,685,525.50 to be allocated to the dividend reserve;
the amount of PLN 840,886,574.78 representing the undistributed profit earned on the sale of shares in AVIVA insurance companies and posted
under other comprehensive income be allocated to the dividend reserve.
The profit distribution recommended to the Annual General Meeting did not preclude the Management Board’s potential decision to distribute profit to
the shareholders in the form of interim dividend and to use the dividend reserve for that purpose pursuant to the authorisation given to the Management
Board in accordance with § 50(4) of the Bank’s Statutes. The above was subject to a positive opinion of the KNF (to be obtained after the CJEU’s judgment
in case C-520/21) and adequate economic and market conditions.
On 19 April 2023, the Bank’s Annual General Meeting adopted a resolution on profit distribution and decided to increase the capital reserve as
recommended by the Management Board.
On 25 October 2023, the Management Board of Santander Bank Polska S.A. received a letter from the KNF in which the supervisory authority stated that
it had analysed the business and financial standing of the Bank and the arguments presented by the Bank and did not have any reservations concerning
the payment of a dividend (interim dividend) of PLN 2,375,901,550.50 from the profit earned in 2022 (profit for 2022 of PLN 2,449,042,525.50 reduced
by the amount of PLN 72,357,000 allocated to the capital reserve and the amount of PLN 783,975 to be deducted to ensure that the quotient of the
amount to be paid out as dividend and the number of shares is expressed in full grosz (one hundredth of the zloty)).
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Decision of Santander Bank Polska S.A. Management Board on the payout of an interim dividend
On 16 November 2023, the Management Board of Santander Bank Polska S.A. advised that it decided to pay out an interim dividend for the accounting
year from 1 January 2023 to 31 December 2023 and to allocate PLN 2,375,901,550.50 for that purpose.
On 16 November 2023, the Bank’s Management Board received the Supervisory Board’s approval for paying out an interim dividend. The interim dividend
of PLN 23.25 per share was paid out on 29 December 2023 from part of the capital reserve set up for dividend payment (including interim dividend).
102,189,314 (one hundred and two million one hundred eighty nine thousand and three hundred fourteen) A, B, C, D, E, F, G, H, I, J, K, L, M, N and O series
shares gave entitlement to the interim dividend.
Dividend in 2022
In 2022, the dividend paid from the profit generated in 2021 was PLN 2.68 per share. It was paid out on 1 June 2022.
19,72 PLN
0,00 PLN
2,16 PLN
2,68 PLN
23,25 PLN
2019 2020 2021 2022 2023
Dividend per share paid out by Santander Bank Polska S.A.
in years 2019-2023*
14.06.2019
15.10.2021
1.06.2022
29.12.2023
∗ Santander Bank Polska S.A. pays dividends in accordance with the dividend policy in place, taking into account individual recommendations of the KNF in this respect.
5. Rating of Santander Bank Polska S.A.
Santander Bank Polska S.A. has bilateral credit rating agreements with Fitch Ratings and Moody’s Investors Service.
The tables below show the latest ratings assigned by the agencies to the Bank, which remained in effect on the date the Annual Report of Santander Bank
Polska Group for 2023 was authorised for issue.
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Ratings by Fitch Ratings
Rating category
Ratings
changed/affirmed
on 14.09.2022 and
6.09.2023
1)
Ratings changed/affirmed
on 5.08.2022
Ratings changed/affirmed on
11.06.2021 and 23.09.2021
Long-term Issuer Default Rating (long-term IDR)
BBB+ BBB+ BBB+
Outlook for the long-term IDR
stable
stable
stable
Short-term Issuer Default Rating (short-term IDR)
F2
F2
F2
Viability Rating (VR)
bbb
bbb+
placed on Rating Watch
Negative
bbb+
Support Rating - 2 2
Shareholder Support Rating bbb+ - -
National long-term rating AA(pol) AA(pol) AA(pol)
Outlook for the long-term IDR stable stable stable
National short-term rating
F1+(pol)
F1+(pol)
F1+(pol)
Long-term senior preferred debt rating
BBB+
BBB+
BBB+
Long-term senior non-preferred debt rating BBB - -
Short-term senior preferred debt rating
F2
F2
F2
1) Ratings of Santander Bank Polska S.A. applicable as at 31 December 2023
In its report of 6 September 2023, Fitch Ratings affirmed the ratings of Santander Bank Polska S.A.an, including the long-term Issuer Default Rating (IDR)
at BBB+ with a stable outlook and the Viability Rating (VR) at bbb.
According to Fitch Ratings, both long- and short-term IDR and SSR of the Bank were driven by a high probability of support from its parent, Banco
Santander S.A. (A-/Stable/a-), 2nd largest bank in terms of capitalisation in the eurozone and 27th globally (as at the end of June 2023). The one-notch
difference between long-term IDR of Santander Bank Polska S.A. and Banco Santander S.A. reflects the strategic importance of the Polish bank to the
parent. The stable outlook of the long-term IDR and the short-term IDR reflect the rating of the parent. The VR balances the Bank’s adequate capital
position, stable funding and liquidity profiles, robust earnings generation and reasonable asset quality against risks from the domestic operating
environment, which negatively affect banks’ business and risk profiles.
Ratings by Moody’s Investors Service
Rating category
Ratings affirmed on
20.12.2022
1)
Ratings upgraded
on 3.06.2019
Long-term/short-term counterparty risk rating A1/P-1
A1/P-1
Long-term/short-term deposit rating A2/P-1
A2/P-1
Outlook for long-term deposit rating stable
stable
Baseline credit assessment (BCA) baa2
baa2
Adjusted baseline credit assessment baa1
baa1
Long-term/short-term counterparty risk assessment A1 (cr)/P-1 (cr)
A1 (cr)/P-1 (cr)
Senior unsecured euro notes rating (EMTN Programme) (P) A3
(P) A3
1) Ratings of Santander Bank Polska S.A. applicable as at 31 December 2023
On 26 September 2023, Moody’s Investors Service updated its credit analysis of Santander Bank Polska S.A. (without taking any rating actions).
The A2/Prime-1 long-term and short-term deposit ratings and the A3 senior unsecured euro notes rating reflect the Bank’s Baseline Credit Assessment
(BCA) of baa2, the agency’s assumption of moderate parental support from Banco Santander S.A. in the case of problems, the advanced loss given failure
analysis, and the likelihood of support from the government if necessary.
The Bank’s baa2 BCA captures its good capitalisation, moderate asset risk and good profitability despite cost pressure and legal risk connected with the
CHF mortgage loan portfolio. It also reflects good liquidity and moderate market funding with some dependence on corporate deposits and derivative
exposure.
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The likelihood of support from Banco Santander S.A. also translates into a one-notch uplift in the Adjusted BCA to baa1 from the Assigned BCA of baa2.
The stable outlook on long-term deposit rating reflects the agency’s view that the Bank’s credit profile will remain broadly unchanged over the next 12–
18 months despite the difficult operating conditions. The stable outlook is also in line with that of its parent.
VIII. Relations with external environment
1. Responsible Banking/ ESG Strategy
The objective of sustainable and socially responsible development at Santander Bank Polska Group is to build a long-term value for all stakeholders.
The Group’s approach to corporate social responsibility and sustainable development is defined in the Responsible Banking Strategy, which is an integral
part of the Group’s overall business strategy and apart from Principles for Responsible Banking (PRB) takes into account the Environmental, Social and
Governance (ESG) factors.
The Responsible Banking Strategy is based on two key pillars: corporate culture and sustainable finance.
As part of sustainable finance, the Group pursues the objectives related to environmental protection and prevention of climate change, which are
increasingly important.
The Group aligns its Responsible Banking agenda with the challenges and requirements of society to help people and meet their needs in accordance
with the best international standards, in particular the Sustainable Development Goals (SDG), the Paris Agreement, the Principles for Responsible Banking
(PRB), and Net Zero Banking Alliance.
For details, please see Chapter XIV “Statement on non-financial information in 2023”.
2. Environmental impact of operations
Greenhouse gas emissions
Since 2020, the Bank has been neutral in terms of own carbon emissions. Energy is bought from renewable energy sources and emissions are offset by
carbon credits managed by Banco Santander Group on behalf of all subsidiaries. The Bank consistently pursued its Sustainability Policy, superseded by
the Responsible Banking and Sustainability Policy, and the Global Net Zero Strategy. It reduced emissions in own operations, including the use of energy,
business travel, use of company cars, etc. Since 2022, the offices of Santander Bank Polska S.A. has used zero-emission renewable electricity under a grid
contract with Tauron, as confirmed by the ECO Premium certificate from Tauron Group. 100% of electricity sold to the Bank is covered by the Green
Energy Sale Guarantee scheme and is generated from renewable energy sources (mainly hydroelectric power plants).
In 2023, the Bank improved the performance of santander.pl, reducing its carbon footprint by 70% and making it one of the fastest websites in Poland.
3. Communication with stakeholders
Relations with stakeholders
The Group identifies the key groups of stakeholders, updates their profiles and analyses their needs and mutual impact. It regularly communicates with
the stakeholders using various channels, such as sessions with the representatives of social partners , direct contacts, publication of reports and other
periodical information materials.
The Group analyses recommendations issued by the stakeholders and incorporates them into its processes. Special attention is paid to the voice of
customers, who are provided with products and services developed in accordance with the customer-centric model.
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> Stakeholders of Santander Bank Polska S.A. and its Group
ESG report
The Bank informs its stakeholders about its sustainable and CSR activities by means of a dedicated annual report and ESG webpage. In 2023, the tenth
report was prepared summarising the Group’s social, economic and environmental impact.
In 2023, the Group assessed the materiality of ESG aspects in accordance with the double materiality analysis required under the European Sustainability
Reporting Standards introduced by the Corporate Sustainability Reporting Directive (CSRD). The assessment covers the impacts of Santander Bank Polska
Group on the external environment (impact materiality) as well as external risks and opportunities for Santander Bank Polska Group (financial
materiality). The analysis of the impact and financial materiality allows the Group to identify material issues that are subsequently integrated into the
Group’s strategy and non-financial reporting.
As a result of the analysis, climate change, consumers and end-users, and business conduct were considered to be “significant” or “critical” areas, while
management staff and affected communities were classified as “informative” (potentially material) and subject to the disclosure in the report.
The results of the double materiality analysis were presented at the Responsible Banking and Corporate Culture Committee and approved by the Bank’s
Management Board. The key areas are incorporated in the “We help you achieve more” strategy for 2024–2026.
Marketing communication
Brand promise
Santander is a strong brand that is primarily associated with the global market presence. It is also perceived as a bank which makes everyday financial
management easier.
In 2023, the brand metrics ranked high. In December 2023, Santander was ranked fourth in terms of unaided brand awareness and in TOP5 in terms of
Top of Mind and First Choice.
In 2023, the Bank’s advertising campaigns received positive feedback, particularly in terms of general appeal, clarity of message and brand association.
Underlying message of marketing communication
‘
In 2023, the marketing communication presented Santander Bank Polska S.A. as a bank that helps its customers every day, not only with their financials.
It helps manage daily affairs, make dreams come true, run business and bank safely.
A strong focus was placed on non-financial matters that the Bank helps with. The brand communication allowed the Bank to strengthen its attribute as
a socially responsible bank and rank second in the Polish market in this respect.
These measures enhance the customer-centric strategy and improve the Bank’s NPS.
A bank that helps
Suppliers and business
partners
Banking organisations
and associations
Personal customers
Business customers
Employees
Shareholders and
investors
Regulatory bodies
Media and the public
Santander Group
Environment
Social partners
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Marketing campaigns
In 2023, the Bank delivered extensive communication activities in different channels. It launched 11 nationwide ATL marketing campaigns (TV, internet,
social media, radio, OOH, branches) targeted at various customer segments: millennials, families, teenagers and business enterprises. They featured the
new brand ambassador Piotr Adamczyk, who is well known among the Bank’s customers across all age groups.
ATL brand campaigns
For the first time since the rebranding, the Bank launched a major brand campaign: “Helping has many faces”. It showed how the Bank helps customers
and communities through various programmes (“Finansiaki”, “Barrier-Free Banking”), courses and scholarships (Santander Universidades) as well as
projects delivered by the Santander Foundation. The underlying message was that Santander helps with more than just finances.
ATL product campaigns for personal and SME customers
In November 2023, the Bank launched a big ATL/360 promotional campaign following the implementation of the new mobile application in September.
There were two editions:
“The new app helps you manage daily affairs” – an ad presenting the modern application with a new look and personalisation options.
“We help you bank safely” – with a focus on such features of the new mobile application as biometric login, Discreet Mode and the Cyber
Rescue service.
The Bank also ran a number of campaigns to promote products:
“Instant transfers are there when you need them” – a campaign promoting free-of-charge instant transfers, which are the source of the Bank’s
competitive advantage and an important factor to consider when choosing a bank.
“Santander helps you make your dreams come true” – a cash loan campaign addressed to mobile application users.
“Helping you discover the world on your own account” – a campaign promoting a bank account for children, offering them pocket money for a
start and encouraging them to become self-reliant (measures taken as part of the “Back to school” initiative).
Campaigns promoting savings products, with a particular focus on attractive interest rates on deposits:
“Power of saving” Max Savings Account campaign.
“Saving makes you worry less” Max Savings Account campaign.
Another edition of the Mobile Deposit promoted as part of the “Saving makes you worry less” campaign.
ATL campaigns for SME customers:
“Power of developing your business” campaign promoting a business account with a payment terminal in a mobile phone and access to a range
of e-services.
“Green idea” campaign promoting green finance and lease for solar panels, electric cars and charging stations, and “We help run your business
and reduce costs” campaign.
Campaigns on the radio
Radio campaigns were run to support brand activities as part of the “Helping has many faces” campaign and promote the Bank’s products. Campaigns for
personal customers focused on the savings account, Account for the Young (“Back to school”), Black Week loan and Christmas loan. Campaigns targeted
at SME customers promoted a business account with a bonus.
Social media
Social media presence and virtual user community
The Bank has been building a large and engaged virtual user community for years. It is present on six social media platforms (Facebook, Instagram,
YouTube, Twitter, TikTok, Linkedln). In 2023, 275 campaigns were run on Meta and TikTok, with the total reach of more than 312m page views.
TikTok was the most effective channel in 2023. Since setting up a profile a year ago, the Bank has manged to build an engaged community (the number
of followers increased eight-fold compared to 2022) and achieved a much greater reach at a much lower cost. It is currently the most dynamically
developing channel, which generates an average monthly reach of 5m.
In 2023, the Bank was ranked third in the Social Media category of the Golden Banker competition. Specialists evaluated the Bank’s effectiveness in
building the image of a socially responsible institution that communicates in a human way in the digital environment. The following areas were
assessed: strategy, consistency of message, creative selection of communication channels, customer relationship building and use of interactive
features.
Positive image in social media
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In 2023, compared with its peers, the Bank reported the highest sentiment ratio due to positive opinions posted on its fan page. The ratio declined
temporarily after the launch of a new mobile application, but was quickly restored to the top position thanks to the appropriate PR response.
Most engaging activities in the social media
In 2023, the most engaging areas in the social media included:
Image and sponsorship – particularly popular were the following initiatives and events: Santander Letnie Brzmienia summer music festival
sponsored by the Bank, League of Legends LEC and F1 sponsored by Santander Group, and CSR initiatives: “Green Ribbon #ForThePlanet”
(“Zielona Wstążka #DlaPlanety”), CSR Fairs, promotion of the CSR Report, International Day of Sign Languages, Day of the Deaf, Earth Hour
with WWF.
Education – cybersecurity is a regular element of the Bank’s educational activities in the social media: the “Fairy tales for adults” campaign,
which received several awards in 2022, continued to attract users’ attention, showing the importance of online security. The Bank also
promoted free training programmes and scholarships available as part of Santander Universidades.
Products and services – a regular communication campaign was run to promote My Goals and BLIK. The unique format attracted users’
attention and helped raise the awareness of the Bank’s services.
Social media were also used to promote other products and initiatives for personal and business customers (Account for the Young, discounts on insurance
products, Autopay, CyberRescue, Telemedico, Kanto Santander currency exchange platform, features of the new mobile application, Account Worth
Recommending, a series promoting eServices, webinars for entrepreneurs, “EmPOWERed in business” competition).
Optimisation of business profiles and customer reviews in Google Maps
In June 2023, the Bank started to improve the moderation of user reviews and optimise business profiles of branches, encouraging branch staff to ask
customers to post their reviews. The number of reviews increased from 563 in May to as many as 3,873 in November. Positive opinions account for
95% of all reviews.
Outreach and brand campaigns promoting Santander Account, Account for the Young, Account for SMEs and Santander
Universidades
In 2023, the Bank developed a strategy for outreach and brand activities in digital channels – these initiatives had a direct impact on awareness,
consideration and NPS and an indirect impact on sales activities.
The campaigns were addressed to mass customers, SMEs and young customers. The Bank launched the “Your English can be better” campaign dedicated
to the latter group, for the first time using the corporate identity aligned with the Group’s new CI.
4. Social responsibility
Santander Bank Polska Group participates in long-term social projects which not only respond to the needs of local communities but also make a positive
contribution to society. The section below presents sponsorship, corporate giving and corporate volunteering activities.
Key sponsorship projects in 2023
In 2023, the sponsorship initiatives of Santander Bank Polska S.A. focused on the following three main areas: education (particularly financial education),
culture and sports. The Bank continued long-term projects that give a bigger opportunity to create a lasting association between a given event and the
Bank. The Bank also became engaged in two new image-building projects related to culture, acting as the name sponsor for the Santander Letnie
Brzmienia summer music festival and as the patron of the “Picasso” temporary exhibition at the National Museum in Warsaw. The Bank also continued
the promotion and communication activities related to two global sponsorship projects of Santander Group: partnerships with Scuderia Ferrari and League
of Legends European Championship (LEC).
In 2023, the Santander Bank Polska S.A. Foundation implemented educational, charitable and cultural donation agreements with social partners. It also
supported employee volunteering.
Key sponsorship projects and activities of the Santander Bank Polska S.A. Foundation are described in detail in Chapter XIV "Statement on non-financial
information for 2023".
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IX. Business development in 2023
1. Group’s business management structure
Operating structure
Santander Bank Polska S.A., together with its non-banking subsidiaries, conducts its operations through the following central units: Retail Banking
Division, Business and Corporate Banking Division, and Corporate and Investment Banking Division.
Santander Consumer Bank Group (SCB Group), which specialises in consumer finance, forms a separate business segment with its own customer base,
product range and distribution channels.
Segment reporting
The business management structure presented above corresponds to business segments identified as part of segment reporting (Note 3 to the
Consolidated Financial Statements of Santander Bank Polska Group for 2023). They are complemented by the ALM and Central Operations segment,
which covers funding, management of strategic investments and transactions which generate expenses/ income that cannot be allocated to individual
segments.
The table below presents the business segments of Santander Bank Polska Group in three dimensions: customer profile, key product lines, and service
model.
Retail Banking
Segment
Business and
Corporate
Banking Segment
Corporate and
Investment
Banking Segment
ALM and Central
Operations
Segment
Santander
Consumer
Segment
Segment Area Operating model
RETAIL BANKING
Customer
profile
Personal customers (divided into Standard, Premium, Select and Private Banking customer segments
based on their diverse needs and expectations).
Micro, small and medium-sized companies (with annual turnover up to PLN 10m).
Key product
lines
Current and business accounts, savings products, consumer and mortgage loans, credit and debit cards,
insurance and investment products, clearing services, brokerage services, foreign payments, services for
high-net-worth customers, open banking services.
Business loans, business deposits, cash management, leasing facilities, factoring, payment orders, letters
of credit, collections and guarantees, payment terminals, additional online services, Kantor Santander
currency exchange platform.
Asset management services as part of investment funds.
Access to the global offer of Santander Group, third-party investment funds, and structured deposits for
Private Banking customers.
Service
model
Relationship-building, sales and after-sales contacts with retail customers through the network of
branches, partner outlets and remote channels (Multichannel Communication Centre, Santander internet
and Santander mobile).
Premium customers are serviced by dedicated advisors as part of their individual portfolios, based on a
personalised approach and regular contacts aimed at strengthening relationships and customer loyalty.
Private Banking and Select customers benefit from a personalised service model under which they can use
the support of a specialised advisor and the Select Line operating as part of the Multichannel
Communication Centre, which offers support via telephone. Private Banking customers are serviced by
over 60 Private Banking Directors operating from 24 locations around Poland, including four Private
Banking Centres.
SMEs are handled by SME advisors in branches and partner outlets. Business customers can also use the
services of the Multichannel Communication Centre as well as internet and mobile channels (Santander
mobile and dedicated services: Mini Firma, Moja Firma plus and iBiznes24).
Customers of Santander Brokerage Poland may invest via the Inwestor online system, Inwestor mobile
application, the Multichannel Communication Centre and at the Bank’s branches providing brokerage
services.
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Segment
Area
Operating model
BUSINESS AND CORPORATE BANKING
Customer
profile
Businesses and corporations with turnover of PLN 8m–PLN 1.2bn, local authorities and the public sector.
Key product
lines
Payment transactions, loans, deposits, cash management, leasing facilities, factoring, letters of credit and
guarantees.
Services to customers of other banks and financial institutions provided under agreements with those
institutions.
Service
model
Business customers are managed by the Business Clients Department and the Corporate Clients
Department. These units encompass six regional centres (three Business Banking Centres and three
Corporate Banking Centres) divided into 29 offices located across Poland.
Premium customers and entities from the public and commercial properties sector are handled by four
dedicated offices.
Customers have dedicated advisors who are responsible for the overall relationship. They are supported
by units specialised in transaction structuring, lending and product development.
Customers are provided with access to the Bank’s products and services via remote channels, including
internet and mobile iBiznes24 platform (featuring such modules as currency exchange and trade finance)
as well as contact centres which handle a wide range of operating processes (Business Service Centre,
SME Service Centre, and Trade Finance Service Centre).
CORPORATE AND INVESTMENT
BANKING
Customer
profile
Largest corporate customers allocated to that segment based on their turnover (nearly 250 of the largest
companies and groups).
Corporations serviced within the international Santander Corporate and Investment Banking structures.
Treasury, syndicated lending, and advisory services for customers of other Divisions.
Key product
lines
Transactional banking (including cash management), deposits, working capital finance, mid- and long-
term finance, leasing facilities, factoring, letters of credit, guarantees, and trade finance.
Project finance, syndicated loans, arranging and financing of securities issues, financial advisory services
(including those related to mergers and acquisitions), and brokerage services for financial institutions.
FX and interest rate risk hedging products (offered to all customers of the Bank).
Service
model
Customers of the Corporate and Investment Banking Segment have dedicated product specialists and
managers who are responsible for the overall relationship.
They are provided with access to the Bank’s products and services via remote channels, including internet
and mobile iBiznes24 platform, as well as dedicated call centres (Business Service Centre and Trade
Finance Service Centre).
SANTANDER CONSUMER
Customer
profile
Personal and business customers
Key product
lines
Instalment loans, cash loans (including consolidation loans), credit cards, online renewable limits, special-
purpose loans, car finance (refinance solutions, leasing facilities and leasing loans), business loans,
factoring and bank guarantees.
Term deposits and insurance products (mainly related to credit facilities).
Service
model
The bank sells its products through:
a network of own branches and franchise outlets, which offer cash loans, credit cards and retail
deposits;
a structure for mobile sales of car loans and leasing facilities;
a structure for mobile sales of corporate deposits;
a structure for mobile sales of instalment loans;
remote channels, i.e. a call centre and internet and mobile banking used to sell cash loans, credit
cards and instalment loans;
a network of partners offering the Bank’s car loans and leasing facilities (car dealers, second-hand
car dealers and intermediaries) as well as instalment loans and credit cards (retail chains and
stores);
a remote channel for car loans.
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2. Business development of Santander Bank Polska S.A. and non-banking
subsidiaries
2.1. Retail Banking Division
Main development directions
Strategic priorities of Santander Bank Polska S.A.:
Ensuring unparalleled experience for customers and employees.
Simplifying and digitalising products and processes.
Acquiring new customers and growing business, mainly in digital channels.
Delivering the “digital bank with branches” strategy addressed to mass customers (Mass and Premium) and high net worth customers (Select).
Strengthening the market position and image of the Bank as the best bank for business and retail customers.
Delivering projects in cooperation with Santander Group units (One Europe).
Other key focus areas:
Continued digitalisation of processes, including lending to personal customers, post-sales processes, income verification and the New to Bank
process.
Implementation of a new mobile application.
Delivery of the self-service branch strategy. Further optimisation of the brick-and-mortar distribution network.
Development of remote channels and growth of remote sales.
Improving profitability of products and optimising asset structure.
Introduction of new Santander Account, Santander Max Account and Santander Select Account, together with the Santander On the Go offer,
the discount platform and the “Price Advisor” option.
Extension of the offer for minors to include “My Goals” service and a debit card.
Focus on increasing credit volumes by optimising sales, products and support processes, resulting in an above-the-market growth of the
portfolio.
Introduction of a cash loan with ECO special offer and a carbon footprint tracker as part of delivery of the green agenda.
Top market position of Santander TFI in terms of net sales.
Effective management of product margins, increasing operational efficiency and net interest income.
Launch of ATM migration to Euronet and IT Card.
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The activities of individual Divisions are presented in the tables below.
Product line
for personal customers
Activities of the Retail Banking Division in 2023
Cash loans
In line with customers’ expectations, in 2023 the Bank focused on the development of digital processes related to post-
sales services for cash loan borrowers and continued to digitalise existing lending processes. As part of digitalisation,
the Bank implemented and developed graphic standards for people with disabilities.
Below are the new solutions implemented in sales and post-sales processes:
New to Bank – a fully remote cash loan application process for new customers with a Polish ID card that can
authenticate themselves using the available methods (including: eDO App and mObywatel). This way, Santander
Bank Polska S.A. can now identify the customer, grant them a loan and offer electronic banking services on a fully
remote basis.
Remote income verification – a functionality which makes it possible for customers to confirm their income online
without having to visit the Bank’s branch. Customers applying for a loan via Santander internet or Santander mobile
were provided with a possi
bility to confirm their income using the available methods, such as aggregating an
account with another bank using PSD2 or appending a document from PUE ZUS.
Management of the loan repayment schedule – a new post-sales process facilitating the management of loan
repayments. New and existing borrowers were offered three new, entirely remote functionalities: suspension of
the total principal and interest rate, reduction of instalment amounts (maximum three instalments) and extension
of the lending period by up to 12 months.
Sales and post-sales services in new Santander mobile – personalisation features of the new mobile application,
including customisation of home screen, discreet mode (hidden details of credit facilities, e.g. amounts), improved
user-friendliness.
Fixed-rate cash loan – the standard offer included a cash loan with a fixed interest rate for up to 120 months.
The Bank launched a range of pricing offers, including short-term online offers tailored to customers’ lifecycle and needs,
including:
Cash loan with ECO special offer for customers looking for financing for sustainable assets.
E-commerce offer addressed to customers checking lending terms in web browsers and loan comparison engines.
Industry offer for employees of selected companies.
During the year, the Bank adjusted its pricing policy in line with changes in the macroeconomic environment and official
interest rates.
Measures were also taken in relation to the planned regulatory agenda (mObywatel, blocking of PESEL number, 800+
benefit, informing the customer about their right to receive explanation of the repayment capacity assessment).
The Bank ranked second in the cash loan category of the Golden Banker competition.
In 2023, cash loan sales of Santander Bank Polska S.A. were PLN 9.7bn, up 4.8% YoY. Sales generated via remote
channels accounted for 67.1% vs 54.4% in 2022. As at 31 December 2023, the cash loan portfolio of Santander Bank
Polska S.A. totalled PLN 16.6bn, up 10.0% YoY.
Mortgage loans
The mortgage loan offer of Santander Bank Polska S.A. was changed as follows:
The state-
subsidised 2% Safe Mortgage was introduced as part of the First Apartment programme (November
2023).
The terms and conditions of family home loans were modified in accordance with the Act on state aid for saving for
housing purposes.
A mortgage loan based on the new benchmark (1M WIRON) was designed and is scheduled for implementation in
2024.
A green mortgage loan with a lower interest rate was launched for buyers of secondary market property who
submit a loan application together with an energy performance certificate as evidence that the loan qualifies as
green finance (in accordance with the EU taxonomy).
In 2023, the pricing policy was modified in line with the market conditions and the changing demand for mortgage loans.
The offer of loans with a 5-
year fixed rate was improved and updated in accordance with 5Y IRS quotations. The margin
on variable-rate loans was increased.
The first marketing campaign was launched to offer customers a home loan based on the estimated mortgage loan
prelimit. Pilot campaigns addressed to CHF loan borrowers were continued, encouraging them to convert their loans to
PLN on preferential terms and make a settlement.
The Bank continued to simplify and digitalise the processes:
The mortgage loan application process for buyers of primary market properties was simplified.
Post-
sales services for mortgage loan borrowers were centralised and digitalised. They can now remotely sign an
annex to the loan agreement via electronic banking and apply for and receive a statement for the notary for
mortgage registration.
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Product line
for personal customers
Activities of the Retail Banking Division in 2023 (cont.)
Mortgage loans (cont.)
In 2023, mortgage loan sales totalled PLN 7.6bn, up 7.4% YoY. Mortgage loans with a 5-year fixed rate accounted for
83% of the volume of mortgage loans granted in 2023 (52% in 2022).
As at 31 December 2023, the value of the mortgage loan portfolio was PLN 51.6bn and increased by 1.3% YoY, including
an 8.5% YoY rise in the PLN portfolio.
The 2023 volumes were dominated by mortgage loans bundled with other products such as current accounts, Worry-
Free (Spokojna Hipoteka) life insurance, Locum Comfort property insurance and credit cards.
The Bank is ranked third in the mortgage loan market with a share of 12.7% in terms of new loans and fourth with a
share of 10.98% in terms of the value of the portfolio (as at 30 November 2023).
Personal accounts and
bundled products,
including:
The personal account offer of Santander Bank Polska S.A. was ranked third in the 14th edition of the Golden Banker
competition.
A new account offer was introduced on 1 July 2023. Account As I Want It (Konto Jakie Chcę) was renamed Santander
Account (Konto Santander). The Bank modified the conditions of the account maintenance waiver and reduced the fees
for cash withdrawals from ATMs of other banks in Poland and for the ATM package.
New Santander Max Account (Konto Santander Max) was introduced, with a range of benefits for a monthly fee of PLN
15.
The Select Account offer was modified to include 1% cashback on bills paid from that account.
The Bank introduced an additional service package, including Santander On the Go (Santander w Podróży) (free ATM
withdrawals and transfers between Santander Group banks), discounts on the Rabaty platform, and carbon footprint
tracker.
The Price Advisor service was extended, enabling the holders of Santander Account, Select Account, Standard Account,
123 Account and Customised Card to check the conditions they need to meet to pay less.
In line with the KNF’s recommendation, in 2023 the Bank continued to offer personal accounts to Ukrainian refugees on
special terms, i.e. without charging account maintenance fees, card fees and fees for transfers to Ukraine.
The number of PLN personal accounts grew by 3.4% YoY and reached 4.6m as at 31 December 2023. The number of
Santander Accounts (formerly: Accounts As I Want It and Accounts Worth Recommending), which are the main
acquisition product for a wide group of customers, was 3.7m. Together with FX accounts, the personal accounts base
totalled 5.8m (+4.9% YoY).
Payment cards
In 2023, the Bank continued its promotional, sales and relationship-building activities to increase card turnover. It also
extended the card product offer and card features:
A debit card was introduced for children aged 7–12.
Changes were made to the Schedule of Fees and Charges in terms of payment cards, e.g. a conversion fee for Visa
Select Card was reduced to PLN 0, making card payments abroad cheaper.
The card plastic recycling process was underway to support sustainable development.
Technical solutions were implemented to enable customers to use payment cards in mobile wallets before they
receive plastic cards.
The range and functionality of card products was expanded to include new mobile wallets: Xiaomi Pay and Swatch
Pay.
As at 31 December 2023, the personal debit card portfolio comprised 4.3m cards and increased by 2.7% YoY, generating
14.5% higher non-cash turnover YoY.
The credit card portfolio of Santander Bank Polska S.A. included 623k instruments and decreased by 7.0% YoY,
generating 7.2% higher non-cash turnover YoY. The credit card debt was down 1.1% YoY.
Deposit and investment
products, including:
In 2023, the Bank’s priority in terms of managing deposit and investment products amid persistently high interest rates
and high
inflation was to achieve and maintain the leadership position in terms of average cost of deposits, while
growing the savings and investment portfolio and increasing its profitability. This was combined with measures taken
to ensure high satisfaction of savers (NPS).
During the year, the Bank optimised interest rates on PLN term deposits and negotiated deposits, which not only
stabilised
the overall deposit cost but significantly reduced it starting from September. To that end, interest rates on all
on-sale deposits and off-sale renewable deposits were cut, particularly on standard 3-, 6- and 12-month deposits and
deposits on special offer.
The Bank’s investment offer consisted mainly of brokerage services, structured deposits and investment funds, including
funds managed by the Bank’s subsidiary Santander Towarzystwo Funduszy Inwestycyjnych S.A. (Santander TFI S.A.) and
selected Polish and foreign funds.
Customers interested in investment products continued to diversify their portfolios by increasing the share of investment
funds, particularly the funds managed by Santander TFI S.A., which posted record sales.
While the Bank’s share in the retail deposit market decreased in the reporting period, the share of investment funds
managed by Santander TFI S.A. in the investment fund market increased considerably.
As part of investment education initiatives, the Bank organised webinars on the capital market conducted by experts
from Santander TFI S.A. and external companies.
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Product line
for personal customers
Activities of the Retail Banking Division in 2023 (cont.)
Deposits
In 2023, the deposit offer of Santander Bank Polska S.A. was adjusted to market conditions, i.e. stable market rates until
August and steady pricing terms offered by competitors.
Following the interest rate cuts by the NBP in September and October 2023, in Q4 the Bank focused on maintaining the
profitability of the deposit offer by modifying it to account for lower interest rates, while ensuring that the offer remains
satisfactory for savers.
In 2023, the offer of PLN term deposits and PLN savings accounts was modified 12 times.
The most popular products in 2023 were term deposits, including the limited offers of PLN deposits: Mobile Deposit
(Lokata Mobilna), Holiday Deposit (Lokata Wakacyjna), Deposit for You (Lokata dla Ciebie), Winter Deposit (Lokata
Zimowa) as well as non-limited 3- and 6-month deposits and negotiated deposits for Wealth Management and Select
customers.
To meet customers’ expectations, the Bank offered limited special deals for both depositors of new funds and existing
customers.
The Bank actively promoted the limited offers of deposits with attractive interest rates for existing customers. The
deposit offer was extended to include: limited Mobile Deposit with an interest rate of 7% (introduced in April),
Holiday Deposit paying 6%
(introduced in July), Deposit for You with an interest rate of 5.50% (introduced in
September), as well as the deposit supporting the new mobile application and Winter Deposit with an interest rate
of 5%.
In addition, in January 2023 the Bank launched Investor Deposit (Lokata dla Inwestora) on special terms for
customers investing their money in investment funds, with an initial interest rate of 8% reduced afterwards to 7%
and 6.5%.
The Bank also actively promoted PLN savings accounts through a special offer on new funds in the Max Savings
Account (Konto Max Oszczędnościowe), paying an 8% interest rate on deposits up to PLN 100k (March–June) and
a special offer of Select Savings Account (Konto oszczędnościowe Select) called “We reward active customers 8”
(“Doceniamy aktywnych 8”) offering a 5% interest rate to Select customers who make a stated number of
transactions.
More than 400k customers availed of special deals in 2023.
The number of users of My Goals (Moje Cele), an automatic savings solution, reached nearly 500k. In July 2023, the
access to My Goals was extended to include minors aged 13 and older.
The share of term deposits and personal accounts increased at the expense of savings accounts.
As at 31 December 2023, total deposits from retail customers increased by 4.7% YoY to PLN 107.2bn. Term deposit
balances grew by 17.4% YoY to PLN 35.1bn, while current account balances (including savings accounts) decreased by
0.5% YoY to PLN 72.0bn.
Investment funds
Due to strong performance of investment funds managed by Santander TFI S.A. and financial market conditions, the
investment solutions offered by the company continued to attract customers’ interest.
The most popular products were short-term debt sub-funds, whose projected rates of return are regularly published.
In 2023, net sales of investment funds managed by Santander TFI S.A. hit an all-time high of PLN 4.3bn.
The company was the market leader in terms of the balance of sales and redemptions in the 12-month period ended
31 December 2023, increasing its share in the retail market by 159 b.p. to 10.90%.
As at 31 December 2023, the total net assets of investment funds managed by Santander TFI S.A. were PLN 18.9bn, up
54.2% YoY.
In 2023, Santander TFI S.A. took further measures to build its market position in terms of Employee Capital Plans (ECP)
based on organic growth and a campaign addressed to employers supporting the first automatic enrollment. As at the
end of December 2023, the company managed ECP assets of PLN 356m from 89k Santander PPK SFIO unitholders.
Santander Brokerage
Poland
One of the competitive edges of Santander Brokerage Poland is the variety of products and services it offers, including a
broad range of foreign market instruments and ancillary services.
In 2023, the offer of structured products was expanded to include green bonds. Net issue proceeds are invested in
financing or refinancing of green projects that meet the criteria set out in the Santander Group Green, Social and
Sustainability Funding Global Framework.
In line with customers’ expectations, Santander Brokerage Poland extended the offer of Exchange Traded Funds (ETF),
which are an alternative to standard equity investments, to include ETFs for assets such as electric vehicles and driving
technology, American treasury bonds with tenors of 0–1 year, 1–3 years and 20+ years, battery metals and broadly
understood ESG assets.
In January 2023, two-
factor authentication was implemented in the brokerage platform. Secure biometric login
solutions have been available to users of the mobile application for some time now.
The predominant trend in the business performance of Santander Brokerage Poland in 2023 is the increased share of
structured products in total income. Particularly important in this context are products tailored to the largest possible
customer group as we
ll as external developments. Due to the overall decline in the Polish capital market (WSE), the
share of other business lines is increasing.
The Institutional Brokers Team of Santander Brokerage Poland came top in the annual ranking published by Parkiet. In
the same ranking, Santander Brokerage Poland analysts received six individual awards in their sectors: banking and
finance, sale and distribution, telecommunications and media, industry, construction and development. In addition, two
representatives of Santander Brokerage Poland were among top 10 analysts in Poland in the overall ranking.
In 2023, Santander Brokerage Poland ranked second among Polish brokers in terms of share in the WSE market
(including block trades), which totalled 5.1%.
The share in the retail investor segment was 14% (13.6% in 2022).
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Product line
for personal customers
Activities of the Retail Banking Division in 2023 (cont.)
Bancassurance
The range of insurance products includes insurance related to credit facilities for retail and business customers as well
as non-
related products such as Life and Health (Życie i zdrowie), Locum Comfort, Partner in Business (Partner w
Biznesie), Partner in Business Plus (Partner w Biznesie Plus) and motor insurance.
In the reporting period, changes were introduced to the customer need analysis and sales processes were developed to
ensure that customers make informed decisions and choose products that suit their needs.
In response to customers’ expectations, the scope of the life and health insurance was extended to include an additional
child insurance package and an additional risk in the health insurance package (benign tumor operation). A motor
insurance renewal option was introduced in Santander internet and Santander mobile.
A new process was implemented in Santander internet and Santander mobile to sell the Worry-Free Loan (Spokojny
Kredyt) insurance together with cash and consolidated loans. The process is aligned with the new mobile application
and the associated risks are minimised.
A life insurance linked to a mortgage loan was offered to citizens of non-EEA countries irrespective of their residence
status in Poland.
In 2023, insurance premiums decreased by 17.7% YoY as a combined effect of an increase of 22.3% YoY in premiums on
non-related insurance and a decline of 24.4% YoY in premiums on related insurance (mainly insurance linked to cash
loans), resulting from a rise in the maximum non-interest cost of loans.
Private Banking
The investment offer for Private Banking (PB) customers is continuously extended and includes a wide range of products:
investment funds (Santander TFI and open-
ended investment funds offered by entities outside Santander Group); the
Global Value Proposition service (enabling PB customers to use global PB facilities available in various Santander Group
countries); custom structured deposits; currency conversion with an FX dealer; and Santander Brokerage Poland
products and services. As part of cooperation with Santander Brokerage Poland, PB customers can avail of products that
reflect current market conditions.
In terms of credit services, PB customers are offered a dedicated path and support from credit experts.
Customers were reallocated between segments and portfolios. Like every year, the portfolio of Private Banking (PB)
customers was expanded to include customers from other segments with assets above PLN 1m. The monthly transfer
of customers to the PB segment was streamlined. New PB customers are regularly onboarded.
For another year, Santander Brokerage Poland was recognised in Euromoney Private Banking Awards, receiving the title
of Best International Private Banking 2023 in Poland.
Small and Medium Enterprises (SMEs)
Product line
for SMEs
Activities of the Retail Banking Division in 2023
Business accounts and
bundled products
In 2023, the Bank offered a range of promotions for SME customers:
Another edition of the special offer of the Business Account Worth
Recommending (Konto Firmowe Godne
Polecenia) available online (including bonuses for specific banking operations and use of selected products and a
waiver of selected fees and charges for an indefinite period).
Special offers related to a business account:
promotion with Allegro (until the end of July), as part of which customers were offered an Allegro gift card;
Business Account Worth Recommending (Konto Firmowe Godne Polecenia) with a bonus;
“Bonus with eAccounting” promotion for customers using eAccounting services;
continuation of the promotion rewarding selected business customers making transfers to the Social
Insurance Institution (ZUS) or the Tax Office.
Promotion of POS terminals and softPOS (application enabling customers to use their tablet or phone as a terminal)
by waiving a subscription fee.
Promotion of additional services: eLeasing (leaseback up to PLN 20k), eHealth/ eZdrowie (private healthcare
packages), eAccounting/ eKsięgowość, eAgreements/ eUmowy, eDebtCollection/ eWindykacja.
Business customers were provided access to BLIK service in the mobile application.
Interest rates on the Lokata24 Biznes Impet and Lokata Biznes Impet term deposits were increased.
A new functionality was implemented: virtual debit cards.
A campaign was launched to promote a business account with additional services and a POS terminal, and the “Green
idea” campaign was run to show how the Bank helps customers use green finance.
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Product line
for SMEs
Activities of the Retail Banking Division in 2023 (cont.)
Business accounts and
bundled products (cont.)
As part of the Entrepreneurs Week held in June 2023, each day the Bank offered a new special deal, e.g. term deposits
with a higher fixed annual rate, promotional offer of POS terminals (no subscription fee for up to 12 months),
CyberRescue package, eAccounting and a discount at the Kantor Santander currency exchange platform.
Educational and development initiatives were put in place, including:
Webinars about taxation methods (organised in partnership with inFakt) and changes in business.
#afFIRMation – a series of training sessions organised in partnership with the Polish Entrepreneurship Foundation,
including a webinar about motivation.
Loans
In 2023, Santander Bank Polska S.A. expanded the offer of liquidity loans, extended the tenor of the Business Express
(Biznes Ekspres) loan to 96 months and introduced a fixed-rate Business Express loan in the remote channels.
A range of credit promotions were offered to increase customers’ satisfaction with financing solutions:
Special offer of a loan with 0% arrangement fee available in the remote channels (internet, mobile and phone
banking) and branches.
“Loan and leasing with a medical package”: free private healthcare at LUX MED over 12 months for eligible
borrowers and lessees.
“Green 0%”: a waiver of an arrangement fee on loans or leasing used to finance photovoltaic panels, heat pumps,
energy storage facilities and charging stations.
Special pricing for customers intending to switch their loans from other banks.
“Leasing Worth
Recommending”: 0% arrangement fee and waiver of selected fees for customers who meet the
criteria of the special offer.
Measures were taken to optimise the lending process and reduce the time to yes.
A prelimit offer was prepared for existing customers of the Bank and Santander Leasing S.A.
Leasing
Santander Leasing S.A. simplified the leasing agreement and the General Terms and Conditions of Leasing (March 2023)
and documents related to a fuel card (May 2023) in accordance with plain language standards. The purpose of the
changes was to ensure that the documents are clear and easy to navigate.
The company launched zielonepanele.pl, a website where customers can learn about the benefits of investments in
photovoltaic solutions, check information about the cost of installation, indicative financing terms and offers of selected
suppliers, as well as submit a request for proposal. The purpose of the initiative is to reach a new customer group and
present advantages of investments in renewable energy.
In 2023, the company introduced a simplified procedure for SMEs with respect to the financing of renewable energy
projects. Customers can apply for financing of photovoltaic panels, heat pumps, energy storage facilities and chargers
for electric cars with specific parameters. The maximum financing period is 10 years and a down payment is 10%.
A promotional margin was introduced (until 31 March 2023) on a consumer loan for sustainable assets, including
photovoltaic panels, heat pumps and energy storage facilities and batteries.
On 2 March 2023, Santander Leasing S.A. signed an operational agreement with Bank Gospodarstwa Krajowego to grant
liquidity loans to companies from the Łódzkie Province using funds available under the Smart Growth Operational
Programme 2014–2020. Zero-interest rate loans were aimed to support micro, small and medium companies affected
by changes in economic conditions, Covid-19 pandemic or Russian invasion of Ukraine.The total value of loan
agreements signed with customers is PLN 50m.
To increase the competitiveness of the product range, the company offered:
A simplified procedure for financing heavy-duty vehicles of up to PLN 1m for SME customers (excluding customers
providing passenger transport services).
Loans with a fixed principal instalment for customers from the agri segment.
A simplified procedure for corporate customers for financing assets of up to PLN 100k (which previously could only
be financed as part of a standard procedure).
New vendor finance schemes (including subsidised loans) with four manufacturers of farm equipment.
A solution under which customers who lease a new zero-emission vehicle with the “My electric car” subsidy do not
have to pay the entire deposit but may settle the subsidy with the first leasing payment.
The LeasyEasy offer: a loan up to PLN 20k for sole proprietors to finance purchases in selected online stores. The
customer can sign a loan agreement using an smsCode within ten minutes of selecting a product. The offer is now
available in the first online store – CoffeeDesk. This innovative procedure does not involve advisors, analysts or
controllers and is available 24/7.
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Product line
for SMEs
Activities of the Retail Banking Division in 2023 (cont.)
Leasing (cont.)
Santander F24 S.A. extended the scope of assets that can be financed with a consumer loan (to include pick-up trucks
and camper vans) and introduced eco and agri financing in partnership with suppliers.
On 6 June 2023, Santander Leasing S.A. and Santander Bank Polska Foundation (together with GreenWay Poland and
the Polish Alternative Fuels Association) launched the nationwide grant programme for local governments called:
“Together for Eco-Change”. The pr
ogramme, which is the first one of this kind in the leasing industry, involves the
financing of a network of at least 16 electric car charging stations and their maintenance for two years. The programme
budget is PLN 1m.
The promotional offer of a consumer loan for photovoltaic panels, heat pumps, energy storage facilities and batteries
was extended until the end of the year.
In response to measures taken by competitors, the maximum residual value was increased up to 60% for new and
second-hand vehicles (up to four years old) from authorised dealers.
In 2023, Santander Leasing S.A. financed assets of PLN 8.0bn (+16.8% YoY). The growth was driven mainly by sales in
the vehicles segment (+32.2% YoY).
2.2. Business and Corporate Banking Division
The Business and Corporate Banking Division provides services to businesses and corporations with turnover of PLN 8m–PLN 1.2bn, local authorities and
the public sector. The Bank’s offer includes all types of banking products and services, including payment transactions, loans, deposits, cash management,
leasing facilities, factoring, letters of credit and guarantees.
Main directions
The Business and Corporate Banking Division pursues the strategic goal of Santander Bank Polska S.A. which is to become the best business bank and to
be among the top three banks in terms of the market share. It strives to ensure best-in-class customer experience (confirmed by outstanding NPS survey
results) by investing in new CRM platforms and processes. Santander Bank Polska S.A. wants to be the bank of choice and the employer of choice.
This strategic goal is measured using a range of indicators which cover all stakeholder groups. The market position is assessed on the basis of NPS as
well as employee engagement and motivation.
The priorities of the Business and Corporate Banking Division for 2023 were set in accordance with its strategy, observations and lessons learned from
the last year. They were as follows:
ensuring unparalleled experience for customers and employees and strengthening the Bank’s market position;
simplifying and digitalising key products and services;
acquiring new customers and growing business, mainly in digital channels;
delivering projects in cooperation with Santander Group units.
The Business and Corporate Banking Division continues to pursue the growth strategy based on the strategic priorities. The relationship-building and
acquisition activities contributed to the continued growth in the majority of business lines along with a satisfactory quality of the credit portfolio. Key
business results achieved in 2023 in individual areas are presented below.
Business highlights of 2023
Increase in the number of mobile customers +12% YoY
Increase in the number of customer transactions
+5% YoY
Increase in FX income from eFX platform
+10% YoY
Increase in income from transactional banking
+67% YoY
Growth of leasing volumes
+8% YoY
Growth of deposit volumes
+6% YoY
Management Board Report on Santander Bank Polska Group Performance in 2023
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Direction Activities of the Business and Corporate Banking Division in 2023
Business trends in
the main product
lines
Business growth driven by increased customer activity and diversification of the business model.
Strong business performance despite the challenging macroeconomic environment, with higher income from transactional
banking (+66.7% YoY), loans (+11.9% YoY), leasing (+17.2% YoY) and trade finance (+4.2% YoY).
Sound sales performance, notably in terms of leasing (+13.8% YoY).
5.1% YoY increase in the volume of transactions made by customers.
High credit quality of the corporate portfolio, with a low and stable cost of risk.
Continued transformation focused on people and gradual digitalisation in the area of electronic banking (iBiznes24),
lending process (CLP platform) and cloud-based CRM (Salesforce).
Business
transformation/
digitalisation
People-centric transformation
Continuation of innovative transformation programmes aimed to improve the work environment, develop skills and share
leadership experiences.
Business transformation/ digitalisation
Continuation of digitalisation and development projects aimed to ensure best-in-class services.
Development of a new version of the iBiznes24 electronic banking platform and iBiznes24 mobile application. Growth driven
by improvements increasing innovation and changes introduced on the basis of strategy and user reviews (customer feedback
loop). Key changes:
Przelew24 funds transfer service for electronic banking users
view-only access to customer’s desktop for iBiznes24 advisors
future-dated transactions in the e-FX module
simplified execution of service parametrisation requests
multi-tasking option (work in multiple modules)
new and more user-friendly approval process for transfers and batches.
Extending cooperation with partners of the supplier of the financial and accounting software for iBiznes24 Connect.
Establishing relationship with SIMPLE – supplier of the SIMPLE.ERP software to be integrated with iBiznes24 Connect.
Introducing an option for customers to buy a qualified signature via electronic banking of Santander Bank Polska S.A.,
whereby the process of executing documents with customers is easier, faster and entails less workload. Agreements are
made remotely and can be easily archived in electronic form.
Increased availability of electronic signature: launch of SignHUB –
a new platform for signing documents with qualified
electronic signature in the Santander Electronic Signature application. The solution enables automated exchange, encryption
and password
protection of electronic documents as well as automated authentication and approval of electronic signature
and status assignment for document execution stages.
Verification of customer’s identity based on an electronic ID (mDowód).
Automated account closing.
Improvement of phone banking experience by integrating phone systems with CRM Salesforce, which ensures faster and
more effective services for customers. Implementation of specialist processes to speed up execution of customers’
instructions regarding bank certificates, opinions for auditors and sealed cash deposits.
Development of the CLP (Corporate Lending Platform) – introduction of changes resulting in an increase in the number of
credit customers handled at a time, automation of data processing and further reduction of turnaround times:
a functionality enabling the sanction of a working capital loan and its end-to-end service in the CLP, which makes the
credit decision-making process much simpler and faster;
an option to renew the de minimis guarantee;
services for customers availing of lease loans;
new screens in the system, reducing operational risk;
a number of other functionalities which increase user-friendliness of the CLP;
simplification of the credit process and conditions of the LC limit sanction, including as part of the MultiLine.
Products
Introduction of changes arising from the amended Development Act and execution of agreements under the new rules.
Modification of the credit process: implementation of a credit decision-maker model in relation to customers with turnover
of up to PLN 60m, resulting in decentralisation and speed-up of the credit decision-making process.
Introduction of CAP options with a deferred premium in accordance with customers’ expectations, enabling flexible allocation
of pre-hedging costs. A non-exercised CAP option can be transferred to another project, a feature particularly important for
property developers.
Increase in spending and authorisation limits on corporate cards.
Expansion of the product range to include instant EUR incoming payments which are processed within 10 seconds. That
solution is available to all customers with no additional requirements. The fee is the same as in the case of cross-border
payments and takes into account current concessions. Transactions are executed in line with the SEPA Instant Credit Transfer,
a pan-European instant payment scheme.
Implementation of a new simplified recourse factoring process for limits up to PLN 2m based on a fast track decision-making
procedure and customer’s declaration (with no source documents needed).
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Direction Activities of the Business and Corporate Banking Division in 2023 (cont.)
Products (cont.)
Introduction of changes to the Schedule of Fees and Charges and product terms and conditions, including: amendment,
refinement and simplification of provisions for users of trade finance products and implementation of regulatory obligations
arising from VAT interpretations.
Public sector
Steady increase in the number of local authorities serviced by the Bank, from provinces to cities and towns to municipalities.
Growth of structured finance for local authorities combined with optimisation of RWA levels.
Active support for new solutions related to energy transformation and zero-emission public transport.
International
banking
Leveraging the Group’s global footprint and cooperation with foreign banks and bilateral partners to support the expansion
of Polish exporters and companies with foreign capital doing business in Poland through the organisation of B2B meetings
and other online and onsite events to:
provide an opportunity to share knowledge and experience and promote networking among business partners;
reach out to foreign investors planning to enter the Polish market and representatives of Polish companies with foreign
capital.
In 2023, Santander Bank Polska S.A. was the sponsor of the following events:
Golden Sponsor of the Orange Ball 2023 – an international event for Polish and Dutch companies organised in Warsaw
in cooperation with the Netherlands-Polish Chamber of Commerce; and the sponsor and partner of the series of online
and onsite meetings as part of “Knowledge Circle: Transport & Logistic”;
sponsor of the meetings held in Poznań, Wrocław and Gdańsk as part of the “Board & Directors Club” initiative organised
by the Polish–German Chamber of Commerce for owners and senior managers of Polish and German companies;
the key sponsor of the Energy Industry Mixer 2023 – international B2B meetings for local authorities and businesses
regarding energy efficiency, recycling and waste treatment, organised in cooperation with Italian companies operating
in Poland. The participants included Confindustria Polonia, ITA Italian Trade Agency, Embassy of Italy and Italian
companies doing or planning to do business in Poland.
The following events were organised:
four events organised in partnership with the Scandinavian-
Polish Chamber of Commerce (SPCC): Economic Outlook,
CEO Breakfast Meeting in Szczecin, Networking Meeting in Poznań and Christmas Party of SPCC members in Sopot.
“Tax Train” event organised in the Łódź Special Economic Zone in partnership with the British-Polish Chamber of
Commerce and Deloitte, focusing on tax reliefs related to new investments and Poland’s economic outlook.
Participation in the Money20/20 event and in more than 30 meetings with non-bank financial institutions.
Preparation and publication (including online) of “Chile, Columbia, Mexico & Peru – Guide for Polish entrepreneurs”: first such
compendium about the four countries of the Pacific Alliance available in Polish. The publication was prepared in cooperation
with the Polish Latin American Business Council, Polish-Spanish Chamber of Commerce, embassies of Chile, Columbia,
Mexico and Peru, and PwC with expert and financial support from Santander Bank Polska S.A. It was promoted during the
seminars in Warsaw, Katowice, Gdańsk and Bydgoszcz, attended by representatives of Polish companies, embassies of the
Pacific Alliance countries and employees of Santander Bank Polska S.A.
Awards and
recognitions
Santander Bank Polska S.A. was awarded:
the title of Cooperation Quality Leader by the BGK at the gala celebrating the 10th anniversary of de minimis guarantees,
in recognition of satisfactory cooperation as well as high quality of the guarantee portfolio and documents;
the first prize in the “Financing Provider of the Year, CEE” category of the Eurobuild Awards competition for the third
year in a row (one of the most important and prestigious awards in the commercial properties sector);
International Factoring FCI Award in the “Best deal of the year” category;
a certificate by the Wrocław University’s Centre for Plain Polish for a framework agreement written in a plain and user-
friendly language (the first agreement of this kind available in the corporate market).
Area Activities of Santander Factoring Sp. z o.o. in 2023
Factoring
The credit portfolio of Santander Factoring Sp. z o.o. increased by 11.9% YoY to PLN 7.8bn as at 31 December 2023.
The receivables purchased by the company went up by 11.7% YoY in 2023 to PLN 44.8bn.
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2.3. Corporate and Investment Banking Division
The Corporate and Investment Banking (CIB) Division provides an end-to-end support to the largest corporate customers of Santander Bank Polska S.A.
As at 31 December 2023, the active CIB customer base included around 250 of the largest companies and groups in Poland (allocated to that segment
based on the turnover) representing all economic sectors.
Leveraging the global footprint of Santander Group, the CIB Division renders services to corporations within international structures of Santander
Corporate and Investment Banking and cooperates with several Santander Group units.
Main directions
The ambition of Santander Bank Polska S.A. is to become a bank of choice for the largest corporate customers. To that end, the CIB Division puts customers
at the heart of its business, trying to suit their needs and enhance their positive experience, while focusing on service quality, market position and staff
development.
Key achievements in 2023
First position in the Bloomberg League Table in terms of the value and number of transactions in the Polish capital market.
Third position among bond issue arrangers in Poland in the Bloomberg League Table.
Third place in the Mergermarket ranking in terms of the value of mergers and acquisitions in the Polish market.
First position of the brokers team and third position of the equity research team in the ranking published by Parkiet.
First position of two stock market analysts in the ranking by sectors and second position of a Bank employee in the brokers ranking.
First place in the Treasury Securities Dealers ranking published by the Ministry of Finance in three quarters of 2023.
Transformation of corporate and investment banking
Business transformation
In accordance with its strategy, the CIB Division focused on process effectiveness, automation, digitalisation, new technologies and innovations,
ecosystems and 24/7 access.
The functionality of the GTS service available on One Trade Portal was further extended to include the following innovative features:
• One Trade Multinationals – a range of options that help customers manage their international operations: real-time balance check,
consolidation of balances in a single currency, information about balance of accounts in other Santander banks available in standard formats.
• International Instant Payment – instant payments in EUR to Santander Bank in Spain available to business and corporate customers. The
payment is made within just a few minutes of making a payment order.
Santander Bank Polska S.A. was the first bank in Poland to implement EBICS 3.0 (Electronic Banking Internet Communication Standard). EBICS is a
secure and uniform standard of communication between the bank and the corporate customer. The benefits of the new version include (but are not
limited to): 1) a single, harmonised standard (elimination of local differences); 2) improved security; 3) distributed electronic signature.
Development of the Global Connect market – Santander Brokerage Poland participated in the IPO of several companies.
Service quality
Continuous improvement of service quality through customisation, digitalisation and diversification of the
product range.
Market position
Staff dev
elopment
The bank steadily strengthens its market position through a range of activities, ensuring top ranking position
s
of its strategic products and services.
The bank’s employees pursue their professional careers in accordance with the Group’s values, taking
advantage of experience-sharing opportunities in an international work environment.
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In 2023, 324 recommendations were issued with regard to CEE listed companies. Institutional investors could take part in a range of conferences. As part
of the Entrepreneurs Week, a webinar with the Bank’s economists was organised (“Where is Poland’s economy headed?”).
Representatives of the CIB Division attended renowned conference such as: CEE 2023 Treasury Forum or Masters&Robots Conference organised by Digital
University.
Green transactions
The Corporate and Investment Banking Division actively contributes to the transformation of the Polish energy sector by participating in financing the
development of renewable energy sources and advising on green transactions in the capital market:
Participation in domestic corporate bond issues, in particular co-arrangement of issues of sustainability-linked bonds for a customer from the TMT
sector totalling PLN 2,670m and PLN 820m.
Advisory services and financing for a number of wind and solar farm sales transactions.
Active participation in Poland’s largest project finance transaction (construction of the first offshore wind farm).
Co-financing of photovoltaic and wind farm portfolios with a total capacity above 723 MW, including co-financing of a wind farm portfolio of approx. 150
MW in cooperation with the Global Transactional Banking Department, Banco Santander S.A. and an export credit agency.
Performance of selected areas
In 2023, units of the Corporate and Investment Banking Division focused on the following initiatives:
Unit Key activities in 2023
Credit Markets
Department
Project finance and syndicated lending:
Participation in several project finance transactions related to the development of renewable energy infrastructure
(offshore wind farm and a few onshore wind and solar farm projects).
A leading role (including as the ESG Coordinator) in syndicated lending for a company from the telecommunications
sector.
Participation in a syndicated loan for a group from the energy sector.
Financing of a project in the residential and office lettings sector.
Leading role in the financing of a telecommunications infrastructure development project.
Leading role in the key debt refinancing transactions in the retail and manufacturing sectors.
Participation in on-balance sheet and synthetic securitisations.
Active communication with key customers in terms of project finance (particularly in connection with renewable energy),
securitisation structuring and finance, and debt, rating and ESG advisory services.
Notable performance in the asset turnover and underwriting area, particularly in the telecommunications, commercial
properties and industrial sectors. Stable activity in the local bank debt market despite significant uncertainty caused by
the geopolitical situation. Growth in cost of PLN finance for foreign banks in H1 followed by a decrease in H2, resulting in
increased interest in domestic debt transactions. The main debt transactions concerned the following sectors: renewable
energy, power generation, te
lecommunications, commercial properties (logistics and office segments) and the private
rented sector. The most popular debt transaction among foreign banks was the first offshore wind farm project.
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Unit Key activities in 2023 (cont.)
Credit Markets
Department (cont.)
Completion of bond issues, including:
Participation in the issue of EUR 750m worth of MREL-eligible eurobonds for a customer from the financial sector,
two issues (including the first one) of USD 2.75bn worth of bonds for a company from the public sector, and one issue
of EUR 1,250m worth of treasury bonds in the euro market.
Cooperation with Santander Group in international eurobond issues, including EUR 500m worth of eurobonds for a
company from the multi-energy sector and EUR 375m worth of eurobonds for a company from the retail sector.
Participation in domestic corporate bond issues, in particular co-arrangement of issues of sustainability-linked bonds
for a customer from the TMT sector totalling PLN 2,670m and PLN 820m.
Participation in issues in the Polish market, in particular two issue of the Bank’s MREL-eligible bonds: senior-non preferred
bonds of PLN
1.9bn in Q1 2023 (the first transaction of this kind in Poland) and senior preferred bonds in Q4 2023.
Particularly the latter issue attracted a lot of interest from investors, as a result of which the nominal value of the
transaction was record high at PLN 3.1bn (the largest issue in PLN by a private entity in the history of the Polish capital
market). The Bank also participated in the issues of PLN 342m for customers from the property sector as well as the issues
for customers from the financial sector totalling PLN 1,580m.
Capital Markets
Department
Acting as the joint bookrunner in relation to the sale of existing shares of a company from the retail sector, the first
transaction of this kind on the WSE in 2023 and one of the largest deals in recent years.
Transactional advisory and intermediary services for an acquirer in the tender offer for shares of a leading entity from the
chemical sector.
Intermediary services in relation to share buyback for an interior fittings manufacturer.
Acting as the
global joint coordinator and joint bookrunner in relation to the issue of shares of a company from the retail
sector.
Transactional advisory and intermediary services for an acquirer in the tender offer for shares of a company from the
electrical goods distribution sector.
Acting as the sole global coordinator and joint bookrunner as part of an accelerated book building for existing shares of a
company from the financial sector.
Transactional advisory in the sale of a leading aluminum processing company listed on the WSE.
Advisory services for the renewable energy platform operated in Poland and Baltic states in relation to the search for
another minority shareholder for the purpose of a capital increase.
Acting as the joint global coordinator and joint bookrunner in relation to the sale of shares of a company from the new
technologies sector.
Intermediation in the buyback of shares by a company from the IT sector.
Advisory services related to the sale of wind farms in the Wielkopolskie province as well as the shares of a hygienic paper
manufacturing company, regional internet service provider and food production and distribution company.
Acting as the sole global coordinator in the issue of shares with pre-emptive rights by a company from the renewable
energy sector.
Acting as the joint global coordinator in relation to the IPO of a leading housing developer.
Global Transactional
Banking Department
Business trends in trade finance:
The demand for working capital finance was slightly higher compared to the previous year. The limit utilisation
declined, as a clear effect of high PLN reference rates. Growing number of customers were interested in mitigating
counterparty risk on a standalone and portfolio basis.
Documentary letters of credit and collections were increasingly used to mitigate counterparty risk and the risk of the
counterparty’s country. The cooperation with foreign banks was expanded.
High demand for stable long-
term sources of financing translated into active use of export finance products as part
of existing transactions and acquisition of new business based on these structures.
Business trends in transactional banking:
Net interest income was the key contributor to the income generated by the Cash Management Office in 2023.
Decisions taken by the Office were determined by fluctuations in the interest rate market and changes in customers’
investment and spending policies. The balance of deposits grew at a record rate during the year but returned to the
average levels at the end of 2023.
Net income on transactional banking and net fee and commission income were lower YoY in nominal terms. Fees
related to balance management policy and negative interest rates were significant items in 2022. If they are
excluded, net income on transactional banking shows an upward trend in 2023. The Office undertook a number of
initiatives to extend the scope of solutions offered to customers. Many new products and improvements were
introduced, increasing the volume of customer instructions executed by the Bank.
2023 was a record year in terms of income generated from transactional banking. Given the variety of initiatives and
changes introduced, the prospects for the next months are positive. As further interest rate cuts are expected, new
product solutions are b
eing designed to keep the upward trend in the coming years despite the relatively lower net
interest income.
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Unit Key activities in 2023 (cont.)
Global Transactional
Banking Department
(cont.)
Business trends in other areas:
Despite a decline in interest rates and – consequently – borrowing costs, the utilisation of overdrafts in H2 was
significantly lower compared to H1 (down 14%).
Crisis guarantee programme: in H2 2023, new exposures did not need to be secured by crisis guarantees.
New crisis guarantees can only be issued until the end of 2023. After the expiry of the programme, existing guarantees
can be extended for the maximum tenors.
3. Business development of Santander Consumer Bank Group
Strategic priorities
The key goal of the strategy of Santander Consumer Bank S.A. (SCB S.A.) for 2023–2025 is to strengthen the business position and image of the Bank as
an innovative, secure and customer-friendly financial institution with a strong capital base, a unified structure and corporate culture harmonised across
the global group, as well as strong position in the consumer finance market, both in traditional and remote channels.
In 2023, the Bank delivered this goal through the following strategic priorities:
Priority Objective Actions
Leader of
consumer and car
finance (B2B2C)
To ensure effective cooperation with the Bank’s
partners by developing and implementing solutions
that provide best-in-
class financing options for
customers buying products and services from the
Bank’s partners, with a particular use of remote sales
channels.
Developing processes and financial products that meet the
requirements of the consumer and car markets.
Building partnerships with companies from the consumer
and car sales sectors.
Leveraging the potential of products offered by subsidiaries
to provide car finance.
Innovative
customer-centric
bank (B2C)
To strengthen relationships with customers and
increase their satisfaction by leveraging existing
channels, in particular remote ones.
To further develop and ensure innovative solutions to
build long-term relationships with customers in terms
of savings products.
Increasing the use of self-service and remote channels in
online sales.
Increasing the use of the mobile application.
Rising the rate of conversion of customer contacts to credit
sales across all channels.
Responding to customers’ needs at all sales and post-sales
stages.
Maximised
efficiency
To increase competitive advantage in terms of
operational efficiency.
Using effectively the customer data from external sources.
Enhancing the effectiveness of sales, credit and operational
models.
Improving the quality and effectiveness of processes.
Improving existing and implementing new technological
solutions.
Using resources in an effective and agile way.
Launching new products.
Developing sales tools.
Establishing and strengthening relationships with business
partners.
Personal bank
To continue to create engaging work environment by
attracting, retaining and developing talents (especially
digital and agile competencies), reinforcing corporate
culture based on the TEAMS behaviours, developing an
agile organisation and promoting sustainable
development.
Building the employer brand.
Creating a development offer that suits employees’ needs.
Reinforcing the culture of innovation and agility, and
increasing its maturity.
Promoting and
supporting corporate social responsibility
initiatives undertaken by employees.
Promoting responsible business conduct (ESG).
Improving technological and data management capabilities
of the Bank.
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Focus areas in 2023:
In the reporting period, Santander Consumer Bank Group focused on:
Maintaining the leadership position in the instalment loan market based on a stable share in traditional sales, development of
relationships with large retailers, further growth of online sales, identification of new sales growth opportunities and maintenance
of profitability of cooperation with trade partners.
Further acquisition of customers based on consumer finance products and credit cards and maximisation of sales opportunities
through cross-selling and up-selling.
Maximising the effectiveness of customer contacts and optimising the cash loan offer. Growing cash loan sales in remote channels,
notably in the mobile application.
Focusing on the SME segment due to high interest rate pressure in the automotive market. Use and active development of the base
of partners in product distribution.
Pursuit of the deposit growth strategy, increasing the share of deposits in asset funding.
Key business achievements in 2023
SCB Group reported very strong YoY performance in terms of new and used car finance, with growing profitability of sales. Record double-digit YoY
growth in sales translated into an increase in the share of SCB Group in the car finance market to more than 10%.
In terms of cash loans, SCB Group posted all-time high cashout results during the last months of the year. Double-digit YoY growth was also reported
in late 2023, both in terms of cashout and new sales. The remote channel accounts for more than 40% of cash loans sales.
In terms of instalment loans, SCB Group focuses on optimising the profitability of new sales.
The Bank continues the strategic projects related to cash loans and deposits to better respond to changing consumer behaviours, increased
competitiveness and high cost of funding.
Dynamic development of remote channels and their growing share in the sale of credit facilities: 35% in terms of cash loan sales (29% in 2022)
60.3% in terms of instalment loan sales (51.3% in 2022) 19.8% in terms of credit cards (12.8% in 2022) 11.3% in terms of car finance (10.0% in
2022).
Development of selected business areas
Area Activities of Santander Consumer Bank Group in selected areas in 2023
Lending
As at
31 December 2023, net loans and advances granted by SCB Group amounted to PLN 17.2bn and increased by 9.8%
YoY on account of higher supply of cars subject to lease and higher demand for stock finance, factoring and cash loans.
Strong performance in terms of new and used car finance along with rising profitability translated into a higher share in
the car finance market.
During the last months of 2023, SCB Group reported record high YoY cash loan sales. The share of the remote channel in
sales was steadily increasing.
In terms of instalment loans, SCB S.A. focused on optimising new sales.
A banking services package was offered to customers taking out a specific purpose loan, with a range of services available
during the term of the loan agreement at no additional cost.
In July 2023, an instalment loan subsidised by the European Investment Bank was introduced for customers purchasing
renewable energy solutions.
SCB S.A. increased the maximum available cash loan amount and enabled customers to apply for a credit limit increase
via internet banking.
It also simplified the cash loan sanction process in the mobile application, as a result of which the share of this sales
channel grew considerably.
The Bank further developed the Full Service Leasing, a financial product offering additional benefits such as car service
by approved repairers (Mazda) and full damage and theft insurance.
Deposits
Deposits from customers, mainly term deposits from retail and business customers, are the Bank’s main source of
funding. The offer for retail customers also includes savings accounts.
In 2023, the Bank focused on increasing the share of deposits as the source of funding, while maintaining the profitability
of the deposit base. Measures were taken to actively sell new deposits, encourage the renewal of existing deposits and
promote the savings account.
Stable interest rates (prevailing for the majority of the year) helped to effectively increase the deposit base. In anticipation
of interest rate cuts, the Group took measures starting from Q3 2023 to modify deposit pricing terms to the expected
changes in market rates. Above all, the Bank reduced interest rates on deposits with longer tenors.
As at 31 December 2023, deposits from customers of Santander Consumer Bank Group totalled PLN 13.7bn and increased
by 32.3% YoY owing to the acquisition of retail and corporate customers.
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Bond issue
Santander Consumer Multirent Sp. z o.o. issued another tranche of 2-year variable-rate bonds of PLN 50m. The proceeds
will be used for general corporate purposes.
Insurance
The Bank’s insurance offer was extended to include three new products not related to cash loans: Accident Package
(Pakiet Wypadkowy), Care Package (Pakiet z Troską) and My Car (Moje Auto) insurance. The first two replaced existing
Safe Package (Pakiet Bezpieczny) and Senior Package (Pakiet Senior).
Other
In 2023, Santander Consumer Bank S.A. renewed or extended cooperation with four key partners from the household
appliances sector, maintaining its leadership position in the consumer finance market. Based on its partnership with the
largest retail chains in terms of instalment loans, the Bank increased the use of remote channels in terms of number and
value.
Debt sale
In 2023, Santander Consumer Bank S.A. sold the written-off loan portfolio of PLN 669.2m, with a P&L impact of PLN
116.1m gross (PLN 94.5m net).
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X. Organisational and infrastructure development
1. Organisational changes in Santander Bank Polska S.A.
Hybrid work model
Since September 2022, employees of the Business Support Centre of Santander Bank Polska S.A. have worked in a hybrid model that combines onsite
and remote work in a flexible but balanced way.
Managers’ responsibility is to plan work in a manner that allows employees to build relationships and benefit from cooperation and teamwork when
working from office, and to fulfil their personal and organisation’s needs when working remotely.
In 2023, the internal regulations and banking processes were changed in consultation with trade unions to implement the remote work solutions arising
from the amended Labour Code (Act of 1 December 2022 amending the Labour Code and certain other acts, published in the Journal of Laws no. 240 of
6 February 2023). As the state of epidemic was lifted on 1 July 2023, the rules for teleworking were further reviewed and the updated regulations became
effective on 1 October 2023.
In line with the Bank’s paperless agenda, a solution was implemented at the end of September 2023 to enable employees to apply for remote work
electronically using the self-service HR portal.
At the start of 2023, employees were asked to complete a survey and share their thoughts about their needs connected with office work and its
organisation. Based on the results, a number of initiatives were undertaken. For example, a project was launched to remodel office space in the Bank’s
main locations to better meet the requirements arising from the hybrid work model.
In Wrocław, all employees were relocated to the modern office building at Robotnicza.
In Poznań, refurbishment of non-Agile office space was started to improve its quality and functionality.
In Warsaw, changes to office space are being designed in line with the new standards.
Optimisation of the organisational structure
In 2023, the organisational structure of Santander Bank Polska S.A. was changed to increase the operational efficiency of the organisation through its
better alignment with the business environment and optimisation of management processes.
Retail Banking
Division and
Branch Network
The following units were separated from the Retail Banking Division to form the Wealth Management and Insurance
Division: Santander Brokerage Poland, Private Banking and Wealth Management Department, Bancassurance Area and the
Support and Distribution Office. This change was intended to strengthen the business focus on the mass market, increase
the effectiveness of sales management and facilitate digital transformation of this segment. At the same time, the new
structure reflects the global functional structure of Santander Group.
The Omnichannel Area was moved to the Digital Transformation Division.
The above changes in the Retail Banking Division and the Branch Network strengthened the functional dependence between
the Distribution and Business Support Centre across all segments, products and channels and enhanced the cooperation with
other Divisions of the Bank. The structure was adjusted to the newly defined strategic areas. To that end, the Retail Customer
Segment and the External Distribution Area were established and the reporting lines of the Multichannel Communication
Centre, CRM Area and the Consumer Finance Area were changed – these units now report directly to the member of the
Management Board.
The Multichannel Communication Centre was divided into two areas: the Multichannel Communication Area which took over
service functions and Distribution Area Sales functions which were delegated sales functions. The division of sales and
service functions is an element of the transformation process delivered in line with the Total Experience philosophy aimed
to create best experience for customers and employees.
Management Board Report on Santander Bank Polska Group Performance in 2023
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Digital
Transformation
Division
The structure of IT Areas supporting retail and corporate business and operating within the CIO (Chief Information Officer)
structure was extended. Furthermore, the Commercial Financing IT Area was established, with the responsibility for
maintenance and development of IT systems supporting the corporate lending process. The Corporate Banking IT Area was
renamed the Corporate Transactional Banking IT Area.
The Omnichannel Area, whose role is to develop the omnichannel product distribution and service platform, was moved
from the Retail Banking Division to the CIO structure. To optimise business processes related to complaints handling,
effectiveness management and operations development, the Complaints and Customers Relationship Department and the
Effectiveness and Development Operations Department were set up in the Central Operations Area.
The Cyberthreat and Transaction Fraud Detection Department was established in the CISO (Chief Information Security
Officer) structure to monitor IT systems, card transactions and customer activity in electronic channels.
Wealth
Management and
Insurance Division
For information about the new Wealth Management and Insurance Division created from the units of the Retail Banking
Division, see the section on the Retail Banking Division.
Business and
Corporate Banking
Division
The following units were established in the Business and Corporate Banking Division: Business Development and Service
Area, Business Service Department and Trade Finance Department. The purpose of this comprehensive reorganisation (which
includes the lower-level units) is to replace the geographical management structure with segmental management structure.
Corporate and
Investment
Banking Division
The role of the Chief Financial Markets Officer was established in the Corporate and Investment Banking Division to centralise
support, product and sales units in the Financial Markets Area. As a result, the Financial Markets Products Tribe no longer
reports directly to the Management Board member in charge of the Corporate and Investment Banking Division but has a
dotted reporting line to the Chief Financial Markets Officer.
The compliance and finance functions of the Division were decentralised. Both areas now report directly to the Management
Board member in charge of the Corporate and Investment Banking Division. The CIB Finance and Operational Support
Department was liquidated and two new departments were set up in its place: CIB Finance Department and CIB Business
Development and Service Department, both of which report to the Management Board member in charge of the Corporate
and Investment Banking Division.
The new structure is intended to optimise CIB operations by mitigating operational risk and to strengthen the overall
supervision over credit processes.
Compliance and
FCC Division
The Compliance and FCC Division was set up to promote the risk culture and control model and to centralise the second line
of defence functions. It combines extended prevention functions (AML, fraud prevention, control and compliance) with
proactive use of data and analyses based on business intelligence solutions. The Division was created from the former second
line of defence units from the Risk Management Division, the Digital Transformation Division and the Legal and Compliance
Division. The above solution increases the effectiveness of the partnership between the first and second lines of defence.
Artur Głembocki, the newly appointed Management Board member, is in charge of the new Division.
Legal and
Compliance
Division
The Legal and Compliance Division was liquidated as a result of the transfer of the Compliance Area to the new Compliance
and FCC Division. The Compliance Area now reports directly to the President of the Management Board.
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> Organisational units of the Business Support Centre of Santander Bank Polska S.A.
Agile methodology at Santander Bank Polska S.A.
To achieve lasting success in a dynamically developing market, Santander Bank Polska S.A. has been steadily increasing the use of Agile methods in day-
to-day work of interdisciplinary teams.
Currently, there are 18 Tribes at the Bank, and nearly two thousand employees work in Agile structures. Agile units commonly use Jira (a comprehensive
tool for standardisation of processes and workflows in teams) and a uniform quarterly planning process. The development of Agile competencies in
Tribes and non-Agile structures is supported by Agile Coaches.
In 2023, the quality of service requests made with the teams was significantly improved, reducing the number of rejected requests by 80%, the software
development registration and workflow was standardised, a development programme for product owners was launched, and elements of the Agile way
of working were implemented in non-Agile units such as Operations and HR.
2. Organisational structure of Santander Consumer Bank S.A.
The organisational structure of the head office of Santander Consumer Bank S.A., which is aligned with the Agile model applicable across the organisation
since September 2021 (divisions replaced by tribes), was stable in 2023. Changes were limited and did not significantly affect the scope of tasks delivered
by individual units.
The table below presents the roles and responsibilities of members of the Management Board of Santander Consumer Bank S.A.
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> High-level organisational structure of Santander Consumer Bank S.A.
3. Changes in the structure of Santander Bank Polska Group
Compared with 31 December 2022, the composition of Santander Bank Polska Group excludes Santander Consumer Finanse Sp. z o.o. w likwidacji, a
subsidiary of SCB S.A. For more information about this change and members of Santander Bank Polska Group is presented in Chapter II, Part 2 “Structure
of Santander Bank Polska Group”.
4. Changes in the equity investment portfolio
Selected investments in the investment securities portfolio
As at 31 December 2023 and 31 December 2022, Santander Bank Polska Group owned at least 5% of share capital or voting power in the following
companies:
No.
Company
% in the share
capital
% of the total
votes at AGM
% in the share
capital
% of the total
votes at AGM
31.12.2023
31.12.2023
31.12.2022
31.12.2022
1.
Polski Standard Płatności Sp. z o.o.
14.29%
14.29%
14.29%
14.29%
2.
Krajowa Izba Rozliczeniowa S.A.
14.23%
14.23%
14.23%
14.23%
3.
System Ochrony Banków Komercyjnych S.A.
12.91%
12.91%
12.91%
12.91%
4.
Biuro Informacji Kredytowej S.A.
7.72%
9.22%
7.72%
9.22%
5.
Hortico S.A.
1)
5.81%
5.81%
5.98%
5.98%
1)
Companies from the portfolio of equity investments of Santander Inwestycje Sp. z o.o.
According to the equity portfolio management strategy of Santander Bank Polska Group, investments not connected with the Bank’s core business are
limited.
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Conversion of series C preference shares of Visa Inc.
As a result of the settlement of acquisition of Visa Europe Limited by Visa Inc. on 21 June 2016 and acquisition of assets of Deutsche Bank Polska S.A.,
Santander Bank Polska S.A. received 21,032 series C preference shares of Visa Inc. entitling it to acquire series A preference shares convertible to series
A ordinary shares.
Due to the subsequent conversions of series A preference shares of Visa Inc. to ordinary shares and sale of those shares in a total number of 66.8k, a
profit of PLN 2.9m was recognised in 2023.
On 12 September 2023, 21,032 series C shares of Visa Inc. (indirectly convertible to 76,325k series A ordinary shares listed on the NYSE) were sold at a
discount. The stock market price was approx. PLN 1,078 per one series A share of Visa. The purpose of the transaction was to mitigate the risk of
movements in the share price of Visa Inc. After the transaction was closed, a provision of USD 266.5 thousand was raised for expected future costs of the
sales transaction.
On a Ytd basis, a profit of PLN 3.8m was generated in 2023 on Visa shares (taking into account the provision raised).
Selected agreements
Agreement with International Finance Corporation
On 22 September 2023, the Bank signed an Upsize Agreement with the International Finance Corporation (IFC) as a continuation of the Guarantee
Agreement of 31 March 2022. The Upsize Agreement allows the Bank to increase the volume of the securitised cash loan portfolio to PLN 2.9bn and
release an additional capital of approx. PLN 200m. The capital will be used to finance further ESG activities of both Santander Bank Polska S.A. and the
World Bank Group (of which the IFC is a member). The Bank will PLN 100m worth of retail and SME loans to Ukrainian customers who live and work in
Poland. It is the first initiative of this kind in Poland.
Securitisation
In September 2023, Santander Leasing S.A. securitised a portfolio of loans and leasing facilities totalling EUR 514m. As part of that synthetic
securitisation, the company entered into a guarantee agreement with the European Bank for Reconstruction and Development (EBRD) to secure the
selected portfolio of the above-mentioned facilities. The transaction is set to expire on 28 February 2032. The securitised portfolio is divided into three
tranches: senior (88%), mezzanine (10.7%) and junior (1.3%). The mezzanine tranche is fully guaranteed by the EBRD. The first loss (junior) tranche and
senior tranche are retained by Santander Leasing S.A. The transaction provides for a 12-month replenishment period.
The synthetic securitisation structure set up under the guarantee agreement does not generate any additional exposure to risks typical of traditional
securitisation transactions (such as liquidity risk inherent in securitised assets). The transaction meets the STS (Simple, Transparent and Standardised)
securitisation criteria specified in the CRR.
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5. Development of distribution channels of Santander Bank Polska S.A.
Santander Bank Polska S.A. invests in the digitalisation of business and development of digital tools to provide highly innovative and top quality services.
The range of functionalities available in the distribution channels is steadily extended, as is the accessibility of services. The Bank’s focus is to grow sales
in remote channels and increase the share of self-service branches.
Basic statistics on distribution channels
Santander Bank Polska S.A.
31.12.2023 31.12.2022
Branches (locations)
319
335
Off-site locations
2
2
Santander Zones (acquisition stands)
15
14
Partner outlets
171
170
Business and Corporate Banking Centres
6
6
Single-function ATMs
351
472
Dual-function machines
890
952
Registered internet and mobile banking customers
1)
(in thousand)
5,012
4,869
Digital (active) mobile and internet banking customers
2)
(in thousand)
3,497
3,285
Digital (active) mobile banking customers
3)
(in thousand)
2,608
2,452
iBiznes24 – registered companies
4)
(in thousand)
26
20
1) The number of customers who signed an electronic banking agreement under which they can use the available products and services.
2) The number of active internet and mobile banking users (digital customers) who at least once logged into internet or mobile banking or checked their balance without logging in the last month of the reporting period.
3)
The number of active mobile banking customers who at least once logged into the mobile application or its light version or checked their balance without logging in the last month of the reporting period.
4) Only customers using iBiznes24 – an electronic platform for business customers (the customers having access to Moja Firma plus and Mini Firma platforms are not included).
Traditional distribution channels
As at 31 December 2023, Santander Bank Polska S.A. had 319 branches, 2 off-site locations, 15 Santander Zones and 171 partner outlets. During the
year, the number of bank outlets (branches, off-site locations and Santander Zones) decreased by 15, and the number of partner outlets increased by 1.
In 2023, 19 branches were remodelled, increasing the total number of modernised outlets to 208 (65% of the branch network).
165
165 165 170 170
170
171
171
13
13
16
16
17 17
17
17
363
356
347
335
332
328
325
319
541
534
528
521
519
515
513
507
31-Mar-2022 30-Jun-2022 30-Sep-2022 31-Dec-2022 31-Mar-2023 30-Jun-2023 30-Sep-2023 31-Dec-2023
Number of branches and partner outlets of Santander Bank Polska S.A.
by quarter in 2022 and 2023
Partner outlets Off-site locations and Santander Zones Branches
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649
606
560
521
507
31-Dec-19 31-Dec-20 31-Dec-21 31-Dec-22 31-Dec-23
Number of branches and outlets
of Santander Bank Polska S.A. in years 2019-2023
Below are the key branch network projects delivered in 2023:
Launch of another branch in the Work Café Light model (branch no. 2 in Łódź) combining traditional banking space (cashier services and customer
advisors’ support) with coworking and meeting space (including free WiFi, printing etc.)
Pilot remodelling of selected branches to outlets without cashier services in different locations in Poland. The branches have self-service zones
which are open 24/7. The pilot includes an educational campaign promoting cards and mobile application as convenient and safe tools. By the end
of 2023, the number of branches without cashier services increased to 32.
Pilot of the geolocation project aimed to link retail customers to branches they visit most often. The pilot implementation is scheduled for January
2024 and is to cover 500k customers.
As at the end of December 2023, the Private Banking model included 61 Private Banking Directors based in 24 outlets across Poland (4 Private Banking
Centres and 20 other locations).
Services to businesses and corporations were provided by two departments: the Business Clients Department and the Corporate Clients Department with
their 6 Banking Centres (3 Business Banking Centres and 3 Corporate Banking Centres) operating within three regional structures through 29 offices
located Poland-wide. Premium customers and entities from the public and commercial properties sector were handled by four dedicated offices.
Intermediaries network
Indirect distribution channels, whose main role is to acquire new customers, include mainly agents and intermediaries/ brokers.
In 2023, the external network (Mobile Agent Network) employed 246 people on average per month. The Bank used their services to offer cash
loans, mortgage loans, SME loans, loan insurance, personal and business accounts, and leasing facilities.
Cooperation with financial and real estate brokers (network agents) was centrally managed under ten agreements. The mortgage loan offer
did not change, neither did the terms of cooperation between the Bank and brokers.
ATMs
As at 31 December 2023, the network of self-service devices of Santander Bank Polska S.A. comprised 1,241 units, including 351 ATMs (dispensing cash
only) and 890 dual function machines (including 484 recyclers, i.e. devices enabling withdrawal of cash that has been previously deposited by other
customers).
In September 2023, the Bank started to migrate the machines to the ATM–as–a–service model of Euronet. Through this partnership, the Bank will provide
access to more innovative and convenient ATMs and CDMs. Industry experts will provide maintenance and support in case of any incidents. The migration
is planned to be completed in October 2024.
Remote channels
In 2023, Santander Bank Polska S.A. continued to improve the functionality and capacity of digital contact channels in line with its long-term strategy
which is to increase the share of such channels in customer acquisition and sales.
The changes were intended to improve the user-friendliness of existing features and processes, and add new ones, while enhancing security of
operations. Furthermore, channel integration was continued, harmonising customer service across the Bank.
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Electronic channel
Selected solutions and improvements introduced in 2023
santander.pl
In 2023, extensive measures were taken to increase the digital accessibility of santander.pl by implementing the Web
Content Accessibility Guidelines (WCAG) in at least 80%. While the above objective was exceeded, the ultimate goal is
set at around 90%. Starting from 2025, it will be a statutory obligation to ensure compliance with WCAG.
The portal has been an increasingly effective tool in terms of customer acquisition and product sales. The number of
accounts sold through that channel increased by 35% YoY thanks to close cooperation with the eCommerce Department
and optimised sales paths.
In 2023, santander.pl was promoted in a number of articles published on specialist websites: “How to accelerate a
company’s website: a guide for managers”, “Our ambition: to have the best banking website in Poland”, “Digital
experience platform as a tool for delivery of one of our priorities: ESG”.
The accelerated santander.pl website was recognised in the “Hit of the Year” category of the annual competition
organised by Gazeta Bankowa.
Internet and mobile
banking
In September 2023, the Bank launched a new version of the Santander mobile application featuring:
revamped functions such as balance check, transfers, your products, BLIK, Santander open, Kantor Santander,
contactless payments, product range;
customisation options (wallpapers, personalised greetings, themes);
discreet mode (account balance visible only to the user);
Price Advisor function (showing the criteria to be met to reduce account maintenance and card fees to PLN 0) and
carbon footprint tracker (showing the customer’s estimated carbon footprint based on shopping paid for with the
Bank’s cards);
tips on how to save money and the environment;
access to BLIK payments for sole traders using Mini Firma e-banking service.
More than 2 million customers logged into the new mobile application within the first two weeks of the launch, and
presently it is used by 2.7 users. The previous version was disabled after one month.
The new application is more readily used for mobile authorisation. The number of customers using that functionality
increased from around 390 thousand as at the end of August 2023 to nearly 2.7 million as at the end of December 2023
(more than 98% of mobile customers).
Santander open
In Q1 2023, the scope of account aggregation services available as part of Santander open was extended to include Nest
Bank S.A. Santander Bank Polska S.A. also cooperates with eight other banks: Alior Bank S.A., Bank Millennium S.A., BNP
Paribas S.A., Cre
dit Agricole S.A., ING Bank Śląski S.A., mBank S.A., PKO BP S.A., Pekao S.A., enabling customers to integrate
accounts online (AIS) and initiate transfers (PIS) via electronic and mobile banking in relation to accounts held with any of
the above banks.
Multichannel
Communication Centre
(MCC)
In 2023, the MCC continued to integrate channels and expand the range of processes and tools, using the latest
technologies. Projects were underway to facilitate the work of advisors and standardise customer service across the Bank
(through cross-product harmonisation and identification of processes that can be delivered using self-service solutions).
Processes, improvements and solutions implemented in 2023
Optimisation of execution of debit card agreements with Select customers in accordance with the KNF requirements.
Increasing the accessibility of services for customers by extending the scope of processes delivered by the MCC to include
those previously available only in branches:
Adding a user to the Mini Firma electronic banking services via the Online Advisor channel.
Applying for a duplicate account statement after closing an account via the phone channel.
Updating an ID card via the video channel (Advisor Online) (logged-in customers only).
Reposting funds to an account indicated by the customer in an instruction placed via the phone or Online Advisor
channel after closing a credit card account or a cash loan account.
Introduction of the retention offer for business customers (temporary waiver of card, ATM and smsCode fees). Launch of
retention activities in the areas affecting decisions of account holders.
Verification of the customer’s identity in the video channel –
replacing manual verification of the customer’s identity
document with automatic verification via Online Advisor.
Implementation of new process and tools for managing the Worry-free Loan (Spokojny Kredyt) CPI insurance in line with
the KNF requirements, including an automated dispatch of regulations to customers.
Support for customers in migration to the new mobile application (One App): training for advisors and resolution of errors
reported by customers.
Development of the chatbot services available at santander.pl. Extension of the scope of information and materials
available to customers.
The new features of iBiznes24 for corporate customers are described in Chapter IX “Business development in 2023”, section on Business and Corporate
Banking and Corporate and Investment Banking.
E-commerce
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Santander Bank Polska S.A. develops an e-commerce channel to sell strategic products online. The Bank offers personal accounts, business accounts and
cash loans in partnership with affiliate networks in Poland, i.e. the largest online platforms. The Bank also takes active measures in electronic channels
(website, electronic banking platform, mobile application) in relation to existing customers, providing them with tailored products and services.
Active digital customer base
As at 31 December 2023, the number of digital customers (i.e. electronic banking customers who used electronic banking services at least once a month)
went up by 6.4% YoY to 3.5m, accounting for 69.8% of customers with access to electronic banking services. The number of active mobile banking users
increased by 6.4% YoY to 2.6m (including 1.6m customers who used Santander mobile only and 738.0k customers who used only internet banking). In
2023, mobile application users made 293.2m transactions (up 27.1% YoY). At the same time, the number of transactions on internet banking platform
decreased by 3.0% YoY to 201.2m.
6. Development of distribution channels of Santander Consumer Bank S.A.
The section below presents the main sales channels of Santander Consumer Bank S.A.
Santander Consumer Bank S.A.
31.12.2023 31.12.2022
Branches
50
50
Partner outlets 250
263
Car loan sales partners 1,266
1,188
Instalment loan sales partners
5,887
6,085
Registered internet and mobile banking customers
1)
(in thousand) 1,413
1,404
Digital (active) mobile and internet banking customers
2)
(in thousand)
751
348
Digital (active) mobile banking customers
3)
(in thousand)
403
276
7. IT development
Development of IT resources
Santander Bank Polska Group continues to automate its infrastructure in line with the “infrastructure as a code” methodology, eliminating manual
delivery and installation of servers. This way, the Group reduces infrastructure management costs and speeds up deployments.
The telecommunications network across all branches was modernised by implementing the SD-WAN (Software Defined Wide Area Network)
architecture. This solution facilitates flexible traffic management and ensures appropriate performance for the key applications used by branch advisors.
The Bank successfully deployed the Microsoft Azure Landing Zone solution, creating an operating model for further use of cloud services. The new
platform positions the Bank as a modern financial institution that is ready to raise to dynamic challenges of the digital world.
Around 2.4 thousand employees had their amortised laptops replaced, which increased the comfort of their work and effectiveness of customer service.
The Digital Transformation Division has stable and gender-balanced workforce. Employees with more than nine years of service are the largest
population. The proportion of male and female employees is equal at 50%.
Main IT development directions
In 2023, Santander Bank Polska Group concentrated on accelerating digitalisation, creating innovative solutions using the latest technologies and
ensuring unparalleled customer service. In operational terms, a special focus was placed on security, stability of systems as well as automation and
simplification of processes.
Operations in the selected areas were being streamlined and this process will be continued going forward. In Q3 2023, the “Just Simpler”
programme was set up to complete the Paperless Bank transformation and to simplify and digitalise the selected post-sales processes for retail
and corporate customers.
The banking system technology was further improved to ensure failure-free operations and enhance the quality of customer service.
Measures were underway to launch a cloud-based data platform.
1)
Customers who signed an agreement with Santander Consumer Bank S.A. and at least once used the bank’s electronic banking system in the reporting period.
2) The number of active internet and mobile banking users (digital customers) who at least once logged into internet or mobile banking or checked their balance without logging in the last month of the
reporting period.
3) The number of active mobile banking customers who at least once logged into the mobile application or its light version or checked their balance without logging in the last month of the reporting period.
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The migration of the card transaction authorisation system to a new database technology was continued. The purpose of the project is to improve
the system performance.
Banking operations were centralised and automated, making the work of branch staff more efficient and accelerating deployment of digital
solutions for customers.
Progress was made with regard to the implementation of a new complaint management application, which will allow the Bank to more effectively
monitor and control resolution times and harmonise all customer contact channels.
A project was in place to outsource ATM maintenance to enhance service quality (through increased availability and upgrade of machines) and
reduce costs. The project is planned to be closed by the end of 2024 with the full rollout of ATMs.
The above initiatives will be continued going forward to provide a range of modern and effective solutions for customers and position the Bank as a leader
in the financial sector. In 2024, the Group will also focus on the transformation of the lending process through the redesign of the sales model and
transition from traditional to digital services to grow sales in remote channels, reduce service costs and increase income.
Main projects
Continuation of digital transformation
The table below presents the selected IT projects delivered by Santander Bank Polska Group in 2023 in line with the digital transformation strategy.
Initiative
Key strategic projects delivered in 2023
Improvement of
availability, reliability
and performance of the
Bank’s systems
The Bank launched migration of the core card transaction authorisation system to a new database technology to improve
its reliability.
Active Directory (central user authentication service) was upgraded.
The SD-
WAN project was finalised, improving the capacity of network connections at branches through the upgrade of
routers to more modern solutions.
The operating system of the core banking system was upgraded to ensure continued support from IBM (security patches
and new functionalities).
The BCM tests of all critical systems of the Bank were successfully completed.
In 2023, the number of systems was reduced by 40% YoY as part of an ongoing process aimed to limit the number of
incidents.
Participation in global
optimisation initiatives
of Santander Group
The Bank launched a new mobile application for all customers.
The deployment of the cloud-based Microsoft Azure Landing Zone was completed.
A new scalable and flexible architecture was implemented, linking digital channels to transaction systems to further
develop digital processes and enhance customer experience. The new solution architecture was designed using best IT
practice to ensure stable and efficient back-end services for the Bank’s systems with customer data inputs.
Enhancement of
security of the Bank’s
systems
The anti-DDoS (Distributed Denial of Service) systems were further developed by implementing effective attack detection
and response mechanisms.
A system was
deployed to facilitate the reporting and management of cybersecurity incidents (in line with the National
Cybersecurity System Act).
Technical solutions were put in place to enhance the security of mobile devices used by the Bank’s customers.
Rules of the fraud prevention systems were refined in line with the changing cyber threat landscape.
The education campaign: “Don’t believe in fairy tales for adults” (“Nie wierz w bajki dla dorosłych”) was continued in social
media, reaching more than 4 million users, including younger audience (thanks to the use of new communication
channels). The campaign was also aired on the radio to reach people who less frequently use the internet (5.5 million
listeners).
More than six thousand primary and secondary school students took part in an online education campaign run by the Bank
in partnership with external institutions.
Onsite meetings were organised for Private Banking customers and members of local communities (including senior
citizens).
Regular messages were sent to personal and SME customers in electronic and mobile banking channels.
The Microsoft Intune cloud solution is being implemented on company phones to improve user experience.
The security, reliability and performance of web servers for electronic banking was improved through the migration to
WAS Liberty.
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Initiative
Key strategic projects delivered in 2023 (cont.)
Implementation of
regulatory
requirements
Work was underway as part of OneAML (KYC) to develop a solution for personal customers in line with the approved
requirements and the AML process.
The first stage of the project was completed in the Corporate Data Warehouse to implement recommendations and operating
procedures related to resolution and bail-in.
The gap identification and reporting process was further automated in line with the EBA guidelines.
Progress was made as part of the initial stage of the project aimed to implement ISO 20022. Registration of energy
performance certificates was started as part of the ESG agenda. Measures were taken to implement the monitoring of
missing certificates, along with a margin reduction for green mortgage loans.
A new solution was introduced to verify customer identity via the mObywatel application using an electronic ID document
(mDowód).
State aid measures:
a solution was designed to facilitate the reimbursement of fees on early repaid loans;
a solution was implemented to manage payment holidays (grace periods for principal and interest payments);
commercial grace periods were introduced for cash loan borrowers who can flexibly adjust their loan schedules and seek
assistance in case of problems with repayment.
WIBOR project – system analyses are underway with respect to the implementation of a solution based on lookback
compound interest calculation in the core banking system.
A new system is being implemented by Santander Brokerage Poland due to the replacement of the WSE trading system
(WATS).
Automation and
optimisation of
operational processes
The range of services was expanded to include instant incoming payments in EUR for all customers and outgoing
payments in EUR for corporate customers. Santander Bank Polska S.A. was the first bank in Poland to execute transfers
between accounts in different banks in real time.
A new functionality was implemented for customers wanting to make sure that the interest rate on their loans will not
rise above the level specified in an annex to the loan agreement in the case of interest rate hikes during the lending
period.
Santander Bank Polska S.A. is the first bank in Poland to accept earnings certificates from PUE ZUS.
The 2% Safe Mortgage (a state-subsidised loan) was implemented.
Personal customers were offered new accounts: Santander Account/ Konto Santander and Santander Max Account/
Konto Santander Max (at a subscription fee).
The outsourcing of the card personalisation process was completed.
The outsourcing of ATM services to Euronet is underway – the migration of ATMs to ITCARD is to be launched at the
start of 2024.
The table below presents other key operational projects delivered by Santander Bank Polska Group in 2023 in line with the main development directions.
Initiative
Key operational projects delivered in 2023
Improvement of
availability, reliability
and performance of the
Bank’s systems
The performance of the garnishee order management system was optimised in terms of storage and restructuring of
production database.
Credit collateral processes were modified, improving data quality, performance and security of the system.
Participation in global
optimisation initiatives
of Santander Group
A syndicated loan management system is being implemented.
Corporate and investment banking customers were migrated to a new platform, i.e. EBICS 3.0 (Electronic Banking Internet
Communication Standard), which helped to facilitate communication with companies from Poland and abroad.
Measures were taken to improve the availability and capacity of the system for the generation of transaction history in
remote channels.
The availability and resilience of the key payment system was increased.
Enhancement of
security of the Bank’s
systems
The application for document scanning and archiving at branches was upgraded in
accordance with the internal
cybersecurity recommendations.
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84
Initiative
Key operational projects delivered in 2023
Implementation of
regulatory
requirements
The Bank’s rating in the self-assessment of critical data management is 3.83 (on a scale from 1 to 4), which confirms
the accuracy, completeness, availability and high quality of reporting processes and data reported.
The Bank implemented the requirements arising from the Electronic Delivery Act with respect to electronic
communication with customers and state authorities.
Further measures were taken to implement the requirements arising from the Tax Ordinance Act ( STIR – an ICT system
of the clearing house) and the Financial Information System Act (SiNF).
Data flow between the system for communication with enforcement authorities and the garnishee order management
system was automated.
Automation and
optimisation of
operational processes
Post-sales mortgage loan services were centralised and digitalised. Borrowers can now manage their mortgage loans
from the comfort of their home: place instructions, send and receive documents from the Bank and execute an annex to
the agreement. The process is faster, simpler and more environmentally sustainable.
A new, fast mortgage loan sales process based on scanned documents was implemented in the network of mortgage
intermediaries and agents.
The 4P Programme was completed: the number of products was decreased by 70, paper consumption was reduced by
more than 60%, nearly 80 process changes were implemented and more than 90% customer correspondence was sent
electronically.
Achievements in innovation and research and development
In 2023, Santander Bank Polska S.A. implemented an innovative solution: the new Santander mobile application, which was used by approx. 2.6m
customers as at the end of December 2023 r. It is an intuitive and safe tool that will help the Bank increase NPS and develop relationships with customers.
The new application is a global solution and the largest project of this kind implemented in Europe. The customer migration was smooth and its progress
was monitored in real time from the War Room.
The new application comes with a range of innovative features including:
carbon footprint tracker confirming the Bank’s commitment to sustainable development;
locator of ATMs and branches across Santander Group;
free transfers to Santander accounts abroad and free cash withdrawals in the ATM network;
BLIK service for SME customers.
8. Capital expenditure
In 2023, Santander Bank Polska Group incurred PLN 634.9m worth of capital expenditure compared with PLN 449.0m in 2022. The majority of expenses
were spent on projects aimed at developing systems, software and hardware, as well as purchasing and maintaining software licences. In terms of the
amount of expenditure and benefits for customers, particularly noteworthy is the replacement of servers as part of LCM and improvement of their
capacity, implementation of the new mobile application, further development of the iBiznes24 electronic banking platform and a new brokerage system
for Santander Brokerage Poland. Last year, the Bank also continued the One AML Programme, which aims at creating a Group solution to support the
prevention of money laundering and terrorist financing. A range of process and technological optimisations were implemented, ensuring compliance
with the policies of Santander Group and financial crime prevention regulations. They included, among other things, the centralisation of processes
related to non-bank financial institutions. The Bank also introduced changes to improve the performance of the corporate lending platform and took
measures to integrate the channels and extend the scope of processes and tools available with the Multichannel Communication Centre using the latest
technologies.
The most capital-intensive IT projects are described above in the “Key IT projects” and “Remote channels” sections.
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XI. Financial performance in 2023
1. Consolidated income statement
Structure of Santander Bank Polska Group’s profit before tax
Condensed consolidated income statement
of Santander Bank Polska Group in PLN m (for analytical purposes)
2023
2022
restated data
4)
YoY change
Total income 15,992.3 12,381.5
29.2%
- Net interest income 13,115.9 9,652.3 35.9%
- Net fee and commission income 2,717.0 2,566.4 5.9%
- Other income
1)
159.4 162.8 -2.1%
Total costs (4,715.0) (4,697.7) 0.4%
- Staff, general and administrative expenses (3,934.8) (3,977.5) -1.1%
- Depreciation/amortisation
2)
(569.5) (523.6) 8.8%
- Other operating expenses (210.7) (196.6) 7.2%
Net expected credit loss allowances
(1,149.4)
(894.7)
28.5%
Cost of legal risk connected with foreign currency mortgage loans
3)
(2,592.3)
(1,739.1)
49.1%
Profit/loss attributable to the entities accounted for using the equity method 96.9 84.1 15.2%
Tax on financial institutions
(782.5)
(781.1)
0.2%
Consolidated profit before tax 6,850.0 4,353.0 57.4%
Corporate income tax (1,902.2) (1,344.2) 41.5%
Net profit for the period 4,947.8 3,008.8 64.4%
- Net profit attributable to the shareholders of the parent entity
4,831.1
2,799.1
72.6%
- Net profit attributable to the non-controlling shareholders 116.7 209.7
-44.3%
2 987,6
3 525,6
2 353,6
3 514,7
3 730,5
3 870,1
4 222,1
4 169,6
1 426,1
1 046,6
531,3
1 349,0
1 656,0
1 556,2
2 124,4
1 513,4
Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2024 Q4 2024
The Group's total income and profit before tax by quarter in 2022 and 2023
Total Income Profit Before Tax
PLN m
+18.6%
YoY
+12.2%
YoY
1)
Other income includes total non
-interest and non-fee income of the Group comprising the following items of the full income statement: dividend income, net trading income and
revaluation, gain/loss on other financial
instruments, gain/loss on derecognition of financial instruments measured at amortised cost and other operating income.
2)
Depreciation/amortisation includes depreciation of property, plant and equipment, amortisation of intangible assets and depreciation of the right-of-use asset.
3)
4)
This line item includes raised and released provisions for legal risk and legal claims related to foreign currency mortgage loans. Together with “Gain/loss on derecognition of financial instruments measured at amortised
cost” (included in “Other income”),
it presents the total impact of legal risk connected with the above-
mentioned loans on the Group’s performance in line with the accounting treatment based on IFRS 9. Starting from
I
n Q4 2023, the comparative data were restated in line with the KNF’s recommendation to reverse the effects of the reclassification of PLN 10,521.7m worth of debt securities measured at fair value thro
ugh other
comprehensive income made in 2022 to debt investment financial assets measured at amortised cost totalling PLN 12,380.2m.
The reversal of reclassification had the following impact on the income statement:
interest income on financial assets measured at amortised cost was reduced by PLN 154.1m and interest income on assets measur
ed at fair value through other comprehensive in
come was increased by that amount.
The event is neutral in terms of the net profit..
I
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9 462,1
8 647,3
9 141,6
12 381,5
15 992,3
3 244,6
1 880,9
2 057,8
4 353,0
6 850,0
2019 2020 2021 2022 2023
The Group's total income and profit before tax in years 2019-2023
Total Income Profit Before Tax
PLN m
+29,2%
YoY
+57,4%
YoY
The profit before tax of Santander Bank Polska Group for the 12-month period ended 31 December 2023 was PLN 6,850.0m, up 57.4% YoY. The profit
attributable to the shareholders of the parent entity increased by 72.6% YoY to PLN 4,831.1m.
The table presented in the “Comparability of periods” section below contains the selected items of the income statement of Santander Bank Polska
Group which affect the comparability of the analysed periods. After the relevant adjustments:
the underlying profit before tax increased by 14.9% YoY;
the underlying profit attributable to the shareholders of the parent entity went up by 16.7% YoY.
Comparability of periods
Selected items of the income statement
affecting the comparability of periods
2023 2022
Cost of legal risk connected with foreign
currency mortgage loans
(income statement item)
PLN 2,592.3m PLN 1,739.1m
Cost of settlements connected with foreign
currency mortgage loans
(gain/loss on derecognition of financial
instruments measured at amortised cost)
PLN 329.8m PLN 183.3m
Negative adjustment to interest income on
mortgage loans due to payment holidays
(interest income)
PLN 49.3m
PLN 1,544.4m, including PLN 1,538.0m
in relation to Santander Bank Polska
S.A., and PLN 6.4m in relation to
Santander Consumer Bank S.A.
Contributions to the Bank Guarantee Fund
made by Santander Bank Polska S.A. and
Santander Consumer Bank S.A.
(general and administrative expenses)
Contribution of PLN 174.6m to the bank
resolution fund
PLN 264.6m, including a contribution of
PLN 55.6m to the bank guarantee fund
and PLN 209.0m to the bank resolution
fund
Costs related to the Institutional Protection
Scheme (IPS)
(general and administrative expenses)
PLN 0.3m PLN 445.7m
Costs related to the Borrowers Support
Fund
(general and administrative expenses)
No corresponding costs
PLN 173.6m, including a contribution of
PLN 139.6m made by Santander Bank
Polska S.A., and a contribution of PLN
34.0m made by Santander Consumer
Bank S.A.
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4 353,0
6
850,0
+3 463,6
+150,6
+42,7
+12,8
- 1,4
- 3,4
-14,1
-45,9
-254,7
-853,2
Profit
before tax
for 2022
Net interest
income
Net
fee & commission
income
St aff,
general and
administrative
expenses
Profit
attributable
to the entities
accounted for
using the
equity method
Tax on financial
institutions
Other income Other
operating
expenses
Depreciation/
amortisation
Impairment
allowances
for expected credit
losses
Cost of legal risk
associated with
foreign currency
mortgage loans
Profit
before tax
for 2023
Changes in the key components of the consolidated profit before tax for
2023 vs 2022
Key components with a negative impact on a YoY change in PBT
Key components with a positiv e impact on a YoY change in PBT
Profit before tax for 2022 and 20 23
PLN m
+ PLN 2 497.0 m
Determinants of the Group’s profit for 2023
The largest contributor to the growth in the consolidated profit before tax of Santander Bank Polska Group for 2023 was net interest income, which
increased by 35.9% YoY. Excluding an impact of the negative adjustment due to payment holidays (PLN 49.3m in 2023 and PLN 1,544.4m in 2022) from
both analysed periods, the underlying net interest income was up 17.6% YoY. Higher net interest income is attributed to the growth in the Group’s credit
portfolios and the continuously high interest rate environment despite the reference rate cut of 100 b.p. in total by the Monetary Policy Council in
September and October 2023.
Gain on derivatives improved due to more favourable conditions in the money market, resulting in an increase of 141.8% YoY in net trading income and
revaluation. Gain on other financial instruments went up too (+PLN 18.0m YoY) due to the settlement of the conversion and sale of series A shares of Visa
Inc. and sale of all series C preference shares of that company, which limited the negative impact of movements in its share price.
Net fee and commission income was up 5.9% YoY on account of, among other things, net fee and commission income from the core business, i.e. lending
and guarantee activities and settlement and payment activities (card, electronic and payment services) as well as insurance activities and currency
exchange. A YoY increase was also observed in net fee and commission income from activities in the stock and investment fund markets reflecting trading
volumes, volatility of financial markets and higher value of average assets managed by the Group.
Staff, general and administrative expenses were down 1.1% YoY due to a substantially lower contribution to the aid fund of System Ochrony Banków
Komercyjnych S.A., lower amounts payable to the Bank Guarantee Fund and no need to make contributions to the Borrowers Support Fund. The financial
effect of lower contributions payable to systemic institutions was partly offset by an increase in other components of general and administrative expenses
and higher cost of salaries resulting from periodical pay rises in line with external and internal conditions.
The profit before tax for 2023 was negatively affected by the cost of PLN 2,922.1m in respect of legal risk and settlements connected with CHF mortgage
loans (+52.0% YoY) and higher expected credit loss allowances (+28.5% YoY) reflecting the negative impact of the economic situation on the quality of
the portfolio.
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Profit before tax of Santander Bank Polska Group by contributing entities
Components of Santander Bank Polska Group’s profit before tax
in PLN m (by contributing entities)
2023 2022 YoY change
Santander Bank Polska S.A.
6,396.3
3,598.3
77.8%
Subsidiaries:
587.3
832.5
-29.5%
Santander Consumer Bank S.A. and its subsidiaries
1)
254.9
563.5
-54.8%
Santander Towarzystwo Funduszy Inwestycyjnych S.A.
115.2
93.7
22.9%
Santander Finanse Sp. z o.o. and its subsidiaries
(Santander Leasing S.A., Santander Factoring Sp. z o.o., Santander F24 S.A.)
215.3
174.9
23.1%
Santander Inwestycje Sp. z o.o.
1.9
0.4
375.0%
Equity method valuation
96.9
84.1
15.2%
Exclusion of dividends received by Santander Bank Polska S.A. and consolidation
adjustments
(230.5) (161.9) 42.4%
Profit before tax 6,850.0
4,353.0 57.4%
Santander Bank Polska S.A. (parent entity of Santander Bank Polska Group)
The profit before tax of Santander Bank Polska S.A. was PLN 6,396.3m, up 77.8% YoY.
The results of Santander Bank Polska S.A. are presented in detail in Part 4 “Separate income statement”.
Subsidiaries
The subsidiaries consolidated by Santander Bank Polska S.A. reported a decline of 29.5% YoY in their total profit before tax.
SCB Group
The contribution of Santander Consumer Bank Group to the consolidated profit before tax of Santander Bank Polska Group for 2023 was PLN 254.9m
(after intercompany transactions and consolidation adjustments) and decreased by 54.8% YoY as a combined effect of the following:
Higher net interest income of PLN 1,342.8m (+2.3% YoY) achieved in the continuously high interest rate environment whose positive financial
result was offset by legislative solutions regarding the maximum non-interest costs of consumer loans (effective as of 18 December 2022) and
pressure of high interest rates on margins.
Higher net fee and commission income of PLN 122.1m (+2.9% YoY), including higher income on loans and lower income on credit cards and
insurance products.
Net expected credit loss allowances of PLN 172.7m compared with PLN 33.3m in the last year, resulting from:
No one-off items recognised in 2022 (such as the release of provisions following the change in the approach to the recognition of
legal risk connected with foreign currency mortgage loans and update of risk parameters).
Normalisation of credit risk along with changes in the credit portfolio structure (a lower share of mortgage loans and a higher share
of consumer loans).
A decrease of 19.0% YoY in other non-interest and non-fee income to PLN 63.2m on account of lower other operating income, higher loss on
derecognition of financial instruments measured at amortised cost as well as an increase in trading income and income on other financial
instruments.
Lower operating expenses of PLN 558.4m (-2.4% YoY) reflecting a decline in staff, general and administrative expenses, and in other operating
expenses.
Costs of legal risk of foreign currency mortgage loans were PLN 510.8m and 64.4% higher YoY as a result of an update of provisions for legal
claims and recognition of cost of legal risk of foreign currency mortgage loans reflecting the court ruling practice and borrowers’ tendency to
bring a case to the court.
1)
In both periods under review, SCB Group comprised Santander Consumer Bank S.A. and the following entities: Santander Consumer Multirent Sp. z o.o., Santander Consumer Finanse Sp. z o.o. w likwidacji (a
company in liquidation), Stellantis Financial Services Polska Sp. z o.o., Stellantis Consumer Financial Services Polska Sp. z o.o., Santander Consumer Financial Solutions Sp. z o.o. and SCM Poland Auto 2019-
1 DAC.
In 2022, SCB S.A. lost control over S.C. Poland Consumer 16-1 Sp. z o.o. due to the restructurin
g of the securitisation transaction and established a new entity to secure a retail loan portfolio: S.C. Poland Consumer
23-1 DAC. As the liquidation of Santander Consumer Finanse Sp. z o.o. w likwidacji was completed, in November 2023 the company was stru
ck off the register of entrepreneurs. The amounts provided above
represent profit before tax (after intercompany transactions and consolidation adjustments) of SCB Group for the periods indicated.
2)
Following the settlement of the securitization transaction Santander Bank Polska S.A. lost control over Santander Leasing Poland Securitization 01 Designated Activity Company based in Dublin in 2022, with which
it has no capital connections.
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Other subsidiaries
Profit before tax of Santander TFI S.A. for 2023 increased by 22.9% YoY to PLN 115.2m, as a result of 19.6% YoY higher net fee and commission income,
in relation to both success and management fees. Higher income from success fees is attributed to rates of return exceeding benchmarks for individual
sub-funds. On the other hand, higher income from management fees was driven by a YoY increase in the average assets under management on account
of strong net sales of investment funds and a positive change in the value of investment fund units. The asset growth was accompanied, however, by a
lower margin reflecting changes in the asset structure (increased share of low-margin assets, particularly short-term debt sub-funds). At the same time,
the company reported an increase in staff expenses (as a result of bonus payments and salary review) and in general and administrative expenses (on
account of costs of communication services, sales support, access to market reports and other categories of inflation-driven costs).
Profit before tax posted by companies controlled by Santander Finanse Sp. z o.o. totalled PLN 215.3m (up 23.1% YoY).
Total profit before tax of Santander Leasing S.A., Santander Finanse Sp. z o.o. and Santander F24 S.A. for 2023 grew by 33.3% YoY to PLN
141.3m, reflecting lower net expected credit loss allowances (-39.9% YoY) and higher net fee and commission income (+128.0% YoY) resulting
from an increase in insurance income and reduction in fees on synthetic securitisation. Strong sales generated in the reporting period (notably
in the vehicles segment) triggered a rise of 9% YoY in the lease portfolio as well as growth of 10.3% YoY in net interest income. The quality of
the lease portfolio remained high, with the NPL ratio of 3.63% (+0.05 p.p. YoY). The total result of the companies was negatively affected by
the valuation of IRS and currency hedges.
The profit before tax posted by Santander Factoring Sp. z o.o. increased by 7.4% YoY to PLN 74.0m, reflecting higher net interest income and
lower net expected credit loss allowances combined with lower net fee and commission income and higher staff, general and administrative
expenses.
Structure of Santander Bank Polska Group’s profit before tax
Total income
Total income of Santander Bank Polska Group for 2023 increased by 29.2% YoY to PLN 15,992.3m. Excluding the impact of payment holidays for PLN
mortgage loan borrowers and settlements with CHF mortgage loan borrowers (a total of PLN 379.1m in 2023 and PLN 1,727.7m in 2022), the underlying
total income was up 16.0% YoY.
Net interest income
Net interest income for 2023 was PLN 13,115.9m, up 35.9% YoY. Excluding the impact of a negative adjustment due to payment holidays, the underlying
net interest income increased by 17.6% YoY.
In Q3 2022, the Group estimated and recognised a negative adjustment to interest income on account of payment holidays for PLN mortgage loan
borrowers. The adjustment totalled PLN 1,358.2m and reflected the use of interest deferrals (up to four months per year) expected by the Group during
the solution application period (2022–2023). As the assumed percentage of deferred instalments increased, the estimates were revised upwards three
times, including by PLN 186.2m in Q4 2022, and by PLN 44.0m and PLN 5.3m in Q2 and Q4 2023.
The increase of 17.6% YoY in the underlying net interest income was driven by growth in business volumes in the favourable high interest rate
environment resulting from the series of 11 NBP interest rate hikes until September 2022 aimed at tightening the monetary policy and curbing inflation.
In September and October 2023, the first interest rate cuts of 0.75 p.p. and 0.25 p.p., respectively, were made since 2020 (with the reference rate reduced
to 5.75%), marking the start of the monetary policy easing cycle.
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2 244,0
2 934,8
1 640,7
2 832,8
3 092,3
3 200,2
3 395,5
3 427,9
Q1
2022
Q2
2022
Q3
2022*
Q4
2022*
Q1
2023
Q2
2023
Q3
2023**
Q4
2023**
Net interest income by quarter in 2022 and 2023
+21,0%
YoY
+1,0%
QoQ
PLN m
6 580,2
5 888,1
5 962,1
9 652,3
13 115,9
2019 2020 2021 2022 2023
Net interest income in years 2019-2023
PLN m
+35.9%
YoY
*
In H2 2022, net interest income included an adjustment of PLN 1,544.4m in total in respect of payment holidays.
**
In H2 2023, PLN 49.3m was recognised in this respect.
Interest income for 2023 totalled PLN 18,409.8m and was up 46.8% YoY, supported by the key categories of earning assets, mainly loans and advances
to business and personal customers and banks, and debt securities.
Interest expenses grew by 83.4% YoY to PLN 5,293.9m on the back of deposits from customers (including deposits from enterprises and the public sector
and from personal customers) as well as subordinated liabilities and liabilities due to debt securities in issue.
Loans & Advances to
Enterprises and Public Sector
29%
Finance Leases
5%
Debt Securities and Other
22%
Loans & Advances to
Individuals
44%
Structure of interest revenue for 2023
Loans & Advances to
Enterprises and Public
Sector
31%
Finance Leases
5%
Debt Securities and Other
22%
Loans & Advances to
Individuals
42%
Structure of interest revenue for 2022
Deposits from Enterprises &
Public Sector
39%
Deposits from Individuals
41%
Subordinated Loans and
Issue of Securities
11%
Deposits from Banks
and Other
9%
Structure of interest expense
for 2023
Deposits from Enterprises
& Public Sector
40%
Deposits from Individuals
27%
Subordinated Loans and
Issue of Se curities
16%
Deposits from Banks
and Other
17%
Structure of interest expense for 2022
In 2023, the cumulative net interest margin (annualised on a Ytd basis) was 5.39% vs 4.31% in 2022. The YoY margin increase of 1.08 p.p. is largely
attributed to the charge made in the comparative period in respect of the adjustment due to payment holidays, which was preliminarily estimated for the
entire period of availability of that solution. The YoY rise of 0.42 p.p. on a comparative basis reflects trends in the money market (including high official
interest rates in 2023 resulting from NBP rate hikes until September 2022) as well as higher business volumes and increased effectiveness of the Group’s
earning assets. This included growth in loans and advances to business customers and the public sector (+5.9% YoY), lease receivables (+11.8% YoY) and
loans and advances to individuals (+1.9% YoY). The above portfolios generated a total increase of 45.5% YoY in interest income. At the same time, the
cost of customer deposits went up by 119.9% YoY due to the Group’s acquisition activities and dynamic growth in term deposit balances.
The quarterly net interest margin (annualised on a quarterly basis) was fairly stable (5.37% in Q3 2023 vs 5.38% in Q4 2023), reflecting a continued rise
in credit receivables during the quarter, a decrease in deposits and the related costs as well as discounted expectations of further interest rate cuts. Lease
receivables grew by 2.0% QoQ, loans and advances to personal customers were up 0.8% QoQ and loans and advances to enterprises and public sector
entities were relatively stable (-0.1% QoQ). Meanwhile, term deposits from businesses and the public sector decreased by 17.6% QoQ and from
individuals – by 3.2% QoQ. The Group’s deposit and credit offer was modified in both periods in line with market trends and internal objectives in terms
Management Board Report on Santander Bank Polska Group Performance in 2023
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of competitive position, balance sheet structure, liquidity and profitability. At the same time, attractive savings solutions were put in place to increase
customer satisfaction.
4,02%
5,24%
3,06%
4,94%
5,40%
5,37%
5,37%
5,38%
4,02%
4,63%
4,10%
4,31%
5,40%
5,38%
5,37%
5,39%
2,00%
2,50%
3,00%
3,50%
4,00%
4,50%
5,00%
5,50%
6,00%
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Q2
2023
Q3
2023
Q4
2023
Net interestmargin
1)
by quarter in the years 2022 and 2023
(including swap points)
2)
Net interest margin
Cumulative net interest margin
1) Net interest margin curve annualised on a quarterly and year-to-date basis. The margin for Q3 2022 takes into account the estimated financial
impact of payment holidays and liabilities arising from regulations concerning mortgage loans in the total amount of PLN 1,430.0m compared to
PLN 192.7m recognised in Q4 2022. Excluding the impact of the above adjustments on the Group’s net interest income, at the end of September
2022 the cumulative margin was 4.86% and the quarterly margin was 5.58%, and at the end of December 2022 it was 4.96% and 5.28%,
respectively.
2) The calculation of the net interest margin of Santander Bank Polska S.A. takes account of swap points allocation from derivative instruments used
for the purpose of liquidity management but excludes interest income from the portfolio of debt securities held for trading and other exposures
connected with trading.
Net fee and commission income
Electronic and Payment Services
7%
Debit cards
12%
Account Maintenance &
Cash Transactions
14%
FX Fees
28%
Mutual Fund Distribution & Asset
Management
9%
Insurance Fees
10%
Credit Fees
14%
Credit Card Fees
4%
Brokerage Activities,
Guarantees & Others
2%
Net fee & commission income structure in 2023
Electronic and Payment Services
7%
Debit cards
11%
Account Maintenance &
Cash Transactions
16%
FX Fees
28%
Mutual Fund Distribution & Asset
Management
8%
Insurance Fees
9%
Credit Fees
14%
Credit Card Fees
5%
Brokerage Activities,
Guarantees & Others
2%
Net fee & commission income structure in 2022
Net fee and commission income (PLN m)
2023
2022
YoY change
FX fees
761.2
730.4
4.2%
Credit fees
1)
372.9
359.5
3.7%
Account maintenance and cash transactions
2)
370.5
401.4
-7.7%
Debit cards
315.8
283.0
11.6%
Insurance fees
267.7
229.3
16.7%
Asset management and distribution
237.3
199.1
19.2%
Electronic and payment services
3)
202.9
193.7
4.7%
Credit cards
116.9
119.9
-2.5%
Brokerage activities
126.3
115.4
9.4%
Guaranties and sureties 55.7
32.7
70.3%
Other fees
4)
(110.2) (98.0) 12.4%
Total
2,717.0
2,566.4
5.9%
1)
Net fee and commission income from lending, factoring and leasing activities which is not amortised to net interest income. This line item includes inter alia the cost of credit agency.
2)
Fee and commission income from account maintenance and cash transactions was reduced by the corresponding expenses which are disclosed under “Other” in Note 7 to the Consolidated Financial
Statements of Santander Bank Polska Group for 2023 (PLN 20.6m for 2023 and PLN 20.6m for 2022).
3)
Fees for payments (foreign and mass payments, Western Union transfers), trade finance, services for third party institutions as well as other electronic and telecommunications services.
4)
Issue arrangement fees and other fees.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
92
660,7
620,7
665,8
619,2
662,4
677,6
666,9
710,1
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Q2
2023
Q3
2023
Q4
2023
Net fee & commission income by quarter in 2022 and 2023
PLN m
+14,7%
YoY
+6,5%
QoQ
2 128,2
2 152,1
2 487,1
2 566,4
2 717,0
2019 2020 2021 2022 2023
Net fee & commission income in years 2019-2023
+5,9%
YoY
PLN m
Net fee and commission income for 2023 was PLN 2,717.0m and increased by 5.9% YoY. Significant or moderate growth was reported in the majority of
business lines, notably in guarantees and sureties, debit cards, loans and insurance, and asset management and distribution. On the other hand, despite
a moderately higher volume of accounts a decrease was reported in account maintenance fees because of the fee and charge management schemes and
promotional and preference terms offered to customers. Slightly lower net fee and commission income was generated on the credit card portfolio of
Santander Consumer Bank S.A.; however, it reflected standard fluctuations in the business activity.
The key changes to net fee and commission income items were as follows:
An increase of 3.7% YoY in net credit fee income is a combined effect of the Group’s services related to project finance for corporate customers,
modification of fees in line with market trends and lower cost of agency services.
A rise of 11.6% YoY in net income from debit cards is a combined effect of many factors, including a growing number of cards (+3.5% YoY), a
higher value of non-cash transactions made with such cards (+14.5% YoY), a positive impact of inflation and limitation of pricing concessions
and promotions offered by the Group compared to the last year.
Net fee and commission income from guarantees and sureties was up 70.3% YoY as a result of growth in guarantee business coupled with
lower costs related to securitisation transactions.
Net fee and commission income disclosed under the Group’s electronic and payment services went up by 5.3% YoY on account of international
payments and services provided to third party institutions.
Net FX fee income increased by 4.2% YoY as a result of higher average quotations (+4.5 b.p.) accompanied by lower FX turnover (-4.7%). While
the turnover in the eFX channel declined in the retail customer segment, growth was reported in the volume and net income in the business
customer segments. In the traditional channel, higher turnover was observed across all customer segments.
Higher net income from brokerage activities (+9.4% YoY) reflects improved stock market conditions in the better-than-expected macroeconomic
environment. In the comparative period, a recovery reported at the start of the year was followed by higher volatility in response to Russia’s
invasion of Ukraine, which encouraged an increased investor activity. In 2023, the situation largely normalised until July, but investor sentiment
reversed in August and September, and the volatility of the domestic market increased significantly following the sharp interest rate cut by the
MPC. In Q4 2023, WIG surged on the results of the parliamentary elections.
Net fee and commission income from distribution and asset management grew by 19.2% YoY on account of higher income from management
and success fees collected by funds managed by Santander TFI S.A. The increase in income from management fees is attributed to higher value
of net average assets resulting from strong net sales and a positive change in the value of investment fund units. The accompanying margin
decrease was driven by changes in the asset structure (higher share of low-margin short-term debt sub-funds compared to the last year). At
the same time, growth was reported in income from success fees, which exceeded market benchmarks for individual sub-funds. In particular,
high rates of return were generated by equity, mixed and treasury sub-funds.
A decrease of 7.7% YoY in net fee and commission income from account maintenance and cash transactions reflected price concessions for
corporate customers with regard to liquidity management and preferential terms for customers from Ukraine such as free-of-charge current
accounts. The base of current and personal accounts operated by the Bank has been growing steadily since 2022, including an increase in the
number of Santander Accounts (former Accounts As I Want It or Accounts Worth Recommending). These changes translate into a higher volume
of transactions with debit cards and an increased use of electronic services and payments.
Net fee and commission income from issuance and management of a combined portfolio of credit cards of Santander Bank Polska S.A. and
Santander Consumer Bank S.A. decreased by 2.5% YoY, which is attributed to the credit card portfolio of the latter bank. In 2023, non-active
cards were terminated and the cash turnover declined (-14.0% YoY). On the other hand, the non-cash turnover increased (+7.2% YoY) as did the
use of credit card transfers offered by Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
93
Non-interest and non-fee income
126,8
217,7
10,6
-23,1
-169,2
306,6
168,9
11,5
-5,1
-322,5
+141,8%
YoY
-22,4%
YoY
+
8,5%
YoY
+1 8,0
PLNm
-153,3
PLNm
Net Trading Income & Revaluation Other Operating Income Dividend Inco me Gaines/Losses on Other Financial
Instr uments
Gain/loss on Derecognition of
Financial Liabilities Measured at
Amortised cost
Components of consolidated other income for 2022 vs 2023
2022
2023
PLN m
Non-interest and non-fee income of Santander Bank Polska Group presented above totalled PLN 159.4m and was up 2.1% YoY on account of changes in
the following components:
Net trading income and revaluation grew by 141.8% YoY to PLN 306.6m as a result of a higher gain of PLN 221.4m on transactions in derivative
and interbank FX markets (PLN 92.7m in 2022). An increase was also reported in the valuation of the credit card portfolio measured at fair
value through profit or loss, reflected in a positive fair value adjustment of PLN 10.7m (PLN 3.2m in the comparative period). Total gain on
trading in equity and debt financial assets measured at fair value through profit or loss was PLN 74.4m for 2023 vs PLN 30.8m for 2022.
Other operating income was PLN 168.9m and decreased by 22.4% YoY due to, among others, lower indemnity payments from insurers.
Dividend income totalled PLN 11.5m and was up 8.5% YoY on account of higher dividends from Krajowa Izba Rozliczeniowa S.A., Biuro
Informacji Kredytowej S.A. and Hortico S.A. (a company from the capital investment portfolio of Santander Inwestycje Sp. z o.o.).
Loss on other financial instruments decreased by PLN 18.0m YoY to PLN 5.1m as a combined effect of:
A profit of PLN 2.9m from the conversion of series A convertible preference shares of Visa Inc. to 68k ordinary shares sold in several
stages.
A positive change of PLN 13.1m in the valuation of Visa Inc. shares, including the amount of PLN 11.0m accumulated until the sale
of all 21,032 series C preference shares by Santander Bank Polska S.A. in September 2023 (indirectly convertible to approx. 76,430
series A ordinary shares) to limit fluctuations in the fair value of the portfolio caused by movements in share prices and foreign
exchange rates.
A lower loss of PLN 24.9m on hedged and hedging instruments (vs a loss of PLN 8.8m for 2022).
Loss of PLN 322.5m on derecognition of financial instruments measured at amortised cost (vs PLN 169.2m last year). This line item includes
mainly costs of voluntary settlements with CHF home loan borrowers, which totalled PLN 329.8m for 2023 vs PLN 183.3m for 2022. By 31
December 2023, 9,342 settlements were made (6,303 in 2023 alone), both pre-court and following the legal disputes. Settlement proposals
made by Santander Bank Polska S.A. take into account both the elements of conversion proposed by the KNF Chairman in 2020, and the
conditions defined internally by the Bank.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
94
Expected credit loss allowances
Net expected credit loss allowances on loans
and advances measured at amortised cost
(PLN m)
Stage 1 Stage 2 Stage 3 POCI Total Total
2023 2022 2023 2022 2023 2022 2023 2022 2023 2022
Allowance on loans and advances to banks
(0.3) (0.1)
-
-
-
-
-
-
(0.3) (0.1)
Allowance on loans and advances to
customers
(153.5) (120.6) (573.9) (503.9) (468.7) (427.7) 71.5
106.2
(1,124.6) (946.0)
Recoveries of loans previously written off
-
-
-
-
38.9
52.1
-
-
38.9 52.1
Allowance on off-balance sheet credit
liabilities
(9.4) 4.1
(37.6) (1.5) (16.4) (3.3)
-
-
(63.4) (0.7)
Total
(163.2) (116.6) (611.5) (505.4) (446.2) (378.9) 71.5
106.2
(1,149.4) (894.7)
In 2023, the charge made by Santander Bank Polska Group to the income statement on account of net expected credit loss allowances was PLN 1,149.4m
and increased by 28.5% YoY, reflecting the impact of the economic environment on the credit portfolio. This figure includes net allowances of Santander
Consumer Bank Group, which totalled PLN 172.7m and were up PLN 139.3m, as lower gain was generated on the sale of overdue receivables compared
to the last year, and there were no non-recurring items which would positively affect the income statement (such as the update of risk parameters with
a positive financial impact).
Net allowances on loans and advances to customers of Santander Bank Polska Group for 2023 are a combined effect of:
Moderate increase in the cost of credit risk related to personal and SME customers in H1 2023 as a result of deterioration in customers’ standing
and prospects due to geopolitical and macroeconomic developments, and its stabilisation or decrease in the majority of credit portfolios in H2
2023. Deterioration in the financial standing of selected corporate customers resulting in downgrade of their exposures to Stage 2 or 3. Risk
of downgrades to NPLs in the mortgage loan portfolio, partly mitigated by aid measures.
Periodical review of provision parameters (parameters of models and macroeconomic scenarios including forecasts) and management
adjustments, resulting in PLN 54.0m worth of top-ups.
Sale of credit receivables of Santander Bank Polska S.A. and Santander Consumer Bank S.A. totalling PLN 2,249.7m at a profit before tax of
PLN 238.8m (last year, credit receivables of PLN 1,689.7m were sold at a profit before tax of PLN 185.8m).
No non-recurring items at Santander Consumer Bank Group which would positively affect the income statement (such as the update of risk
parameters with a positive financial impact).
The cost of credit risk of Santander Bank Polska Group for 2023 was 0.72% (vs 0.59% last year), with a higher value of the credit portfolio measured at
amortised cost (+4.3% YoY including finance lease receivables).
The Group closely monitors its credit portfolio, and promptly responds to changes in risk by adjusting credit ratings and classifying exposures to individual
stages.
Total costs
Total costs (PLN m) 2023 2022 YoY change
Staff, general and administrative expenses, of which:
(3,934.8) (3,977.5) -1.1%
- Staff expenses (2,284.3) (1,815.8) 25.8%
- General and administrative expenses (1,650.5) (2,161.7) -23.6%
Depreciation/amortisation (569.5) (523.6) 8.8%
- Depreciation/amortisation of property, plant and equipment and intangible
assets
(424.6) (381.7) 11.2%
- Depreciation of the right-of-use asset (144.9) (141.9) 2.1%
Other operating expenses (210.7) (196.6) 7.2%
Total costs (4,715.0) (4,697.7) 0.4%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
95
After the four quarters of 2023, total operating expenses of Santander Bank Polska Group were relatively stable (+0.4% YoY) and totalled PLN 4,715.0m.
An increase in staff expenses resulting from the salary reviews was accompanied by a decrease in general and administrative expenses reflecting lower
contributions to the Bank Guarantee Fund and the Institutional Protection Scheme (IPS) and no contributions required to be made to the Borrowers
Support Fund. This is an effect of high contributions made by the largest banks last year both to the mechanism supporting home loan borrowers in
distress (PLN 173.6m) and to the IPS aid fund, with PLN 445.7m contributed by Santander Bank Polska S.A. On the other hand, the level of expenses was
negatively affected by indexation and revision of pricing due to an increasing inflation rate, among other things.
At the same time, growth was reported in other operating expenses and depreciation/amortisation of property, plant and equipment and intangible
assets, resulting from delivery of further investment projects and capitalisation of the related costs.
As total income grew by 29.2% YoY and total costs were relatively stable, the cost to income ratio was 29.5% in 2023 vs 37.9% in 2022.
Staff expenses
Staff expenses totalled PLN 2,284.3m in 2023 and increased by 25.8% YoY. The average employment in the Group was broadly stable compared to the
last year. The main components of staff expenses, i.e. salaries, bonuses and statutory deductions from salaries, went up by 23.6% YoY to PLN 2,206.3m
on account of the salary reviews in line with market rates conducted in September 2022 and in 2023 and the costs of PLN 126.8m related to the launch
of the long-term share-based incentive plan (Incentive Plan VII). In the reporting period, higher charges were made in relation to reimbursement of
remote work costs, team bonuses, accruals for unused annual leaves, organisation of internal meetings and recruitment.
General and administrative expenses
General and administrative expenses of Santander Bank Polska Group for 2023 decreased by 23.6% YoY to PLN 1,650.5m, as a high base effect connected
with the contribution of PLN 445.7m made by the Bank to the IPS aid fund last year (vs PLN 0.3m in the current reporting period) and the contribution of
PLN 173.6m to the Borrowers Support Fund made by the Group (with no corresponding contribution made in 2023). Furthermore, fees payable to market
regulators (BFG, KNF and KDPW) declined by 29.2% YoY to PLN 211.4m. This included a decrease of 34.0% YoY to PLN 174.6m in the charge made to the
Group’s income statement on account of contributions to the Bank Guarantee Fund. It resulted from the BFG Council’s decision to waive contributions to
the bank guarantee fund in 2023, as the target level of deposit guarantee funds had already been exceeded. At the same time, the annual contribution
to the bank resolution fund was reduced.
Excluding the mandatory contributions payable to the Bank Guarantee Fund and the Borrowers Support Fund as well as contributions made as part of
the voluntary participation in the IPS, the Group’s general and administrative expenses increased by 15.5% YoY, mainly on account of higher cost of IT
system usage and marketing as well as the cost of third party services, maintenance of premises, and data transmission.
The cost of IT system usage, the largest item of the Group’s general and administrative expenses, went up by 20.9% YoY in connection with delivery of
multiple IT projects (business, regulatory and optimisation ones) across Santander Group and locally and due to processes related to support and
maintenance of the existing infrastructure. The increase in marketing and entertainment costs (+12.4% YoY) results from the launch of a series of
advertising campaigns (promoting SME and leasing products, Max Savings Account, Account for the Young, cash loan, etc.) and higher cost of sponsorship
and entertainment (“Letnie Brzmienia” summer music festival, “Impact’23”). The costs of third party services were also up (+35.4% YoY) on account of
an increase in back office service rates and remuneration payable to temporary staff, as well as the launch of new external services as part of banking
operations. Higher cost of maintenance of premises (+14.4% YoY) is attributed to higher prices of energy, heating and other service charges as well as
rent indexation. Cost of data transmission increased by 68.1% YoY along with cost of cloud computing services.
At the same time, the Group reported a decrease in security costs (-19.7% YoY), consulting and advisory fees (-11.2% YoY), car fleet and cash in transit (-
5.8% YoY).
Tax and other charges
Tax on financial institutions for 2023 totalled PLN 782.5m and was stable compared to 2022, reflecting a YoY increase in assets with a YoY rise in the
portfolio of tax-exempt treasury securities and a new tax exemption on securities which are statutorily guaranteed by the State Treasury.
Corporate income tax was PLN 1,902.2m and effectively lower compared to the previous year (the effective tax rate fell from 30.9% for 2022 to 27.8%
for 2023), mainly on account of an increase in profit before tax combined with higher cost of legal risk related to foreign currency mortgage loans, lower
contributions to the Bank Guarantee Fund and no payments required to be made to the Borrowers Support Fund.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
96
2. Consolidated statement of financial position
Consolidated assets
As at 31 December 2023, the total assets of Santander Bank Polska Group were PLN 276,651.9m, and increased by 7.4% YoY mainly on account of loans
and advances to customers, investment financial assets and financial assets held for trading. The value and structure of the Group’s financial position is
determined by the parent entity, which held 91.2% of the consolidated total assets vs 91.8% as at the end of December 2022.
243 017,3
245
938,5
244 607,7
261 520,8
257 517,2
257 290,1
262 684,3
277 154,4
276 651,9
31-Dec-21 31-Mar-22 30-Jun-22 30-Sep-22 31-Dec-22 31-Mar-23 30-Jun-23 30-Sep-23 31-Dec-23
Total consolidated assets at the end of consecutive quarters in 2022 and 2023
1)
PLN m
209 476,2
228 748,9
243 017,3
257 517,2
276 651,9
31-Dec-2019 31-Dec-2020 31-Dec-2021 31-Dec-2022 31-Dec-2023
Total assets at the end of years 2019-2023
1)
PLN m
+7,4%
YoY
1)
The total assets for individual quarters of 2022 and 2023 were restated due to the implementation of the KNF’s recommendation
to reverse the effects
of the reclassification of debt securities measured at fair value through other comprehensive income made i
n 2022. For more information, see the table
below: “Structure of consolidated assets”.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
97
Structure of consolidated assets
Assets
1)
in PLN m
(for analytical purposes)
31.12.2023
Structure
31.12.2023 31.12.2022
Structure
31.12.2022 Change
1
2
3
4
1/3
Loans and advances to customers 159,520.0 57.7% 152,508.7
59.2% 4.6%
Investment financial assets
67,523.0 24.4% 53,334.1
20.7% 26.6%
Buy-sell-back transactions and assets
pledged as collateral
12,948.5 4.7% 16,142.8
6.3% -19.8%
Financial assets held for trading and
hedging derivatives
10,514.4 3.8% 7,432.8
2.9% 41.5%
Loans and advances to banks 9,533.9 3.4% 9,577.5
3.7% -0.5%
Cash and balances with central banks 8,417.5 3.0% 10,170.0
4.0% -17.2%
Property, plant and equipment,
intangible assets, goodwill and right-of-
use assets
3,853.5 1.4% 3,638.4
1.4% 5.9%
Other assets
2)
4,341.1
1.6%
4,712.9
1.8%
-7.9%
Total
276,651.9
100.0%
257,517.2
100.0%
7.4%
In the above condensed statement of financial position as at 31 December 2023, net loans and advances to customers were the key item of the
consolidated assets (57.7%). They totalled PLN 159,520.0m and increased by 4.6% compared to the end of December 2022 on account of a rise in loans
for enterprises and the public sector, lease receivables, and loans and advances to individuals.
Investment financial assets were the second largest item. They went up by 26.6% YoY as a result of the purchase of treasury bonds (allocated to the
portfolio of debt investment financial assets measured at amortised cost) as well as NBP bills (allocated to the portfolio of debt investment financial
assets measured at fair value through other comprehensive income).
As part of ongoing liquidity management, the level of financial assets held for trading and hedging derivatives increased significantly in the analysed
period (+41.5% YoY), mainly on account of the trading portfolio of treasury bonds and FX derivatives.
At the same time, the Group’s activity in the interbank repo market decelerated, as reflected in assets under buy-sell-back transactions and assets pledged
as collateral, which declined by 19.8% YoY. Cash and balances with central banks went down by 17.9% YoY due lower balances of current accounts with
central banks.
Credit portfolio
31.12.2023 31.12.2022 Change
Gross loans and advances to customers in PLN m
1 2 1/2
Loans and advances to individuals 83,052.5 81,483.3 1.9%
Loans and advances to enterprises and the public sector 68,666.2 64,833.2 5.9%
Finance lease receivables
13,418.7
11,998.3
11.8%
Other
74.5
77.9
-4.4%
Total
165,211.9
158,392.7
4.3%
1)
Pursuant to the KNF’s recommendation, in Q4 2023 Santander Bank Polska S.A. retrospectively reversed the effects of the reclassification of financial assets made in 2022 and classified again the portfolio of
selected bonds as financial assets measured at fair value through other comprehensive income. The reversal of the reclassification resulted in a decrease of PLN 12,343.3m in debt investment financial assets
measured at amortised cost as at 31 December 2022 and an increase of PLN 10,306.3m in debt investment financial assets measured at fair value through other comprehensive income. At the same time, deferred
tax assets of PLN 387.0m were recognised. The total impact on the statement of financial position was negative at PLN 1,650m.
2)
Other assets include the following items of the full version of financial statements: investments in associates, current tax assets, net deferred tax assets, assets classified as held for sale and other assets.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
98
Loans to
Enterprises &
Public Sector
42%
Home
Mortgages
32%
Cash Loans
14%
Other Loans to
Individuals
4%
Finance Lease
Receivables
8%
Product structure of consolidated
loans and advances to customers as at 31.12.2023
PLN
83%
EUR
15%
CHF
1%
USD & Other
1%
FX structure of consolidated
loans and advances to customers as at 31.12.2023
As at 31 December 2023, consolidated gross loans and advances to customers were PLN 165,211.9m and increased by 4.3% YoY. The portfolio includes
loans and advances to customers measured at amortised cost of PLN 148,817.8m (+3.7% YoY), loans and advances to customers measured at fair value
through other comprehensive income of PLN 2,890.2m (+9.7% YoY), loans and advances to customers measured at fair value through profit or loss of
PLN 85.1m (-64.5% YoY), and finance lease receivables of PLN 13,418.7m described below.
The section below presents the Group’s credit exposures by key portfolios in terms of customer segments and products:
Loans and advances to individuals increased by 1.9% YoY to PLN 83,052.5m as at the end of December 2023. Home loans, which were the
main contributor to this figure, totalled PLN 53,014.1m and declined by 0.3% YoY as a result of a decrease in the foreign currency mortgage
loan portfolio, a slowdown in the mortgage loan market in H1 2023, and an increase in an adjustment to gross carrying amount in respect of
legal risk connected with foreign currency mortgage loans. Cash loans were the second largest item and totalled PLN 22,798.8m (+8.4% YoY)
supported by growth in sales.
Loans and advances to enterprises and the public sector (including factoring receivables) went up by 5.9% YoY to PLN 68,666.2m on account
of higher exposures in respect of factoring and term loans, including loans for investment purposes in the Corporate and Investment Banking
segment.
Finance lease receivables of the subsidiaries of Santander Bank Polska S.A. rose by 11.8% YoY to PLN 13,418.7m, supported by 16.8% YoY
growth in sales of leased assets, particularly in the vehicles segment.
4,8%
4,7%
4,9%
5,0%
4,8%
4,9% 4,9%
4,6%
61,1%
60,6%
59,9%
57,5%
58,0% 58,0%
59,1%
55,4%
40%
45%
50%
55%
60%
65%
4,5%
5,0%
5,5%
6,0%
31-Mar-2022 30-Jun-2022 30-Sep-2022 31-Dec-2022 31-Mar-2023 30-Jun-2023 30-Sep-2023 31-Dec-2023
Credit quality ratios by quarter in 2022and 2023
NPL ratio Loan loss coverage ratio
As at 31 December 2023, the NPL ratio was 4.6% and the provision coverage ratio for impaired loans was 55.4% (vs 5.0% and 57.5% for 2022,
respectively).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
99
Structure of consolidated equity and liabilities
Equity and liabilities
1)
in PLN m
(for analytical purposes)
31.12.2023
Structure
31.12.2023 31.12.2022
Structure
31.12.2022 Change
1
2
3
4
1/3
Deposits from customers 209,277.4 75.6% 196,496.8 76.3% 6.5%
Subordinated liabilities and debt securities in issue
11,933.5
4.3%
12,137.7
4.7%
-1.7%
Financial liabilities held for trading and hedging derivatives 9,699.0 3.5% 9,087.9 3.5% 6.7%
Deposits from banks and sell-buy-back transactions 4,430.0 1.6% 6,356.2 2.5% -30.3%
Other liabilities
2)
7,621.0 2.8% 4,973.3 1.9% 53.2%
Total equity 33,691.0 12.2% 28,465.3 11.1% 18.4%
Total
276,651.9
100.0%
257,517.2
100.0%
7.4%
As at 31 December 2023, deposits from customers totalled PLN 209,277.4m and were the largest constituent item of the Group’s total equity and
liabilities (75.6%) disclosed in its consolidated statement of financial position and the main source of funding for the Group’s assets. They were up 6.5%
YoY as a result of a steady inflow of funds to term deposits, which further increased their share in the deposit structure at the expense of current account
balances.
Financial liabilities held for trading and hedging derivatives grew by 6.7% YoY, mainly on account of liabilities in respect of FX transactions and short sale.
A decrease was reported in other key categories of consolidated liabilities, notably in deposits from banks and sell-buy-back transactions, which went
down by 30.3%, reflecting the Group’s decelerated activity in the repo market.
Subordinated liabilities and liabilities in respect of debt securities in issue decreased by 1.7% vs 31 December 2022, with the latter item falling by 0.9%
YoY to PLN 9,247.2m, as a combined effect of the issue of debt instruments with a total nominal value of PLN 6,875.8m and redemption of PLN 6,721.7m
worth of securities on their maturity dates.
During the reporting period, the following issues were made:
On 15 February 2023, Santander Factoring Sp. z o.o. issued PLN 160m worth of series P bonds with an interest rate of 1M WIBOR plus margin and
a maturity date of 15 August 2023. On 16 August 2023, the company issued PLN 300m worth of series Q bonds with an interest rate based on 1M
WIBOR and a maturity date of 16 February 2024. Both issues were guaranteed by Santander Bank Polska S.A.
On 30 March 2023, Santander Bank Polska S.A. issued PLN 1.9bn worth of series 1/2023 senior non-preferred bonds as part of the programme for
issuing bonds up to PLN 5bn. The bonds bear an interest rate of 6M WIBOR plus 1.90% and will be redeemed on 31 March 2025 subject to the
Bank’s right to exercise a call option. The instruments were issued for sustainability purposes. On 29 November 2023, series 2/2023 senior preferred
bonds were issued as part of the issue programme, with a nominal value of PLN 3.1bn, interest rate of 6M WIBOR plus 1.80% and a maturity date
of 30 November 2026 with a call option. On 22 December 2023, the Bank issued fixed-coupon senior non-preferred notes under the EMTN
Programme with a nominal value of EUR 200m and a maturity date of 22 December 2025. They were taken up in full by Banco Santander S.A.
On 26 May 2023, Santander Consumer Multirent Sp. z o.o. issued a tranche of PLN 50m worth of mid-term (2-year) bonds as part of the debt
securities issue programme delivered together with Santander Consumer Bank S.A.
On 23 June 2023, Santander Leasing S.A. issued PLN 200m worth of 1-year series M bonds with a put option and an interest rate based on 3M
WIBOR. On 14 July 2023 and 19 December 2023, the company issued PLN 200m and PLN 100m worth of series N and O bonds of the same type,
with maturity dates of 15 July 2024 and 19 December 2024, respectively. The bond issues were guaranteed by Santander Bank Polska S.A.
The majority of proceeds from the bond issues are earmarked for general corporate purposes of the issuers, except for the issue made by Santander Bank
Polska S.A., whose purpose was to raise capital for financing sustainable investments.
1)
Pursuant to the KNF’s recommendation, in Q4 2023 Santander Bank Polska S.A. retrospectively reversed the effects of the reclassification of financial assets made in 2022 and classified again the portfolio of
selected bonds as financial assets measured at fair value through other comprehensive income. The reversal of the reclassification resulted in a decrease of PLN 1,650m in the revaluation reserve.
2)
Other liabilities include lease liabilities, current tax liabilities, deferred tax liabilities, provisions for financial and guarantee liabilities, other provisions and other liabilities.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
100
Deposit base
Deposits by entities
31.12.2023 31.12.2022 Change
Deposits from customers in PLN m
1 2 1/2
Deposits from individuals
115,261.2
107,927.3
6.8%
Deposits from enterprises and the public sector
94,016.2
88,569.5
6.1%
Total
209,277.4
196,496.8
6.5%
As at 31 December 2023, consolidated deposits from customers totalled PLN 209,277.4m and increased by 6.5% YoY as an effect of high base comprising
funds received by customers under state aid programmes during the pandemic and an inflow of funds since the end of 2022 accumulated by business
customers for future investments.
The retail deposit base totalled PLN 115,261.2m, up 6.8% YoY. Customers preferred term deposits which offered interest rates better adjusted
to the high interest rate environment. As a result, their balance increased by 20.1% YoY to PLN 41,847.9m, whereas the total balance of savings
and current accounts grew by 0.5% YoY to PLN 73,159.7m with decreasing balances of savings accounts (-12.1% YoY). Personal customers
also invested their liquidity surpluses in investment funds managed by Santander TFI S.A., which reported strong performance and a positive
balance of contributions and redemptions in 2023.
Deposits from enterprises and the public sector increased by 6.1% YoY to PLN 94,016.2m as a consequence of a rise of 4.0% YoY in term
deposits to PLN 22,468.8m and growth of 7.4% YoY in current account balances to PLN 67,532.0m.
Deposits by tenors
Term Deposits
31%
Current Accounts
67%
Other Liabilities
2%
Structure of consolidated customer deposits as at 31.12.2023
Term Deposits
29%
Current Accounts
69%
Other Liabilities
2%
Structure of consolidated customer deposits as at
31.12.2022
The Group’s total term deposits from customers amounted to PLN 64,316.7m, up 13.9% YoY. Current account balances rose by 3.7% YoY to PLN
140,691.7m, and other liabilities were PLN 4,269.0m, down 1.6% YoY.
Loans and advances from financial institutions (PLN 950.4m vs PLN 1,316.7m as at 31 December 2022) were one of the main components of other
liabilities and were disclosed under deposits from enterprises, which included loans granted by international financial organisations (the European
Investment Bank/ EIB, the European Bank for Reconstruction and Development/ EBRD and the Council of Europe Development Bank/ CEB) to finance the
lending activity of the Bank and its subsidiaries. The YoY decrease in the above line item is the result of scheduled repayments.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
101
29,2
33,3
44,5
56,4
59,3
61,8
70,5
64,3
153,9
145,4
139,9
135,7
134,2
135,1
135,0
140,7
4,2
4,8
5,1
4,3
3,7
3,8
4,5
4,3
31-Mar-2022 30-Jun-2022 30-Sep-2022 31-Dec-2022 31-Mar-2023 30-Jun-2023 30-Sep-2023 31-Dec-2023
Term deposits and current accounts * at quarter-ends of 2022 and 2023
Term Deposits
Current Accounts Other Liabilities
PLN bn
∗ Including savings accounts
3. Selected financial ratios of Santander Bank Polska Group
Selected financial ratios of Santander Bank Polska Group
31.12.2023 31.12.2022
Cost/Income
29.5%
37.9%
Net interest income/Total income
82.0%
78.0%
Net interest margin
1)
5.39%
4.31%
Net fee and commission income/Total income
17.0%
20.7%
Net loans and advances to customers/Deposits from customers
76.2%
77.6%
NPL ratio
2)
4.6%
5.0%
NPL provision coverage ratio
3)
55.4%
57.5%
Cost of credit risk
4)
0.72% 0.59%
ROE
5)
20.3% 11.9%
ROTE
6)
21.2%
12.1%
ROA
7)
1.8%
1.1%
Total capital ratio
8)
18.56%
19.74%
Tier 1 capital ratio
9)
17.18%
18.02%
Book value per share (PLN)
329.69
278.56
Earnings per ordinary share (PLN)
10)
47.28 27.39
1)
Net interest income annualised on a year-to-date basis (excluding interest income from the portfolio of debt securities held for trading and other exposures related to trading) to average net earning assets as
at the end of consecutive quarters after the end of the year preceding the particular accounting year (excluding financial assets held for trading, hedging derivatives, other exposures related to trading and other
loans and advances to customers).
2)
Lease receivables and gross loans and advances to customers measured at amortised cost and classified to Stage 3 and POCI exposures to the total gross portfolio of such lease receivables and loans and
advances as at the end of the reporting period.
3)
Impairment allowances for lease receivables and loans and advances to customers measured at amortised cost and classified to Stage 3 and POCI exposures to the gross value of such lease receivables and
loans and advances as at the end of the reporting period.
4)
Net expected credit loss allowances (for four consecutive quarters) to average gross loans and advances to customers measured at amortised cost and lease receivables (as at the end of the current reporting
period and the end of the previous year).
5)
Profit attributable to the parent’s shareholders (for four consecutive quarters) to average equity (as at the end of the current reporting period and the end of the previous year), excluding non-controlling
interests, current period profit and dividend reserve.
6)
Profit attributable to the parent’s shareholders (for four consecutive quarters) to average tangible equity (as at the end of the current reporting period and the end of the previous year) defined as common
equity attributable to the parent’s shareholders less revaluation reserve, current year profit, dividend reserve, intangible assets and goodwill.
7)
Profit attributable to the parent’s shareholders (for four consecutive quarters) to average total assets (as at the end of the current reporting period and the end of the previous year).
8)
The capital ratio was calculated on the basis of own funds and total capital requirements established for the individual risk types by means of the standardised approach, in line with the CRD IV/CRR package.
The comparative period includes profits allocated to own funds pursuant to applicable EBA guidelines.
9)
Tier 1 capital ratio calculated as a quotient of Tier 1 capital and risk-weighted assets for credit, market and operational risk. The comparative period includes profits allocated to own funds pursuant to applicable
EBA guidelines.
10)
Profit for the period attributable to the parent’s shareholders to the average weighted number of ordinary shares.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
102
4. Separate income statement
Condensed separate income statement
of Santander Bank Polska S.A. (PLN m)
(for analytical purposes)
2023
2022
Restated data
3)
YoY change
Total income
14,111.2
10,486.1
34.6%
- Net interest income
11,439.6
8,040.5
42.3%
- Net fee and commission income
2,385.8
2,277.9
4.7%
- Other income
1)
285.8
167.6
70.6%
Total costs
(3,936.5)
(3,908.5)
0.7%
- Staff, general and administrative expenses
(3,309.0) (3,378.7) -2.1%
- Depreciation/amortisation
2)
(477.5) (446.9) 6.8%
- Other operating expenses
(150.0) (83.0) 80.8%
Net expected credit loss allowances
(945.7)
(798.6)
18.4%
Cost of legal risk connected with foreign currency mortgage loans
3)
(2,081.6)
(1,428.3)
45.7%
Tax on financial institutions
(751.2) (752.3) -0.2%
Profit before tax
6,396.3
3,598.3
77.8%
Corporate income tax
(1,723.3)
(1,149.2)
50.0%
Net profit for the period
4,673.0 2,449.0 90.8%
In 2023, the profit before tax of Santander Bank Polska S.A. increased by 77.8% YoY to PLN 6,396.3m, and the net profit for the period grew by 90.8%
YoY to PLN 4,673.0m.
The table presented in the “Comparability of periods” section below contains the selected items of the income statement of Santander Bank
Polska S.A. which affect the comparability of the analysed periods. After the relevant adjustments:
the Bank’s underlying profit before tax went up by 18.4% YoY and
the underlying net profit for the period increased by 18.9% YoY.
1)
Other income includes total non-interest and non-fee income of the Bank comprising the following items of the full income statement: dividend income, net trading income and revaluation, gain/ loss on other financial
instruments, gain/ loss on derecognition of financial instruments measured at amortised cost and other operating income.
2)
Depreciation/amortisation includes depreciation of property, plant and equipment, amortisation of intangible assets and depreciation of the right-of-use asset.
3)
In Q4 2023, the comparative data were restated in line with the KNF’s recommendation to reverse the effects of the reclassification of PLN 10,521.7m worth of debt securities measured at fair value through other
comprehensive income made in 2022 to debt inv
estment financial assets measured at amortised cost totalling PLN 12,380.2m. The reversal of reclassification had the followi
ng impact on the income statement:
interest income on financial assets measured at amortised cost was reduced by PLN 154.1m and int
erest income on assets measured
at fair value through other comprehensive income was increased by that amount.
The event is neutral in terms of the net profit.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
103
Comparability of periods
Selected items of the separate income
statement affecting the comparability
of periods
2023 2022
Cost of legal risk connected with foreign
currency mortgage loans
(income statement item)
PLN 2,081.6m PLN 1,428.3m
Cost of settlements connected with foreign
currency mortgage loans
(gain/loss on derecognition of financial
instruments measured at amortised cost)
PLN 324.1m PLN 183.3m
Negative adjustment to interest income on
mortgage loans due to payment holidays
(interest income)
PLN 49.3m PLN 1,538.0m
Dividend income
(income statement item)
PLN 241.6m PLN 172.2m
Contributions to the Bank Guarantee Fund
(general and administrative expenses)
Contribution of PLN 159.0m to the bank
resolution fund
Contribution of PLN 245.1m to the
guarantee fund and to the bank
resolution fund
Costs related to the Institutional Protection
Scheme (IPS)
(general and administrative expenses)
PLN 0.3m PLN 445.7m
Costs related to the Borrowers Support
Fund
(general and administrative expenses)
No corresponding costs PLN 139.6m
Changes to the components of the profit before tax earned by the Bank are presented below.
3 399,0
188,7
107,9
69,6
69,4
7,5
1,1
0,3
- 30,6
- 67,0
- 147,1
- 147,5
- 653,2
Net Interest Income *
Net Trading Income & Revaluation
Net Fee & Commission Income
Staff, General and Administrative Expenses
Dividend Income
Gains/Losses on Other Financial Instruments
Tax on Financial Institutions
Other Operating Income
Depreciation/Amortisation
Other Operating Expenses
Impairment Allowances for Expected Credit Losses
Gain/Loss on Derecognition of Financial Instruments
Cost of Legal Risk Associated with Foreign Currency Mortgage Loans
Year-on-year changes in the main items of the income statement of Santander Bank Polska S.A.
for 2023 in absolute numbers
in PLN m
∗ The considerable YoY change in the net interest income of Santander Bank Polska S.A. is a low base effect arising from the negative adjustment of PLN 1,538.0m recognised in 2022 to account for
payment holidays for PLN mortgage loan borrowers (PLN 49.3m for 2023). On a comparative basis, the YoY change in the net interest income is PLN 1,910.3m.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
104
Changes in the main components of the standalone profit reflect the trends relating to the consolidated profit. Similarly to the Group, the Bank’s profit
before tax was positively affected by changes in: net interest income, net fee and commission income, net trading income and revaluation, gain on other
financial instruments, and general and administrative expenses. In addition, the Bank generated higher income on dividends from its subsidiaries. The
increase in the above-mentioned items was partly offset by a rise in: cost of legal risk and settlements connected with foreign currency mortgage loans,
staff expenses, other operating expenses, net expected credit loss allowances and amortisation/depreciation.
Structure of total income of Santander Bank Polska S.A.
Total income of Santander Bank Polska S.A. for 2023 increased by 34.6% YoY to PLN 14,111.2m. Excluding dividend income, impact of payment holidays
and costs of settlements with foreign currency mortgage loan borrowers, the underlying total income was up 18.3% YoY.
Net interest income
Interest income of Santander Bank Polska S.A. (PLN m) due to: 2023 2022
YoY change
Loans and advances to individuals
6,530.2
3,893.9
67.7%
Loans and advances to enterprises and the public sector, and lease receivables
5,221.7
3,729.2
40.0%
Debt securities and receivables under buy-sell-back transactions
3,103.3
2,134.2
45.4%
IRS and loans and advances to banks
748.7
432.6
73.1%
Total
15,604.0
10,190.0
53.1%
Interest expense of Santander Bank Polska S.A. (PLN m) due to: 2023 2022
YoY change
Deposits from individuals
(1,783.1)
(640.7)
178.3%
Deposits from enterprises and the public sector, and lease liabilities (1,705.9) (918.3) 85.8%
Liabilities under sell-buy-back transactions
(230.3)
(310.8)
-25.9%
Subordinated liabilities and debt securities in issue (348.0) (204.2) 70.4%
IRS and deposits from banks
(97.0)
(75.5)
28.6%
Total
(4,164.4)
(2,149.4)
93.7%
Net interest income
11,439.6
8,040.5
42.3%
The Bank’s interest income went up by 53.1% YoY, and interest expenses grew by 93.7% YoY. The dynamic growth in interest expenses reflects a rise in
term deposit balances and increasing competition in the deposit market following the series of NBP rate hikes until September 2022, which translated
into a rise in deposit interest rates in the reporting period as part of management of product offer parameters by Santander Bank Polska S.A.
In 2023, the Bank’s net interest income grew by 42.3% YoY to PLN 11,439.6m, and the cumulative net interest margin increased from 3.92% in 2022 to
5.21% in 2023.
The above line items were particularly supported by:
Continuously high interest rates throughout the period. In September and October 2023, the first interest rate cuts of 1 p.p. were made since 2020,
marking the start of the monetary policy easing cycle.
Low base resulting from the negative adjustment of PLN 1,538.0m due to payment holidays recognised in the comparative period, accounting for
the entire term of the solution.
Satisfactory growth of the Bank’s main credit portfolios.
On the other hand, the net interest income and margin were negatively affected by higher cost of funding and change of the deposit structure in favour of
term deposits.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
105
Net fee and commission income
Net fee and commission income of Santander Bank Polska S.A. (PLN m) 2023 2022
YoY change
FX fees
761.2
730.4
4.2%
Account maintenance and cash transactions
1)
368.6 399.2 -7.6%
Credit fees
2)
326.0 327.9 -0.6%
Debit cards
315.9
283.0
11.6%
Electronic and payment services
3)
203.5
194.2
4.8%
Brokerage activities 126.3 115.4 9.4%
Insurance fees
121.9
91.2
33.7%
Credit cards
81.5
80.8
0.9%
Guaranties and sureties
99.1
78.6
26.1%
Distribution fees 69.6 58.8 18.4%
Other fees
4)
-87.9
(81.6)
7.7%
Total
2,385.8
2,277.9
4.7%
1) Fee and commission income from account maintenance and cash transactions was reduced by the corresponding expenses disclosed under “Other” in Note 6 to the Financial Statements of Santander Bank
Polska S.A. for 2023 (PLN 20.8m in 2023 and PLN 20.8m in 2022).
2)
Net fee and commission income from lending, factoring and lease activities which is not amortised to net interest income. This line item includes inter alia the cost of credit agency.
3)
Fees for payments (foreign and mass payments, Western Union transfers), trade finance, debit cards, services for third party institutions as well as other electronic and telecommunications services.
4) Issue arrangement fees and other fees.
Net fee and commission income for 2023 totalled PLN 2,385.8m and increased by 4.7% YoY on account of higher net income from the key product lines,
including insurance (+33.7% YoY), guarantees and sureties (+26.1% YoY), distribution (+18.6% YoY), debit cards (+11.6% YoY) and brokerage services
(+9.4% YoY). Moderate growth was also reported in FX fees (+4.2% YoY), fees on electronic and payment services (+4.8% YoY) and credit cards (+0.9%
YoY).
On the other hand, despite a moderately higher volume of accounts, a decrease was reported in account maintenance fees because of the management
of fee and charge schemes and promotional and preference terms offered to customers.
Other income
Structure of non-interest and non-fee income of Santander Bank Polska S.A.
172,2
109,9
74,6
-19,8
-169,2
241,6
298,6
74,8
-12,4
-316,8
+40,3%
YoY
+171,6%
YoY
+0,4%
YoY
+ 7,5
PLN m
-147,6
PLN m
Dividend Income Net Trading Income &
Revaluation
Other Operating Income Gains on Other Financial
Instruments
Gain/loss on derecognition of
financial instruments
measured at amortised cost
Components of other income for 2022 vs. 2023
2022 2023
PLN m
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
106
The Bank’s other income (non-interest and non-fee income) presented in the figure above increased by 70.5% YoY to PLN 285.8m as a result of changes
to the following components:
An increase of 40.3% YoY in dividend income to PLN 241.6m, mainly on account of dividends paid in 2023 by Santander Finanse Sp. z o.o. (PLN
80.0m) and Santander Inwestycje Sp. z o.o. (PLN 35.1m) (in 2022, the companies did not pay out dividends).
A rise of 171.6% YoY in net trading income and revaluation to PLN 298.6m reflecting higher total gain on derivatives and interbank FX transactions
(PLN 210.6m in 2023 vs PLN 72.3m in 2022). Gain on the sale of debt financial assets measured at fair value through profit and loss also increased
considerably by PLN 31.5m YoY.
A lower loss of PLN 12.4m on transactions in other financial instruments (down PLN 7.5m).
Broadly stable level of other operating income YoY totalling PLN 74.6m.
A loss of PLN 316.8m on derecognition of financial instruments measured at amortised cost (PLN 169.2m in 2022), of which the amount of -PLN
324.1m related to settlements with customers.
Expected credit loss allowances
Net expected credit loss allowances on
loans and advances measured at
amortised cost (PLN m)
Stage 1 Stage 2 Stage 3 POCI Total Total
2023 2022 2023 2022 2023 2022 2023 2022 2023 2022
Allowance on loans and advances to
customers
(126.6) (146.3) (297.1) (259.6) (511.7) (449.4) 64.1
61.4
(871.4) (793.8)
Recoveries of loans previously written
off
-
-
-
-
5.2
(4.2)
-
-
5.2
(4.2)
Allowance on off-balance sheet credit
liabilities
(9.6) 3.9
(40.0) (1.0) (29.8) (3.4)
-
-
(79.5) (0.5)
Total (136.2) (142.3) (337.1) (260.6) (536.4) (457.1) 64.1
61.4
(945.7) (798.6)
Net expected credit loss allowances totalled PLN 945.7m in 2023 and went up by 18.4% YoY, reflecting deterioration of the economic environment
(economic slowdown, high inflation, lower consumer demand, higher geopolitical risk) and worsening situation of borrowers.
Staff, general and administrative expenses of Santander Bank Polska S.A.
Total costs of Santander Bank Polska S.A. (PLN m) 2023 2022 YoY change
Staff, general and administrative expenses, of which:
(3,309.0)
(3,378.7)
-2.1%
- Staff expenses (1,922.6) (1,494.6) 28.6%
- General and administrative expenses
(1,386.4)
(1,884.1)
-26.4%
Depreciation/amortisation
(477.5)
(446.9)
6.8%
- Depreciation/amortisation of property, plant and equipment and intangible assets
(350.7)
(321.5)
9.1%
- Depreciation of the right-of-use asset
(126.8)
(125.4)
1.1%
Other operating expenses
(150.0)
(83.0)
80.8%
Total costs
(3,936.5)
(3,908.6)
0.7%
In 2023, operating expenses totalled PLN 3,936.5m and were broadly stable YoY (+0.7% YoY). An increase of 28.6% YoY in staff expenses resulting from
the salary reviews was offset by a decrease of 26.4% YoY in general and administrative expenses reflecting lower contributions to the Bank Guarantee
Fund and the Institutional Protection Scheme (IPS) and no contributions required to be made to the Borrowers Support Fund. This is an effect of high
contributions made by the largest banks last year both to the mechanism supporting home loan borrowers in distress and to the IPS aid fund.
As total income grew faster than operating expenses, the Bank’s cost to income ratio was 27.9% for 2023 vs 37,3% for 2022.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
107
5. Separate statement of financial position
Assets of Santander Bank Polska S.A. (PLN m)
(for analytical purposes)
31.12.2023
31.12.2022*
Restated data YoY change
Loans and advances to customers
140,903.1
134,842.8
4.5%
Investment financial assets
62,952.6
50,086.9
25.7%
Cash and balances with central banks
8,275.1
10,135.1
-18.4%
Financial assets held for trading and hedging derivatives
10,501.3
7,417.7
41.6%
Buy-sell-back transactions
12,676.6
13,824.6
-8.3%
Property, plant and equipment, right-of-use assets, intangible assets and
goodwill
3,340.7 3,249.1 2.8%
Loans and advances to banks
9,048.4
9,709.8
-6.8%
Investments in subsidiaries and associates
2,377.4
2,377.4
0.0%
Assets pledged as collateral
271.9
2,157.4
-87.4%
Other assets
2)
2,054.0
2,647.3
-22.4%
Total
252,401.2
236,448.1
6.7%
Equity and liabilities of Santander Bank Polska S.A. in PLN m
(for analytical purposes)
31.12.2023
31.12.2022*
Restated data
YoY change
Deposits from customers
195,365.9
185,655.3
5.2%
Subordinated liabilities and debt securities in issue
8,514.5
8,605.2
-1.1%
Financial liabilities held for trading and hedging derivatives 9,663.6
8,989.9
7.5%
Deposits from banks
2,668.3
2,245.1
18.8%
Sell-buy-back transactions 273.5
2,158.5
-87.3%
Other liabilities
3)
6,429.8
4,148.8
55.0%
Total equity
29,485.5
24,645.3
19.6%
Total
252,401.2
236,448.1
6.7%
1) Pursuant to the KNF’s recommendation, in Q4 2023 Santander Bank Polska S.A. retrospectively reversed the effects of the reclassification of financial assets made in 2022 and classified again the portfolio of
selected bonds as financial assets measured at fair value through other comprehensive income. The reversal of the reclassification resulted in a decrease of PLN 12,343.3m in debt investment financial assets
measured at amortised cost as at 31 December 2022 and an increase of PLN 10,306.3m in debt investment financial assets measured at fair value through other comprehensive income. At the same time, deferred
tax assets of PLN 387.0m were recognised. The total impact on the statement of financial position was negative at PLN 1,650m.
2) Other assets include the following items of the full version of the financial statements: current income tax assets; net deferred tax assets; property, plant and equipment classified as held for sale and other
assets.
3)
Other liabilities include leasing liabilities, current income tax liabilities, provisions for financial and guarantee liabilities, other provisions and other liabilities.
As at 31 December 2023, the total assets of Santander Bank Polska S.A. were PLN 252,401.2m, up 6.7% YoY.
Net loans and advances to customers were the key item accounting for 56.6% of the Bank’s assets. They totalled PLN 140,903.1m and increased by 4.5%
YoY due to acceleration of credit delivery to business customers.
Investment financial assets were the second largest item. They went up by 25.7% YoY in 2023 mainly as a result of the purchase of treasury bonds
(allocated to the portfolio of debt investment financial assets measured at amortised cost) and NBP bills (allocated to the portfolio of debt investment
financial assets measured at fair value through other comprehensive income).
Deposits from customers were the largest contributor to equity and liabilities and accounted for 77.4% of the balance sheet total. They rose by 5.2% YoY
to PLN 195,365.9m as a consequence of an increase in personal and business account balances.
As part of ongoing liquidity management, the level of financial assets held for trading and hedging derivatives increased significantly in the analysed
period (+7.5% YoY), mainly on account of the trading portfolio of treasury bonds and FX derivatives.
At the same time, the activity in the interbank repo market decelerated, as reflected by a decline of 87.4% YoY in assets under buy-sell-back transactions.
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Loans and advances to customers and deposits from customers
Gross loans and advances to customers
of Santander Bank Polska S.A.
31.12.2023 31.12.2022 YoY change
Loans and advances to individuals
70,583.1 68,673.6 2.8%
Loans and advances to enterprises and the public sector 74,177.3 70,106.9 5.8%
Other 67.1 69.7 -3.8%
Total 144,827.5 138,850.3 4.3%
Gross loans and advances to customers totalled PLN 144,827.5m and were up 4.3% YoY as a combined effect of:
an increase of 5.8% YoY in the portfolio of loans and advances to enterprises and the public sector to PLN 74.2bn, largely on account of term loans
in the Corporate and Investment Banking segment used, among other things, for investment purposes;
a rise of 2.8% YoY in the portfolio of loans and advances for individuals to PLN 70.6bn, as a combined effect of growing cash loan sales and higher
adjustment to gross carrying amount in respect of legal risk connected with foreign currency mortgage loans.
NPL ratio was 3.9% as at 31 December 2023 (4.2% as at the end of 2022), while the ratio of impairment allowances to average gross loans and advances
measured at amortised cost was 0.68% (0.61% the year before).
The provision coverage ratio for impaired loans was 51.6% compared with 53.4% as at 31 December 2022.
As at 31 December 2023, the total adjustment to the gross carrying amount and provisions for legal risk and legal provisions (for legal claims and a
collective portion) accounted for 85% of the gross value of the active CHF loan portfolio (before adjustment to the gross carrying amount in line with IFRS
9).
Deposits from customers of Santander Bank Polska S.A. 31.12.2023 31.12.2022 YoY change
Deposits from individuals
107,212.3 102,383.2 4.7%
Deposits from enterprises and the public sector 88,153.6 83,272.0 5.9%
Total 195,365.9 185,655.3 5.2%
Deposits from customers grew by 52% YoY to PLN 195,365.9m as a result of an increase of 4.7% YoY in personal deposits and a rise of 5.9% YoY in
deposits from enterprises and the public sector.
The growth in deposits from customers in 2023 was mainly supported by term deposit account balances of personal customers (up PLN 5,213.2m)
combined with a slight decrease in current account balances (down PLN 340.2m). The balances of current accounts held by business and public sector
entities grew dynamically too, reaching PLN 4,477.3m (up 7.1% YoY).
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6. Selected ratios of Santander Bank Polska S.A.
Selected financial ratios of Santander Bank Polska S.A.
2023 2022
Cost/Income
27.9%
37.3%
Net interest income/Total income
81.1%
76.7%
Net interest margin
1)
5.21%
3.92%
Net fee and commission income/Total income
16.9%
21.7%
Net loans and advances to customers/Deposits from customers 72.1% 72.6%
NPL ratio
2)
3.9%
4.2%
NPL provision coverage ratio
3)
51.6% 53.4%
Cost of credit risk
4)
0.68%
0.61%
ROE
5)
21.4% 10.8%
ROTE
6)
22.3%
11.0%
ROA
7)
1.9% 1.0%
Total capital ratio
8)
21.24%
22.32%
Tier 1 capital ratio
9)
19.62% 20.26%
Book value per share (PLN)
288.5
241.2
Earnings per ordinary share (PLN)
10)
45.73 23.97
The approach to calculation of the financial ratios of Santander Bank Polska S.A. presented and numbered in the above table is provided under the corresponding table with ratios of Santander Bank Polska Group
numbered in the same way.
7. Additional financial information about Santander Bank Polska S.A. and
Santander Bank Polska Group
Transactions with related parties
Transactions with related parties
Transactions between Santander Bank Polska S.A. and its related parties are banking operations carried out on an arm’s length basis as part of their
ordinary business and mainly involve loans, bank accounts, deposits, guarantees and leases.
As at 31 December 2023, the Bank’s total exposure in respect of loans granted to banking and non-banking subsidiaries (Santander Factoring Sp. z o.o.,
Santander Leasing S.A., Santander Consumer Multirent Sp. z o.o. and Santander Consumer Bank S.A.) was PLN 19,760.2m compared to PLN 17,507.0 m
as at 31 December 2022.
The deposits held with the Bank by its subsidiaries (including Santander Finanse Sp. z o.o., Santander Inwestycje Sp. z o.o., Santander TFI S.A., Santander
Factoring Sp. z o.o., Santander Leasing S.A., Santander F24 S.A., Santander Consumer Multirent Sp. z o.o., Santander Consumer Bank S.A., Santander
Consumer Financial Solutions Sp. z o.o.) totalled PLN 321.0m vs PLN 401.6m as at 31 December 2022.
Contingent liabilities were PLN 4,902.5m as at 31 December 2023 (PLN 5,000.7m as at 31 December 2022). Guarantees to subsidiaries amounted to
PLN 3,604.7m (PLN 3,281.0m as at 31 December 2022).
These intercompany items have been eliminated from the consolidated accounts.
Intercompany transactions with the parent entity
The Bank’s receivables from the parent entity (Banco Santander S.A.) were PLN 5,895.1m (PLN 6,202.3m as at 31 December 2022), while liabilities were
PLN 518.3m (PLN 594.4m as at 31 December 2022).
For more information about related party transactions see Note 53 to the Consolidated Financial Statements of Santander Bank Polska Group for 2023
and to the Condensed Interim Separate Financial Statements of Santander Bank Polska S.A. for the 6-month period ended 30 June 2023.
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Off-balance sheet items
Guarantees and derivatives
The tables below present contingent liabilities and nominal values of derivative transactions of Santander Bank Polska Group.
Contingent liabilities (granted) (PLN m)
31.12.2023
31.12.2022
Financial:
41,675.4
34,341.2
- credit lines
37,526.1
30,018.1
- credit cards
3,470.8
3,481.1
- import letters of credit
669.5
820.2
- term deposits with future start date
9.0
21.8
Guarantees
15,210.6
8,935.7
Provision for off-balance sheet liabilities
(123.1)
(61.9)
Total
56,762.9
43,215.0
Contingent liabilities (received) (PLN m) 31.12.2023 31.12.2022
Financial
504.6
364.7
Guarantees
59,202.8
55,950.7
Total
59,707.4
56,315.4
Nominal values of derivatives (PLN m)
31.12.2023 31.12.2022
Forward transactions (hedging)
57,294.1
40,987.0
Forward transactions (trading) 1,026,949.4 776,623.4
Spot transactions
7,321.8
1,659.0
Transactions in equity instruments
26.4
16.3
Total
1,091,591.7
819,285.7
Description of guarantees issued
Santander Bank Polska S.A. issues guarantees to secure obligations arising from customers’ operating activities. These are: payment guarantees,
performance bonds, warranty guarantees, bid bonds, loan repayment guarantees and customs guarantees. In justified cases, the Bank issues counter-
guarantees and standby letters of credit.
All guarantees are granted in accordance with the Polish Banking Law and the Polish Civil Code. Guarantees issued by the Bank to secure cross-border
transactions may be subject to applicable rules as agreed by the parties (e.g. Uniform Rules for Demand Guarantees) or to foreign law if a guarantee is
governed by such law.
The process and information required in the case of guarantees are similar to the lending process. The Bank adopts the same approach to credit risk here
as in the case of balance sheet exposures.
Pending court proceedings
The table below presents the amounts disputed in pending court proceedings with regard to claims made by or against the Bank or its subsidiaries as at
31 December 2023 and 31 December 2022.
Court proceedings with Santander Bank Polska Group as a party (PLN m) 31.12.2023 31.12.2022
Value of claims in lawsuits filed by the Group 1,842.1 1,384.9
Value of claims in lawsuits filed against the Group
1)
6,601.7 4,175.4
Receivables of the Group in arrangement or bankruptcy cases 84.1 74.3
Value of claims in all pending court proceedings
8,527.8
5,634.6
Value of claims in completed proceedings
635.4
254.5
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As at the end of 2023, there were 2,873 cases against Santander Bank Polska Group 1,403m as at 31 December 2022), where the claim value was high
(equal to or above PLN 500k). The total amount of provisions recognised in accordance with IAS 37 and the adjustment to gross carrying amount under
IFRS 9 related to such legal claims was PLN 1,258.6m (PLN 656.6m as at 31 December 2022).
17,859 lawsuits were filed against the Group over loans indexed to or denominated in CHF, with the disputed amount totalling PLN 6.2bn (vs 12,225
lawsuits with the disputed amount of PLN 3.6bn as at 31 December 2022). This included two class actions filed under the Class Action Act.
For more information on legal claims in respect of foreign currency mortgage loans, see Note 48 “Legal risk connected with foreign currency mortgage
loans” and Note 49 “Contingent liabilities” to the Consolidated Financial Statements of Santander Bank Polska Group for 2023.
Collateral
As at 31 December 2023, the value of collateral established on borrowers’ accounts and assets and leased assets in favour of Santander Bank Polska
Group was 138,622.5m, including PLN 106,764.5m in relation to Santander Bank Polska S.A. (PLN 128,546.0m as at 31 December 2022, including PLN
100,045.7m in relation to the Bank).
8. Factors affecting the financial performance in 2024
The following external developments may have a significant impact on the financial performance and activity of Santander Bank Polska Group in 2024:
Timing of the start of the cycle of interest rate cuts by major central banks. The market is currently pricing in a large scale of rate cuts in 2024
with the start of the cycle in March-April and there is a risk related to a later start and smaller scale of interest rate cuts.
Continued weakness in the euro area and thus relatively low foreign demand for Polish goods and services.
Elections in the USA that may change the country's approach to the conflict in Ukraine and its relations with Europe.
The war between Russia and Ukraine, impact of sanctions and international trade restrictions. Migration flows. Potential disruptions to the
supply of energy resources. Increased defence spending in Poland.
Possible escalation of conflict in the Middle East, with potential impact on prices of crude oil and natural gas and on global risk aversion.
Further path of inflation in Poland impacting the market pricing of NBP rate changes.
Further decisions of the MPC on interest rates.
Foreign currency loans: banks' decisions on settlements with customers and further litigation.
”Payment holidays” – possible extension of the deferral of PLN mortgage repayments at modified eligibility conditions.
Changes in the valuation of credit risk in financial markets, also influenced by changes in the assessment of geopolitical risk.
Changes in bond yields depending on monetary and fiscal policy expectations.
Changes in the demand for credit in the context of liquidity, still high interest rates, the impact of the war and quick rise of apartment prices in
Poland in recent quarters.
Changes in the financial situation of households influenced by labour market trends.
Changes in clients' savings allocation decisions influenced by expected returns on various asset classes and changes in attitudes towards
saving and spending.
Further developments in global equity markets and their impact on demand for mutual fund units and shares.
The likely unlocking of EU structural funds for Poland as well as payments from the National Recovery Plan during 2024.
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XII. Risk and capital management
1. Key risk management principles and structure in the Bank and in
Santander Bank Polska Group
Key risk management principles
Both the Bank and other members of Santander Bank Polska Group are exposed to various risks within their day-to-day activities which adversely affect
the delivery of strategic priorities of the organisation. The main types of risks include: credit risk (including concentration risk), market risk (in the banking
book and in the trading book), liquidity risk, operational risk, compliance risk and reputational risk.
Risk management allows Santander Bank Polska S.A. and its Group to conduct effective and safe operations that enable profit generation and business
development within approved risk parameters. The Bank follows a range of external standards and requirements in this respect which are binding on
financial institutions. It also relies on best practice and standards developed by Santander Group.
The Bank and Santander Bank Polska Group have defined their risk profile which corresponds to the general risk appetite established by the Group. It is
expressed as quantitative limits and captured in the Risk Appetite Statement adopted by the Management Board and approved by the Supervisory Board.
The limits are set using stress tests and scenario analyses. They ensure stability of the Bank’s and the Group’s position even if special situations occur.
Global limits are used to set watch limits and define risk management policies.
The integrated risk management structure includes relevant committees which have been set up to decide on identification of individual risks and internal
risk management standards and policies, and to monitor the risk level.
The Bank has also established a relevant organisational structure to mitigate risk at three independent and complementary levels (lines of defence), i.e.:
organisational units which generate risk and are required to comply with the rules ensuring high quality and correctness of their performance;
units responsible for identification, measurement, monitoring and mitigation of risks in a way that ensures independence of risk control
functions from risk-taking units;
the internal audit function, whose tasks involve assessment of the management system of the Bank and its subsidiaries, including the
effectiveness of managing the risk related to the Bank’s business and the business of its subsidiaries.
Risk management structure
The Bank’s Supervisory Board, supported by the Audit and Compliance Committee of the Supervisory Board and the Risk Committee, is responsible for
ongoing supervision of the risk management system in Santander Bank Polska S.A. The Supervisory Board approves the strategy, key risk management
policies and risk appetite, and monitors the use of internal limits from the perspective of current business strategy and the macroeconomic environment.
It reviews the key risk areas, the identification of threats and the process of defining and monitoring remedial actions. The Supervisory Board also assesses
the effectiveness of risk management measures taken by the Management Board.
The Bank’s Management Board is responsible for implementing an effective risk management system that is compliant with the regulatory requirements
and internal regulations. Specifically, the Bank’s role in this regard is to set up an organisational structure tailored to the size and profile of the risks taken,
to segregate responsibilities in order that risk assessment and control functions remain independent of operational functions, to introduce and update a
risk management strategy and ensure an adequate information policy.
The Management Board fulfils its risk management role through the following two committees:
The Risk Management Committee, which approves the key decisions taken by the main lower-level risk committees (mainly credit decisions),
annual limits for securities trading and ALM transactions and an annual plan of risk assessment models.
The Risk Control Committee, which monitors the risk level across different areas of the Bank’s operations and supervises the activities of lower-
level risk management committees set up by the Management Board.
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> Governance structure for risk supervision and management
The Risk Control Committee supervises the following committees responsible for risk management in the Group:
Credit Risk Committee
Credit Policy Forum for Retail Credit Portfolios
Credit Policy Forum for SME Credit Portfolios
Credit Policy Forum for Business and Corporate Credit Portfolios
Credit Committee
Provisions Committee
AML Operating Committee
General Compliance Committee
Disclosure Committee
Local Marketing and Monitoring Committee
Regulatory and Reputational Risk Committee
Model Risk Management Committee
Capital Committee
Liquidity Forum
ALCO
CyberTechRisk Forum
ORMCO
Information Management Committee
Restructuring Committee
Provisions Committee
Credit Committee
Market and Investment Risk Committee
Credit Policy Forum for Business and Corporate
Credit Portfolios
Credit Policy Forum for SME Credit Portfolios
Risk Committee
Risk Management
Committee
Supervisory Board
of Santander Bank Polska
S.A.
Management Board
of Santander Bank Polska
S.A.
Risk Control Committee
Internal Audit Area
Audit and Compliance
Committee
Suppliers Panel
Responsible Banking and Corporate Culture
Committee (including the ESG Forum)
Credit Risk Committee
Credit Policy Forum for Retail Credit Portfolios
ESG Panel
Gold Committee
Silver Committee
Bronze Group
AML Decision Committee
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Restructuring Committee
Market and Investment Risk Committee
Model Risk Management Committee
Operational Risk Management Committee/ ORMCO
CyberTech Risk Forum
Information Management Committee
Assets and Liabilities Committee/ ALCO
Liquidity Forum
Capital Committee
Disclosure Committee
Local Marketing and Monitoring Committee
General Compliance Committee
Regulatory and Reputational Risk Committee
AML Operating Committee
AML Decision Committee
Suppliers Panel
Responsible Banking and Corporate Culture Committee (including the ESG Forum)
ESG Panel
The Bank has dedicated authorities which are convened in crisis situations:
Gold Committee
Silver Committee
Bronze Group
These committees, acting within the respective remits defined by the Management Board, are directly responsible for developing risk management
methods and monitoring risk levels in specific areas. Through these committees, the Bank also supervises the risk attached to the operations of its
subsidiaries.
The subsidiaries implement risk management policies and procedures that reflect the approach adopted by Santander Bank Polska S.A., which ensures
the consistency of risk management processes across the Group.
The Bank oversees the risk management structure of Santander Consumer Bank S.A. (SCB S.A.) under the applicable law and in line with the same
oversight rules as applied to other Santander Bank Polska Group companies. The representatives of Santander Bank Polska S.A. on the Supervisory Board
of SCB S.A. are two Vice Presidents of the Bank’s Management Board in charge of the Risk Management Division and the Retail Banking Division. Together
with SCB S.A. Supervisory Board, they are responsible for supervision over SCB S.A. and make sure that the company operates in line with the adopted
plans and operational security procedures. The Bank monitors the profile and level of SCB S.A. risk via risk management committees of Santander Bank
Polska S.A., which receive relevant reports on SCB S.A.’s operations.
2. Risk management priorities in 2023
War in Ukraine, conflict in the Middle East, macroeconomic situation and inflation
Due to the war in Ukraine and the conflict in the Middle East, the importance of geopolitical risk in risk management processes is still high. The Group
identifies this risk both in its operations and in relation to its loan book and financial assets. It is based on the definition and assessment of material risks
that may arise due to the geopolitical situation and threaten the delivery of business plans of Santander Bank Polska S.A.
To maintain business continuity, the Group closely monitors external developments and their impact on its operations. The monitoring covers, among
other things, the key threats related to the above armed conflict, which allows the Group to appropriately adjust its control mechanisms to potential
scenarios and be fully prepared to minimise the impact of emerging risks. Both first and second line of defence units are involved in this process and key
information is provided to senior management.
In 2023, the Bank continued to monitor its credit portfolio in terms of the impact of geopolitical factors on the performance of borrowers from individual
segments. The assessment covered both direct consequences (sanctions, restriction of operations of business customers in Russia and Belarus,
cooperation with entities from the Middle East) and indirect consequences of the geopolitical situation for borrowers (increased prices of energy,
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commodities, materials and labour as well as the impact of disinflation, high interest rates and changes in consumer behaviour). The quality of loans held
by Ukrainian citizens was closely monitored too.
Apart from the standard monitoring performed on an ongoing basis, the Bank assessed the impact of the geopolitical and macroeconomic factors on
individual customers by:
analysing macroeconomic indicators and monitoring behavioural models (including transactional patterns);
monitoring market trends using stress tests based on external and internal macroeconomic scenarios (the analysis covered in particular zloty
depreciation and interest rate hikes).
The Bank also identified and analysed potential new risks for individual sectors and portfolios connected with the geopolitical and macroeconomic
situation and developed relevant mitigants.
Due to rising interest rates, new laws were introduced in 2022 under which banks offered payment holidays and increased access to the Borrowers
Support Fund. Both processes, implemented in remote channels last year, remain in the Group’s offer in 2023. The use of these aid solutions by customers
is still closely monitored.
Cybersecurity
The importance of cybersecurity has been steadily growing because of the increasing digitalisation of the banking sector. The geopolitical situation did
not improve in 2023, therefore the risk of targeted attacks made by well-structured, disciplined and sophisticated hacker groups was monitored on an
ongoing basis. The risk connected with the consequences of potential attacks was regularly analysed and relevant measures were taken where justified.
Disinformation campaigns aimed to destabilise the financial sector were also subject to close monitoring. The Bank kept taking measures to build
awareness among employees and customers, e.g. by issuing security warnings about emerging threats. Particular focus was placed on the problem of
unauthorised transactions and on the security of processes, including the authentication and authorisation of transactions in remote channels. Other
priority issue was the risk of DDoS attacks, malware and attacks against customers and employees with the use of social engineering.
Cyber attacks have become more sophisticated and specialised. Particularly popular are attacks based on new technologies offered by cybercriminals
under a service model.
The Group is analysing the growing role of artificial intelligence technologies, both in terms of their use by attackers but also in terms of their potential
as control mechanisms that can facilitate risk and cybersecurity management. A special focus is placed on the proposed European law on artificial
intelligence (EU AI Act) and its impact on the organisation.
ESG risks
The Group developed its resources in terms of the management of ESG (Environmental, Social and Governance) risks. The ESG Risk Management Office
was set up in the Risk Management Division to ensure proper organisation of the ESG risk management function. The Office is particularly responsible
for integrating ESG risks into the internal risk management framework, including credit risk assessment and monitoring.
The Group does not recognise ESG risk as a separate material risk, but indicates its channels of transmission to credit, market, liquidity, compliance,
reputational, business, and operational risks. At the same time, the Group keeps extending its analysis of risk transmission channels and currently the
analysed impact is being expanded to include market risk in the trading book and liquidity risk. The use of this approach has implications for the process
of estimating and quantifying material risks.
A methodology was introduced to assess climate risks (physical and transition ones) connected with individual sectors and properties, allowing the Bank
to conduct a collective analysis of the materiality of climate risks connected with the credit portfolio. Relevant reports are already presented to the
competent committees. The methodology will be further developed in 2024 based on more precise data which will be used for credit risk assessment of
customers and transactions.
In 2023, the Group formalised the assessment of social and environmental risks in the financed projects. The analysis is made in line with the Equator
Principles, a market standard and a common language for assessment of environmental and social risks in projects, applied by large financial institutions
worldwide. This assessment is carried out by the business line and ESCC analysts acting together. In the first step, project category is identified in the
context of its potential impact on environmental and social issues. Next, the project is analysed in detail (the level of such analysis depending on the
category assigned). The follow-up recommendation is recognised in the credit application.
The admission process for sustainable finance was formalised across all segments, both at a transaction and credit product level. In 2023, the ESG Panel
was set up as part of the Risk Management Division to handle the certification of sustainable finance based on internal and external regulations, this way
mitigating greenwashing risk. A series of meetings were held to raise the awareness of ESG risks and present the impact of ESG requirements on the
Bank’s operations. In particular, a dedicated training was delivered to members of the Bank’s Management and Supervisory Boards and key management
personnel.
The Group joined the project on the measurement of financed emissions in accordance with the PCAF methodology in order to more precisely analyse
the structure of emissions in all sectors and business segments. The project involved six training sessions for all interested units from the Bank on the
three scopes of emissions and their calculation methodology. Currently, the Group is refining those calculations in order to identify and implement
decarbonisation levers.
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Ruling practice related to foreign currency mortgage loans
As there is no unanimous ruling practice in relation to cases regarding loans indexed to or denominated in foreign currency and it is not possible to predict
the Supreme Court’s decisions on individual cases and there are still questions pending preliminary ruling by the CJEU, at the date of these financial
statements the Group estimated the legal risk associated with the portfolio of loans indexed to and denominated in a foreign currency using a model
which considers different possible judgments (in the form of adjustment to the gross carrying amount for active exposures or provisions for inactive
exposures), including those which are the subject of the request for the resolution of the entire Civil Chamber of the Supreme Court. The model can also
be affected by subsequent CJEU rulings on questions referred by the Polish courts, the stance of the Supreme Court and the ruling practice of national
courts. The Group is monitoring court decisions taken with regard to foreign currency loans in terms of the ruling practice and its possible changes. The
model might also be affected by a potential intervention of legislators aimed to restore the balance between the parties following the removal of the
unfair clause to protect legal relationships from mass annulment of mortgage loan agreements.
In view of the above, the Group identified the risk that in the case of lawsuits which have already been filed or are predicted to be filed based on applicable
models the scheduled cash flows from the portfolio of mortgage loans denominated in and indexed to foreign currencies might not be fully recoverable
and/or that a liability might arise, resulting in a future cash outflow. The Group recognises the impact of legal risk associated with foreign currency
mortgage loans in line with the requirements arising from:
As at 31 December 2023, the Group had a portfolio of 30.7k CHF-denominated and CHF-indexed loans of PLN 6.3bn gross (PLN 8.4bn as at 31 December
2022) before adjustment to the gross carrying amount at PLN 4.1bn (PLN 3.1bn as at 31 December 2022) reducing contractual cash flows in respect of
legal risk.
As at 31 December 2023, the total impact of legal risk connected with foreign currency mortgage loans recognised in the consolidated statement of
financial position was PLN 5.0bn vs PLN 3.6bn as at 31 December 2022. The total cost in this regard recognised in the income statement was PLN 2.6bn
for 2023 and PLN 1.7bn for 2022.
The Bank continuously monitors the ruling practice of Polish courts and the CJEU concerning foreign currency mortgage loans and adjusts its strategy
accordingly. The adequacy of the provisions will continue to be monitored and assessed in subsequent reporting periods.
For more information, see Note 48 “Legal risk connected with CHF mortgage loans” to the Consolidated Financial Statements of Santander Bank Polska
Group for 2023.
Interest rate benchmark reform
In connection with Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial
instruments and financial contracts (BMR) and a decision on cessation of LIBOR by ICE Benchmark Administration Limited (IBA) at the end of 2021,
Santander Bank Polska S.A. launched the IBOR Programme aimed at preparing and implementing changes necessary to offer products based on new
benchmarks and execute annexes to existing agreements due to the cessation of previous benchmarks.
Significant progress on the benchmark reform in Poland has been made since the adoption of the Act on crowdfunding for business and support for
borrowers (Journal of Laws of 2022, item 1488), laying down the rules for cessation or liquidation of WIBOR (Article 85). The National Working Group for
benchmark reform was established in Poland to implement a new benchmark. On 27 September 2022, a Roadmap was published in relation to the
replacement of WIBID and WIBOR with WIRON. On 25 October 2023, it was modified in terms of completion dates.
The assumptions of the National Working Group are implemented at the Bank as part of the WIBOR Project by a wide group of experts representing all
business lines of the Bank, supported by renowned advisory companies. It is supervised by the Steering Committee composed of the Management Board
members and senior managers. Work is underway to implement products based on WIRON as outlined in the Roadmap.
3. Material risk factors expected in the future
The economic growth in 2023 was characterised by deceleration in output and consumption, and high expansion in services and investments. While the
economic activity is expected to pick up in 2024 in terms of output and consumption, there is a growing risk of slowdown in services. Investments should
continue the upward trend. GDP growth is projected to gradually accelerate to approx. 3% on average during the year. The economic growth will be
driven mainly by the domestic demand supported by the solid recovery of consumption, continued (albeit slightly lower) increase in investments and end
of the sharp reduction of excessive inventories. PLN appreciation limiting the profitability of exports may weigh down on the performance of some
companies. On the other hand, it may help combat inflation, which has fallen but remains elevated, negatively affecting the purchasing power
(particularly of those who do not benefit from higher deposit interest rates or returns on equity). As a result, the quality of credit portfolios may come
under pressure:
In the case of individuals, the level of arrears will remain high due to increased interest rates.
Manufacturers, in particular highly leveraged companies (which account for an insignificant share of the Bank’s loan book), are likely to face liquidity
problems.
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117
The quality of the Bank’s credit portfolios is still good.
In May 2023, the representatives of the Polish Financial Supervision Authority (KNF) announced that a new long-term financing indicator would be
introduced, requiring banks to finance a specific part of the mortgage loan portfolio with long-term liabilities. The target value of the indicator has not
been proposed yet. Once introduced, the indicator may cause an increase in the cost of funding incurred by Polish mortgage lenders.
Cyber risk and risk related to modern digital technology have been the top concerns for many years. This relates both to human behaviour and
technological aspects. The following threats still prevail: the loss or theft of sensitive data, disruption of key services, attacks against customer assets
and fraudulent transactions. They result from the dynamic growth of modern IT technologies and digital transformation.
The risk of ransomware attacks, DDoS attacks or use of social engineering is not likely to decrease in 2024 either. Supply chain attacks, mobile malware
attacks, cyber spying and attacks involving artificial intelligence are expected to be a growing threat to cybersecurity. Other challenges will include
supplier risk management, cloud computing and shadow IT.
Due to the geopolitical situation connected with the war in Ukraine, the Group will continue to place a special focus on the risk of targeted attacks made
by well-structured, disciplined and sophisticated hacker groups.
The Group will continue to build, test and improve digital operational resilience ensuring the continuity and high quality of services in accordance with
the Digital Operational Resilience Act (DORA).
Another priority for 2024 will be to implement new elements of ESG risk management in the Group. Particularly important will be to integrate climate-
related factors into existing risk assessment policies and procedures for the purpose of taking investment and credit decisions. The environmental risk
analysis will become an integral part of the standard credit risk analysis. It will cover the borrower’s exposure to environmental risks related to climate
change as well as the impact of those risks on the customer’s business and their repayment capacity in the next years.
In H1 2024, the new EU guidelines on the management of interest rate risk in the banking book are expected to come into force. They include a supervisory
outlier test, which is used to assess the volatility of banks’ net interest income. If the net interest income declines by more than 5% of Tier 1 capital under
stress conditions, the bank must report it to the relevant regulator.
4. Credit risk management
Credit risk
Credit risk is defined as the possibility of suffering a loss if the borrower fails to meet their credit obligation, including payment of interest and fees. It
results in the impairment of credit assets and contingent liabilities as a consequence of the borrower’s worsening credit quality. Credit risk measurement
is based on the estimation of credit risk weighted assets, with the relevant risk weights representing both the probability of default and the potential loss
given default of the borrower.
Credit risk in the Bank and the Group arises mainly from lending activities on the retail, corporate and interbank markets. This risk is managed as part of
the policy approved by the Management Board on the basis of the applicable credit procedures and discretionary limits. The internal system of credit
grading and monitoring used by the Bank and the Group enables early identification of potential defaults that might impair the loan book. Additionally,
the Bank and the Group use credit risk mitigation tools: collateral (financial and non-financial) and specific credit provisions and clauses (covenants).
Credit risk management in the Bank and the Group involves measures taken as a result of the ongoing analysis of the macroeconomic environment and
internal reviews of particular credit portfolios. These advanced credit risk assessment tools allow quick remedial actions to be taken in response to the
first signs of any change in the portfolio’s quality or structure.
Credit policy
The credit policy adopted by the Bank and the Group is a set of principles and guidelines included in credit policies and procedures which are reviewed on
a regular basis. Internal limits are crucial components of the credit policy because they facilitate the monitoring of exposure concentration within
individual sectors, geographical regions and foreign currencies. Pursuant to the policy in place, the Bank and Santander Bank Polska Group ensure
adequate diversification of the credit portfolio in terms of exposure towards individual customers and sectors.
The Bank’s credit policy is defined by the Credit Risk Committee for the consolidated portfolio and cross-segment cases, and by three Credit Policy Forums
for individual portfolios (personal customers, SMEs and corporate customers). Higher-level policies are approved by the Bank’s Management Board. The
above-mentioned committees, together with the Risk Control Committee (at the Management Board level) and the Risk Committee, also monitor the
Bank’s and the Group’s credit portfolios based on regular management reports. In 2023, the Bank and the Group continued to pursue the existing credit
risk management policy, keeping credit risk at a safe level while ensuring high profitability of loan portfolios, growth of business volumes and an increase
in market share. Credit policies and processes were optimised in response to macroeconomic developments, including increased interest rates, zloty
appreciation and persistently high inflation.
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The lending activity of subsidiaries is modelled on the Bank’s credit policies. In the decision making process, the Bank and Santander Bank Polska Group
follow a consistent approach to credit risk and use the same IT platform to assign rating/ scoring (this does not apply to SCB S.A.). Subsidiaries have credit
risk management procedures in place which are consistent with the regulations applied by the Bank.
Credit risk management process
Key elements of the credit risk management process in the Bank and in Santander Bank Polska Group
Credit decision making
process
The credit decision making process is based on individual credit discretions vested in credit officers, commensurate with
their knowledge and experience relating to particular activities and specific needs of respective segments (branch
banking, SME banking, business banking and corporate banking).
Large credit exposures in excess of PLN 50m are referred to the Credit Committee composed of senior managers.
Transactions above stated thresholds (from PLN 48.75m to PLN 195m, depending on the type of financing and the
customer’s rating) are additionally signed off by the Management Board’s Risk Management Committee.
Credit grading
Credit risk assessment tools are regularly developed and adapted to the KNF’s guidelines, International Accounting
Standards/ International Financial Reporting Standards and best market practice.
Rating models are used in relation to the majority of credit portfolios, including corporate customers, SMEs, home loans,
property loans, cash loans, credit cards and personal overdrafts.
The Group periodically monitors credit grading. For all portfolios, credit grade is automatically verified based on the
number of days past due. Additionally, for the majority of portfolios, the automated process also includes an analysis of
behavioural factors.
Credit reviews
The Group performs regular reviews to determine the actual quality of the credit portfolio, confirm that appropriate
credit grading and provisioning processes are in place and verify compliance with the procedures and credit decisions.
The reviews are conducted by specialised units that are independent of credit risk-taking units.
Collateral
The Collateral and Credit Agreements Department is a central unit responsible for ensuring that any security items at
Santander Bank Polska Group are duly established and held effective in line with the lending policy for respective
business segments, and that they are properly monitored and released. The Department also provides assistance to
credit units in credit decision making and development of credit policies, collects data on security covers and ensures
appropriate management information. It also handles property valuations at the Bank.
Data about collateral are registered both in ICBS and in the Central Collateral Database (CCD) whose business owner is
the Collateral and Credit Agreements Department.
Credit risk stress testing
Stress tests are used to evaluate potential effects of specific events, movements in financial and macroeconomic ratios
or changes in the risk profile on the condition of the Group. As part of these tests, potential changes in credit portfolio
quality under adverse conditions are assessed. The process also provides management information about the adequacy
of the agreed limits and internal capital allocation.
Forbearance
As part of proactive management of credit risk and credit portfolio quality, Santander Bank Polska Group takes measures
aimed at early implementation of debt restructuring (forbearance solutions) with respect to customers in financial
difficulty. The purpo
se of debt restructuring is to better match repayment terms with the current and projected financial
standing of the customer, minimise default risk and/or maximise recovery.
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Implementation of Recommendation R
Santander Bank Polska Group applies rules for classification of credit exposures, estimation and recognition of expected credit losses and management
of credit risk as required by Recommendation R of the Polish Financial Supervision Authority (KNF). In particular:
Credit exposures are classified as follows:
Where the Bank has balance sheet exposures to the borrower which are more than 90 days past due and which exceed 20% of all balance
sheet exposures to that borrower, all balance sheet and off-balance sheet exposures to that borrower are considered non-performing.
Where an exposure is more than 90 days past due but the materiality threshold for past due credit obligations is not met, the exposure
is classified to Stage 2.
POCI exposures are identified based on all customer’s exposures.
If the Bank learns about the submission of a request for any restructuring proceedings as defined by the Restructuring Law Act, the Bank
may classify the case to the non-performing loan portfolio.
The Bank has parameter models for the calculation of expected credit losses (ECLs) as well as their validation and monitoring processes:
Before the ECL parameter models are first used, the implementation process is validated.
The Audit Committee is notified of any significant changes that are planned to be introduced.
Backtesting results are reported with the required frequency.
The credit risk management and supervision process comprises the following elements:
The Management Board and the Supervisory Board approve the regulations concerning the calculation of ECL allowances and regularly
monitor results of that process.
The member of the Bank’s Management Board in charge of risk management approves the level of ECL allowances.
The Bank analysed and adjusted a range of internal regulations.
Collateral for the selected credit exposures is monitored more frequently.
The definition of a gross carrying amount applied by the Bank includes all interest on a credit exposure accrued in accordance with the
loan agreement.
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> Homogeneous exposure portfolio – receivables from retail customers at amortised cost as at 31 December 2023 and
31 December 2022 (PLN k)
31.12.2023 PD scale
Initial
gross
balanc
e sheet
exposu
res
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in %
– permitted
range
(0%-100%)
Number of
exposures
Average
LGD in %
Average
maturity
Expected
Credit Loss
(ECL)
Stage
1
from 0.00% to <0.15%
1 144
010
2 552 715
12 920 715
0%
316 785
18%
19
7 575
from 0.15% to <0.25%
652 421
643 573
1 370 279
1%
174 901
31%
7
2 879
from 0.25% to <0.50%
190 201
0
2 603 251
1%
24 851
16%
19
4 040
from 0.50% to <0.75%
2 522
703
347 901
3 013 713
3%
239 986
33%
7
31 066
from 0.75% to <2.50%
8 891
730
412 375
9 347 213
2%
410 955
45%
7
101 238
from 2.50% to <10.0%
3 384
316
122 771
3 455 721
6%
214 965
44%
6
87 644
from 10.0% to <45.0%
358 392
15 033
344 518
11%
126 610
45%
4
17 557
from 45.0% to <100.0%
2 732
0
2 618
25%
93
47%
6
306
Stage
from 0.00% to <0.15%
23 114
19
123 092
28%
22 502
20%
17
4 507
from 0.15% to <0.25%
27 311
595
44 056
31%
5 714
32%
9
3 519
from 0.25% to <0.50%
9 893
496
88 335
35%
8 559
17%
20
3 496
from 0.50% to <0.75%
85 250
2 953
91 893
54%
19 368
35%
7
13 383
from 0.75% to <2.50%
316 480
12 143
356 654
53%
65 768
41%
8
59 106
from 2.50% to <10.0%
473 559
26 356
503 252
57%
159 833
43%
6
93 728
from 10.0% to <45.0%
211 835
153
201 032
49%
528 992
45%
3
34 624
from 45.0% to <100.0%
11 930
-1
11 764
42%
13 0558
45%
3
1 878
POCI
from 45.0% to <100.0%
39 740
14
62 679
32%
7 662
28%
10
4 603
31.12.2023 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number
of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
860 091
54 904
53%
455 501
from 13 to 24 months
238 630 15 493 57% 138 981
from 25 to 36 months
96 495
6 124
77%
75 167
from 37 to 48 months
40 255
1 277
88%
35 815
from 49 to 60 months
30 786
989
87%
27 944
from 61 to 84 months
26 043
1 017
92%
25 190
above 84 months
10 895
517
98%
11 190
POCI
up to 12 months
54 126
8 177
53%
29 237
from 13 to 24 months
46 544
6 407
56%
26 872
from 25 to 36 months
13 269
994
76%
10 450
from 37 to 48 months
4 465
240
87%
4 035
from 49 to 60 months
2 080
98
78%
1 684
from 61 to 84 months
19 026
288
94%
18 725
above 84 months
13 893
254
100%
14 352
Management Board Report on Santander Bank Polska Group Performance in 2023
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121
31.12.2022 PD scale
Initial
gross
balance
sheet
exposure
s
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in %
– permitted
range
(0%-100%)
Number of
exposures
Average
LGD in %
Average
maturity
Expected
Credit Loss
(ECL)
Stage
1
from 0.00% to <0.15% 705,728 2,552,715 11,622,585 0% 138,496 18% 21 6,474
from 0.15% to <0.25%
780,511
643,573
1,892,847
1%
298,326
30%
8
3,960
from 0.25% to <0.50%
355,622
0
2,971,957
1%
77,663
18%
19
5,137
from 0.50% to <0.75%
4,061,684
347,901
4,555,859
3%
249,404
38%
7
46,977
from 0.75% to <2.50%
5,862,988
412,375
6,523,766
3%
333,082
43%
8
78,179
from 2.50% to <10.0%
3,616,094
122,771
3,748,346
5%
280,810
45%
6
88,735
from 10.0% to <45.0%
390,784
15,033
377,957
10%
114,247
46%
4
16,836
from 45.0% to
<100.0%
4,094 0 3,919 25% 160 48% 6 448
Stage
from 0.00% to <0.15%
18,666
19
126,732
25%
2,622
19%
19
3,905
from 0.15% to <0.25%
28,801
595
53,999
29%
7,301
32%
9
3,861
from 0.25% to <0.50% 13,999 496 93,415 32% 12,579 19% 20 3,569
from 0.50% to <0.75%
136,196
2,953
146,696
55%
4,767
38%
7
24,198
from 0.75% to <2.50% 233,533 12,143 267,796 51% 31,270 40% 8 43,373
from 2.50% to <10.0%
387,682
26,356
440,495
54%
114,784
41%
7
78,529
from 10.0% to <45.0%
123,366
153
119,302
43%
445,318
43%
4
18,142
from 45.0% to
14,344 153 14,358 21% 206,098 42% 1 1,238
POCI
from 45.0% to
<100.0%
25,836 14 61,114 24% 6,205 26% 11 2,876
31.12.2022 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number
of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
743,127
62,524
51%
377,453
from 13 to 24 months
296,448
15,224
65%
195,511
from 25 to 36 months
120,644
3,363
81%
99,402
from 37 to 48 months
61,851
1,960
87%
56,445
from 49 to 60 months
26,097
1,028
86%
23,813
from 61 to 84 months
20,086
778
89%
18,597
above 84 months
7,742
353
97%
7,843
POCI
up to 12 months
94,486
9,703
48%
46,110
from 13 to 24 months
24,572
1,961
60%
15,303
from 25 to 36 months
12,049
682
73%
9,115
from 37 to 48 months
4,681
217
80%
3,893
from 49 to 60 months
21,415
329
91%
20,335
from 61 to 84 months
17,405
154
94%
17,006
above 84 months
13,216
300
100%
13,398
Management Board Report on Santander Bank Polska Group Performance in 2023
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122
> Homogeneous exposure portfolio – receivables from retail customers in respect of mortgage loans at amortised cost as at 31
December 2023 and 31 December 2022 (PLN k)
31.12.2023 PD scale
Initial gross
balance sheet
exposures
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in
% – permitted
range
(0%-100%)
Number of
exposures
Average
LGD
in %
Averag
e
maturit
y
Expected
Credit Loss
(ECL)
Stage
from 0.00% to <0.15%
35 934 917
798 710
35 612 487
0%
161 722
17%
21
17 536
from 0.15% to <0.25%
1 504 114
70
1 452 690
1%
16 549
14%
16
1 934
from 0.25% to <0.50%
6 875 330
116 796
6 694 404
1%
39 711
15%
20
8 222
from 0.50% to <0.75%
1 731 851
56 034
1 684 044
1%
10 303
15%
20
2 502
from 0.75% to <2.50%
1 991 544
37 048
1 943 660
1%
12 402
16%
20
3 978
from 2.50% to <10.0%
552 343
23 627
549 000
2%
3 335
19%
20
2 036
from 10.0% to <45.0%
319
0
299
6%
4
11%
9
2
from 45.0% to <100.0%
0
0
0
0%
0
0%
0
0
Stage
from 0.00% to <0.15%
569 271
0
554 881
19%
2 000
18%
22
10 961
from 0.15% to <0.25%
66 665
0
64 881
33%
380
18%
20
2 602
from 0.25% to <0.50%
312 401
0
302 949
27%
1 211
17%
21
8 657
from 0.50% to <0.75%
60 715
0
58 803
30%
289
16%
21
1 882
from 0.75% to <2.50%
189 969
1 755
189 670
30%
804
17%
22
6 403
from 2.50% to <10.0%
148 416
7 391
145 183
32%
892
16%
18
4 546
from 10.0% to <45.0%
5 127
72
5 094
23%
25
15%
13
101
from 45.0% to <100.0%
115
0
95
1%
1
15%
0
0
POCI
from 2.50% to <10.0%
-
171
-
-
-
-
-
-
from 10.0% to <45.0%
-
16
-
-
-
-
-
-
from 45.0% to <100.0%
89 622 21 74 282 23% 630 15% 15 1 985
31.12.2023 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
335 486
1 787
19%
64 972
from 13 to 24 months
206 911
1 141
27%
57 225
from 25 to 36 months
92 947
529
38%
36 614
from 37 to 48 months
49 981
299
51%
26 578
from 49 to 60 months
64 515
316
64%
44 165
from 61 to 84 months
75 561
444
85%
66 102
above 84 months
47 896
218
100%
49 742
POCI
up to 12 months
10 711
84
21%
2 268
from 13 to 24 months
38 809
177
25%
9 688
from 25 to 36 months
16 165
54
38%
6 133
from 37 to 48 months
4 027
23
46%
1 888
from 49 to 60 months
5 143
28
66%
3 465
from 61 to 84 months
13 982
64
80%
11 811
above 84 months
32 710
111
100%
34 538
Management Board Report on Santander Bank Polska Group Performance in 2023
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123
31.12.2022 PD scale
Initial gross
balance sheet
exposures
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in
% – permitted
range
(0%-100%)
Number of
exposures
Average
LGD
in %
Averag
e
maturit
y
Expected
Credit Loss
(ECL)
Stage
from 0.00% to <0.15%
33,906,152
798,710
34,018,805
0.3%
160,477
17%
22
16,560
from 0.15% to <0.25%
2,319,464
70
2,287,719
0.9%
18,894
16%
16
3,472
from 0.25% to <0.50%
7,396,105
116,796
7,261,641
0.7%
42,337
16%
21
8,982
from 0.50% to <0.75% 1,762,887 56,034 1,724,933 1.0% 10,545 16% 21 2,591
from 0.75% to <2.50%
2,249,423
37,048
2,211,284
1.3%
13,234
17%
21
5,041
from 2.50% to <10.0%
619,596
23,627
625,903
2.2%
3,835
17%
19
2,390
from 10.0% to <45.0%
168
0
159
0.4%
3
10%
8
0
from 45.0% to <100.0%
0
0
0
0.0%
0
0%
0
0
Stage
from 0.00% to <0.15%
490,961
0
474,393
19.0%
1,719
18%
22
8,564
from 0.15% to <0.25%
74,931
0
73,127
32.6%
363
19%
18
2,895
from 0.25% to <0.50%
279,813
0
271,046
26.2%
1,062
18%
22
7,152
from 0.50% to <0.75%
59,798
0
58,350
26.6%
262
17%
21
1,539
from 0.75% to <2.50%
147,998
1,755
142,468
29.2%
644
18%
22
4,491
from 2.50% to <10.0%
185,030
7,391
183,834
32.1%
1,003
16%
18
5,948
from 10.0% to <45.0%
5,377
72
5,236
22.3%
26
16%
17
100
from 45.0% to <100.0%
761
0
704
54.7%
2
18%
15
52
POCI
from 2.50% to <10.0% - 171 - - - - - -
from 10.0% to <45.0%
-
16
-
-
-
-
-
-
from 45.0% to <100.0%
108,173
21
96,329
23%
644
17%
15
2,627
31.12.2022 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
389,586
1,962
19%
75,321
from 13 to 24 months
149,277
742
34%
50,593
from 25 to 36 months
73,923
375
42%
31,469
from 37 to 48 months
85,224
367
53%
48,427
from 49 to 60 months
62,245
310
67%
43,748
from 61 to 84 months
80,151
398
82%
68,362
above 84 months
42,817
176
100%
44,610
POCI
up to 12 months
55,126
229
22%
11,920
from 13 to 24 months
13,317
49
31%
4,168
from 25 to 36 months
5,943
23
38%
2,254
from 37 to 48 months
7,070
28
53%
3,893
from 49 to 60 months
15,048
49
66%
10,484
from 61 to 84 months
16,438
52
85%
14,691
above 84 months
43,968
128
100%
46,194
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
124
> Homogeneous exposure portfolio – receivables from corporate customers at amortised cost as at 31 December 2023 and 31
December 2022 (PLN k)
31.12.2023 PD scale
Initial gross
balance sheet
exposures
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in
% – permitted
range
(0%-100%)
Number of
exposures
Average
LGD in %
Average
maturity
Expected
Credit Loss
(ECL)
Stage
from 0.00% to <0.15%
22 530 650
8 253 803
24 241 969
0%
1 182
38%
1
6 835
from 0.15% to <0.25%
4 473 319
3 008 143
4 458 890
0%
2 809
35%
3
6 028
from 0.25% to <0.50%
13 617 382
8 740 118
13 673 055
1%
13 702
32%
3
25 897
from 0.50% to <0.75%
6 391 699
5 838 993
5 968 108
1%
4 679
39%
3
21 728
from 0.75% to <2.50%
12 157 647
8 094 311
11 463 216
2%
31 137
39%
3
71 617
from 2.50% to <10.0%
3 925 830
999 234
3 583 688
3%
30 561
36%
5
44 174
from 10.0% to <45.0%
223 391
8 456
204 776
3%
11 888
42%
4
3 244
from 45.0% to <100.0%
328
0
308
4%
56
5%
7
1
Stage
from 0.00% to <0.15%
8 484
0
7 673
33%
36
23%
8
483
from 0.15% to <0.25%
220 192
442
243 865
8%
72
39%
2
5 718
from 0.25% to <0.50%
285 897
0
295 374
55%
369
48%
5
73 498
from 0.50% to <0.75%
570 564
45 873
492 804
18%
283
47%
7
30 878
from 0.75% to <2.50%
947 788
140 617
1 046 217
30%
2 632
36%
4
89 962
from 2.50% to <10.0%
1 105 290
326 919
1 231 494
28%
21 815
30%
3
92 081
from 10.0% to <45.0%
663 231
59 035
618 029
39%
4 527
41%
3
85 168
from 45.0% to <100.0%
51 826
0
44 086
70%
47
21%
3
6 407
POCI
from 0.25% to <0.50%
-
123 836
-
-
-
-
-
-
from 0.50% to <0.75%
-
-
-
-
-
-
-
-
from 0.75% to <2.50%
- 680 - - - - - -
from 2.50% to <10.0%
-
3 320
-
-
-
-
-
-
from 10.0% to <45.0%
-
1
-
-
-
-
-
-
from 45.0% to <100.0%
3 676
-
3 135
23,6%
458
51%
3
232
31.12.2023 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number
of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
970 855
23 422
28%
397 934
from 13 to 24 months
545 552
12 061
35%
316 041
from 25 to 36 months
267 626
13 019
59%
198 110
from 37 to 48 months
213 042
4 928
41%
139 618
from 49 to 60 months
240 203
3 124
28%
175 462
from 61 to 84 months
108 026
2 589
74%
99 128
above 84 months
350 249
872
12%
221 236
POCI
up to 12 months
78 115
1 976
21%
34 279
from 13 to 24 months
239 739
2 216
5%
39 896
from 25 to 36 months
64 252
1 873
14%
37 022
from 37 to 48 months
24 462
1 090
31%
14 222
from 49 to 60 months
126 528
1 082
8%
47 596
from 61 to 84 months
42 858
1 170
27%
16 247
above 84 months
37 963
160
24%
29 363
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
125
31.12.2022 PD scale
Initial gross
balance sheet
exposures
Off-balance
sheet
exposures
EAD after
credit risk
mitigation and
use of credit
conversion
factor
Average PD in
% – permitted
range
(0%-100%)
Number of
exposures
Average
LGD in %
Average
maturity
Expected
Credit Loss
(ECL)
Stage
from 0.00% to <0.15%
18,958,027
8,253,803
18,639,406
0.1%
1,873
39%
1
6,297
from 0.15% to <0.25%
3,972,926
3,008,143
3,925,474
0.4%
4,845
39%
3
6,362
from 0.25% to <0.50%
13,461,463
8,740,118
12,908,100
0.5%
9,250
34%
3
24,819
from 0.50% to <0.75%
6,716,054
5,838,993
6,141,221
1.0%
6,896
38%
3
24,523
from 0.75% to <2.50%
11,673,403
8,094,311
10,951,219
1.4%
29,297
34%
3
54,826
from 2.50% to <10.0%
4,110,850
999,234
3,851,022
2.8%
41,613
37%
5
43,427
from 10.0% to <45.0%
293,405 8,456 270,475 3.2% 4,304 41% 5 4,063
from 45.0% to <100.0%
371
0
352
2.7%
35
5%
8
1
Stage
from 0.00% to <0.15%
17,293
0
16,008
33.6%
43
13%
9
577
from 0.15% to <0.25%
92,319
442
83,390
11.5%
124
28%
2
2,500
from 0.25% to <0.50%
244,399
0
225,910
17.2%
254
18%
3
6,334
from 0.50% to <0.75%
363,938
45,873
336,686
28.7%
203
16%
4
32,953
from 0.75% to <2.50%
1,397,861
140,617
1,297,718
30.1%
1,886
28%
4
108,125
from 2.50% to <10.0%
1,277,514
326,919
1,145,926
28.5%
20,728
32%
4
98,574
from 10.0% to <45.0%
586,712
59,035
527,825
40.8%
4,843
39%
4
86,976
from 45.0% to <100.0%
7,824
0
7,304
45.8%
25
34%
6
3,726
POCI
from 0.25% to <0.50%
-
123,836
-
-
-
-
-
-
from 0.50% to <0.75%
-
-
-
-
-
-
-
-
from 0.75% to <2.50%
-
680
-
-
-
-
-
-
from 2.50% to <10.0%
-
3,320
-
-
-
-
-
-
from 10.0% to <45.0%
-
-
-
-
-
-
-
-
from 45.0% to <100.0%
5,382
-
4,818
11.0%
407
50%
2
174
31.12.2022 Time in default
EAD after credit risk
mitigation
and use of credit
conversion factor
Number
of exposures
Average LGD
in %
Expected Credit Loss (ECL)
Stage 3
up to 12 months
851,145
17,292
29%
396,046
from 13 to 24 months
409,389
15,056
54%
272,418
from 25 to 36 months
332,435
5,925
41%
232,424
from 37 to 48 months
337,989
4,069
34%
248,722
from 49 to 60 months
102,776
2,550
78%
96,223
from 61 to 84 months
364,944
1,540
19%
158,756
above 84 months
444,965
896
7%
320,862
POCI
up to 12 months
248,234
1,612
3%
30,315
from 13 to 24 months
38,832
1,697
28%
27,117
from 25 to 36 months
23,941
1,080
38%
12,827
from 37 to 48 months
164,663
1,161
7%
78,940
from 49 to 60 months
49,376
921
20%
15,139
from 61 to 84 months
14,821
350
70%
14,813
above 84 months
53,623
244
20%
44,047
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
126
Diversification of the credit portfolio
The purpose of the Group’s policy on the concentration of risk-generating debt of one entity or entities linked capital- or organisation-wise is to minimise
concentration risk by, among other things, applying stricter standards than those provided for in the Banking Law Act. The policy helps the Group to
maintain high diversification of exposures to customers.
The Group’s lending policy also assumes sectoral diversification of credit delivery to reduce the risk of excessive exposures to entities from a particular
sector.
Manufacturing
18%
Information and
communication
4%
Real estate activities
12%
Transport and
storage
8%
Other services
6%
Agriculture, forestry
and fishing
5%
Wholesale and retail
trade
18%
Construction
4%
Other
13%
Administrative and
support service
activities
4%
Professional, scientific and
technical activities
8%
Diversification of consolidated loans and advances to customers
by business sector as at 31.12.2023
Credit portfolio quality
> Santander Bank Polska Group’s loans and advances by stages
Loans and advances to customers measured at amortised cost (PLN m)
31.12.2023
31.12.2022
Stage 1
Gross value
146,042.3
139,572.7
Expected credit loss allowance
(679.8)
(677.5)
Stage 2
Gross value
8,710.4
8,243.5
Expected credit loss allowance
(777.6)
(775.3)
Stage 3
Gross value
6,674.0
6,921.7
Impairment allowance
(3,977.3)
(4,274.2)
POCI
Gross value
810.0
779.7
Expected credit loss allowance
(165.2)
(150.3)
Total gross loans and advances
162,236.6
155,517.6
Expected credit loss allowance
(5,599.9)
(5,877.3)
Net loans and advances to customers measured at amortised cost
and finance lease receivables
156,636.7 149,640.3
NPL ratio
4.61%
4.95%
NPL coverage ratio
55.4%
57.5%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
127
Santander Bank Polska S.A. loans and advances by stages
5. Market risk and liquidity risk management
Market risk
Market risk is defined as an adverse earnings impact of changes in interest rates, FX rates, share quotations, stock exchange indices, etc. It arises both in
trading and banking activity (FX products, interest rate products, index-linked products).
Market risk within the operations of the Bank and Santander Bank Polska Group is associated mainly with customer service operations, transactions
effected to maintain liquidity in the money market and the capital market as well as proprietary trading in debt, FX, interest rate and equity instruments.
The key objective of the market risk policy adopted by the Bank and the Group is to reduce the impact of interest and FX rates movements on the Group’s
profitability and market value as well as to increase income within strictly defined risk limits and to ensure the Group’s liquidity.
Market risk management
The Market and Investment Risk Committee approves market risk management strategies and policies as well as limits that define the maximum
acceptable exposure to individual risk types, in accordance with the Risk Appetite Statement.
The Management Board takes its strategic decisions on the basis of recommendations from the Market and Investment Risk Committee, to which direct
supervision of market risk management has been delegated.
ALCO – supported by the Financial Management Division – is responsible for managing market risk in the banking book, while the market risk in the
trading book is managed by the Corporate and Investment Banking Division. Santander Brokerage Poland, a unit of the Retail Banking Division, is
responsible for managing equity risk.
Identification and assessment of market risk
Interest rate and FX risks associated with the banking book are managed by the Financial Management Division, which is also responsible for managing
open positions in interest rate and FX risks of companies from Santander Bank Polska Group.
The responsibility for measurement, monitoring and reporting of market risk and compliance with risk limits is vested in the Risk Management Division,
which is responsible for regular reviews of market risk exposure and reporting results to the Market and Investment Risk Committee. This role is
performed by the Financial Risk Department in the Risk Management Division, which is responsible for ongoing risk measurement, implementation of
control procedures and risk monitoring and reporting. The Department is also responsible for formulating the market risk policy, proposing risk
measurement methodologies and ensuring consistency of the risk management process across the Group.
Loans and advances to customers measured at amortised cost (PLN m)
31.12.2023
31.12.2022
Stage 1
Gross value
130,084.3
124,238.2
Expected credit loss allowance
(450.3)
(433.1)
Stage 2
Gross value
6,374.1
6,140.7
Expected credit loss allowance
(562.1)
(534.3)
Stage 3
Gross value
4,742.8
4,945.9
Impairment allowance
(2,690.7)
(2,898.3)
POCI
Gross value
724.9
737.9
Expected credit loss allowance
(129.3)
(135.0)
Total gross loans and advances
141,926.1
136,062.7
Expected credit loss allowance
(3,832.4)
(4,000.7)
Net loans and advances to customers measured at amortised cost
138,093.8
132,062.0
NPL ratio
3.85%
4.18%
NPL coverage ratio
51.6%
53.4%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
128
With the division of roles, management of risk in the banking book is fully separate from the management of risk in the trading book, and the risk
measurement and reporting functions are separate from the risk managing and taking units.
The market risk management policies adopted by the bank and the Group set out a number of measures in the form of obligatory and watch limits and
ratios. The limits are reviewed and the market risk appetite is updated on an annual basis. The process is coordinated by the Financial Risk Department
in the Risk Management Division.
To control the banking book risk, the following maximum sensitivity limits have been set for the risk of interest rate changes:
NII sensitivity limit (i.e. the sensitivity of net interest income to a parallel shift of the yield curve by 100 bp);
MVE sensitivity limit (the sensitivity of the market value of equity to a parallel shift of the yield curve by 100 bp).
> Sensitivity of the banking book to interest rate movements as at 31 December 2023 and 31 December 2022
1-day holding period
(PLN k)
Net interest income (NII) sensitivity
Market value of equity (MVE) sensitivity
31.12.2023
31.12.2022
31.12.2023
31.12.2022
Maximum
(342)
(426)
(722)
(595)
Average
(280)
(358)
(380)
(488)
At the end of the period
(147)
(334)
(644)
(494)
Limit
(500)
(900)
(925)
(800)
In 2023, the utilisation of the NII sensitivity decreased, while the utilisation of the MVE sensitivity increased YoY. RED status was not observed for
operational limits. In the case of MVE, the exposure increased due to the delivery of the strategy aimed at hedging interest rate sensitivity, which resulted
in a longer duration of the banking book. The above strategy was mainly based on cash flow hedges and expansion of the ALCO portfolio with fixed-rate
debt securities.
The Bank and Santander Bank Polska Group use the following measures and limits to mitigate and control exposure to market risk in the trading book:
daily VaR limit and Stressed VaR limit for interest rate risk, FX risk and the repricing risk of equity instruments held by Santander Brokerage
Poland;
PV01 limit set for individual currencies and transaction repricing dates;
stop-loss mechanism used to manage the risk of loss on trading positions subject to fair value measurement through profit or loss;
maximum limit of the total FX position and an open position for individual currencies;
intraday FX position limits monitored in the trading and banking books.
As these measures relate to the calculation of a potential loss under normal market conditions, the Bank and Santander Bank Polska Group also use stress
tests which show the estimated potential losses in the event of the materialisation of adverse market conditions.
> VaR as at 31 December 2023 and 31 December 2022 for interest rate, currency and equity risk in the trading book of Santander Bank
Polska Group
1-day holding period
(PLN k)
Interest rate risk
VaR
Currency risk
VaR
Equity risk VaR
31.12.2023 31.12.2022 31.12.2023 31.12.2022 31.12.2023 31.12.2022
Average
7,443
5,321
749
1,021
379
261
Maximum
14,049
14,622
2,411
2,346
759
532
Minimum
3,258
960
81
68
112
98
At the end of the period
6,953
9,550
648
1,144
424
258
Limit
13,812
13,205
3,542
3,301
1,574
2,135
In 2023, limits related to the total VaR and interest rate risk VaR for the Bank’s trading book were exceeded three times in Q4, as a result of day-to-day
operations and transactions in debt and interest rate instruments made by the Bank’s customers. The breaches were immaterial and were closed on the
day they were identified, in accordance with the rules for managing risk in the trading book. The average VaR increased YoY due to higher volatility of risk
factors and an organic growth of the Bank’s business. The maximum interest rate risk of the Bank’s trading book did not change significantly compared
to the last year.
In 2023, the VaR limit for currency risk and equity risk was not exceeded.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
129
Financial instruments used for management of market and other risks
The Bank and the Group use the following financial instruments in relation to repricing risk, credit risk, cash flow risk and liquidity risk:
derivative instruments held for trading – proprietary transactions in connection with treasury services rendered to bank customers in order to
mitigate market risk, maintain liquidity or as part of underwriting services;
other financial instruments, including investment securities held for sale, hedging derivatives and equity instruments.
The market risk associated with open positions in financial instruments is mitigated through a set of limits (defined separately for the trading book and
the banking book). The credit risk of such positions is curbed using concentration limits in respect of individual counterparties. In order to mitigate liquidity
risk, the Bank and the Group keep an adequate level of liquid financial assets bearing low credit risk (in particular government bonds and NBP bills) in
line with the liquidity risk appetite defined by the Bank and the Group.
No derivative instruments were used by the Bank or the Group to hedge credit risk.
The market risk of the balance sheet is managed by the Bank and the Group using, inter alia, derivative instruments and hedge accounting with respect
to:
mortgage loans bearing WIBOR rate – interest rate swaps are used to receive fixed interest and pay floating interest thus hedging the risk of
movements in cash flows relating to floating interest loans;
mortgage loans in CHF and EUR – basis swaps are used to hedge the risk of movements in interest rates (CHF LIBOR, EURIBOR) and exchange rates
(CHF/PLN and EUR/PLN);
fixed interest cash loans – interest rate swaps are used to receive floating interest and pay fixed interest thus hedging the fair value of positions;
selected fixed coupon bonds – interest rate swaps are used to hedge the fair value of bonds whereby the bank and the Group receive floating
interest and pay fixed interest.
Liquidity risk
Liquidity risk is the risk of failure to meet contingent and non-contingent obligations made to customers and counterparties.
The liquidity risk policy adopted by the Bank and the Group is to ensure that all outflows expected in the short term are fully covered by anticipated
inflows or liquid assets. In addition, the aim of the policy is to ensure an appropriate structure of funding for the Bank’s and the Group’s operations by
maintaining medium- and long-term liquidity ratios at a pre-defined level and monitoring stress testing results. This policy covers all assets and liabilities
as well as off-balance sheet items impacting the liquidity level.
Liquidity risk management
ALCO and the Market and Investment Risk Committee have overall responsibility for the supervision of liquidity risk on behalf of the Management Board.
As part of their roles, they make recommendations to the Management Board on appropriate strategies and policies for strategic liquidity management.
Liquidity risk reports and stress test results are regularly reviewed by senior management.
ALCO also supervises the liquidity management process in subsidiaries.
Liquidity management is the responsibility of the Financial Management Division, which develops and updates relevant strategies and reviews the
Contingency Liquidity Plan (approved by the Management Board and the Supervisory Board). The Risk Management Division is responsible for the
independent measurement and reporting of liquidity risk and for defining liquidity risk management policies. The Financial Risk Department in the Risk
Management Division also performed regular stress tests with respect to liquidity.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
130
Identification and assessment of liquidity risk
Liquidity risk is identified and measured daily, mainly using modified liquidity gap reports, intraday liquidity reports and regulatory reports. These reports
cover a number of internal and regulatory limits. Cyclical liquidity measurement reports are supported by stress test results. The Bank regularly calculates
the measures laid down in CRD IV/CRR (LCR and NSFR).
> Cumulative liquidity gap for Santander Bank Polska S.A. as at 31 December 2023 and in the comparative period (by nominal value)
31.12.2023 (PLN k)
Payable on
demand
up to 1
month
from 1 to 3
months
from 3 to 6
months
from 6 to 12
months
from 1 to 2
years
from 2 to 5
years
above 5
years
Contractual liquidity gap
(120 735 036)
(2 055 443)
(7 643 670)
4 647 800
12 283 154
31 964 553
59 433 713
64 127 954
Cumulative contractual liquidity
gap
(120 735 036)
(122 790 479)
(130 434 149)
(125 786 349)
(113 503 195)
(81 538 642)
(22 104 929)
42 023 025
Net derivatives
-
(39 544)
144
-
(12 104)
(1 380)
-
-
31.12.2022 (PLN k)
Payable on
demand
up to 1
month
from 1 to 3
months
from 3 to 6
months
from 6 to 12
months
from 1 to 2
years
from 2 to 5
years
above 5
years
Contractual liquidity gap
(114,674,520)
(3,757,323)
(3,925,909)
4,855,245
6,703,745
30,987,858
53,635,031
61,037,340
Cumulative contractual liquidity
gap
(114,674,520)
(118,431,843)
(122,357,752)
(117,502,507)
(110,798,762)
(79,810,904)
(26,175,873)
34,861,467
Net derivatives
-
-
-
-
-
( 42,977)
-
-
According to the Group’s policy, the Bank should have sufficient funds to cover in full outflows expected over a one-month horizon, including under the
selected stress test scenarios. The liquidity position over a longer time horizon and the level of liquid assets are also monitored.
In 2023, the Bank’s funds significantly exceeded the level required to cover the expected outflows. The Bank also met the regulatory quantitative
requirements for liquidity. Key regulatory indicators (LCR and NSFR) exceeded the required levels.
6. Operational risk management
Santander Bank Polska S.A. adopted the definition of operational risk provided by the Basel Committee on Banking Supervision, according to which
operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.
The objective of operational risk management is to minimise the likelihood and/or reduce the impact of unexpected adverse events.
Santander Bank Polska Group has an integrated operational risk management framework ensuring that all risks having material impact on its operations
are identified, measured, monitored and controlled. Operational risk management at the Bank and Santander Bank Polska Group is the task of employees
at all levels of the organisation and covers a number of interrelated concepts. Operational risk is inherent in all Bank’s and Group’s business processes,
including outsourced functions or services delivered jointly with third parties.
The Bank and other Group members have developed and apply the Operational Risk Management Strategy.
The Operational Risk Management Committee (ORMCO) established by the Management Board is responsible for setting operational risk management
standards for Santander Bank Polska Group. ORMCO is the main forum for discussions on operational risk and internal control. It sets the strategic
direction for operational risk management, determines and monitors objectives for managing operational risk, including business continuity, information
security, outsourcing/ insourcing and fraud prevention. The results of ORMCO’s work are reported to the Risk Control Committee.
In view of the growing global cyber threat, the Bank has the CyberTechRisk Forum, which is responsible for analysing, monitoring and – in some cases –
approving key issues related to IT, cybersecurity and operations. The main role of the Forum is to review the strategy and development directions of IT
and cybersecurity as well as to monitor technological and operational risks, including cyber risk.
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Tools used by the Bank and the Group to manage operational risk
Identification and
assessment of
operational risk
As part of the Risk Control Self-Assessment, the Bank and Santander Bank Polska Group identify the risks they may be
exposed to when delivering their functions, assess inherent and residual risks in terms of their likelihood and impact, and
verify the design and effectiveness of existing controls as part of the assessment of the internal control system.
The process of identification and assessment of operational risk is additionally supported by such tools as: scenario analysis,
business impact analysis and an analysis of risk in new initiatives.
Reporting
Each organisational unit must report operational risk events identified in its area of responsibility. In addition, relevant
operational risk events are escalated to senior management using a fast-track procedure.
Santander Bank Polska Group runs a database of operational risk events identified across the organisation. The data are used
to analyse the causes and consequences of operational risk events, facilitate the lessons learned process and implement
remedial and preventive actions.
The Group also makes inputs to the external database of operational risk events run by the Polish Bank Association (ZBP)
and uses information about external events from a number of sources. The analysis of external events enables benchmarking
and lesson learning from events identified outside the Group.
Analysis of risk
indicators
Santander Bank Polska Group monitors financial, operational and technological risk indicators. They provide an early warning
of emerging threats and support the monitoring of an operational risk profile.
Defining mitigation
actions
The process of managing operational risk mitigants is designed to eliminate or reduce operational risk. Risk mitigation
measures are determined based on the results of analyses carried out using various operational risk tools (including
operational risk events database, risk indicators, risk self-assessment, analysis of the control environment).
Business continuity
management (BCM)
Each organisational unit must develop and update its business continuity management plan to ensure that critical business
processes remain uninterrupted following an unplanned disruption. BCM plans are tested on a regular basis to provide
assurance to Santander Bank Polska Group that critical business processes may be restored at the required service level and
within the agreed time frame. Santander Bank Polska Group has backup locations where critical processes can be restored
and continued if a special situation occurs.
Information security
Santander Bank Polska S.A. has the Information Security Management System in place, which is certified for compliance with
the ISO/IEC 27001:2013 standard. The purpose of this system is to supervise information security in Santander Bank Polska
Group’s business environment, and assess specific information and system security requirements.
Insurance
Santander Bank Polska Group has financial risks, motor, property and professional indemnity insurance policies in place to
mitigate operational risk.
Reporting to the Risk
Control Committee
and the Supervisory
Board
The aim of operational risk reporting is to provide up-to-
date and appropriate information to the management team.
Operational risk reports include details on operational risk events and losses, information security incidents, risk indicators
and defined mitigants.
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7. ESG risk management
Climate-related risk
Appropriate identification of risks and opportunities related to climate transition allows Santander Bank Polska Group to take measures to increase
resilience to negative climate factors and to leverage positive factors to accelerate growth, improve financial results and build reputation of the Bank and
the Group.
The Bank and its affiliates considered climate-related risks when preparing financial statements in accordance with the International Financial Reporting
Standards and elsewhere as necessary. The IFRSs were applied with due regard to that matter.
Specifically, the impact of environmental issues on the Bank and its affiliates was considered in the context of the application of:
IAS 1 Presentation of Financial Statements
IAS 12 Income Taxes
IAS 36 Impairment of assets
IFRS 9 Financial Instruments
IFRS 13 Fair Value Measurement
IAS 37 Provisions, Contingent Liabilities and Contingent Assets.
The conducted analysis concluded that environmental issues do not have any significant impact on the financial statements as a whole.
In 2023, the Bank analysed the sensitivity of the portfolio to climate risks, taking into account the sensitivity assessment of the most exposed sectors
covered by the portfolio. The analysis was made in three time horizons: short (2030), medium (2040) and long (2050). Unlike in the previous years, this
time the analysis was based on climate scenarios defined by the Network for Greening the Financial System (NGFS), a group of central banks and
supervision authorities with more than 130 members (including the biggest institutions such as the European Central Bank, the Bank of England and the
US Federal Reserve System) determined to ensure a better understanding and management of climate risks.
The Group considered physical and transition risks in the 11 sectors in which Banco Santander customers are active and which are exposed most to climate
risks. Nine out of those 11 sectors are materially represented in the portfolio of Santander Bank Polska S.A.
In line with the approach recommended by the TCFD, the main types of risks from both categories (physical risks and transition risks) were considered
during the analysis. In 2023, the methodology used to assess climate risks was improved (the methodology for assessing the materiality of risks for
sectors is described in the section on risk management: risk materiality analysis). The risk was graded on a 1 to 5 scale, with 1 representing very low risk
and 5 – very high risk. The analysis was qualitative, but it included the concept of double materiality: it considered both the channels of the Bank’s impact
on climate change and the impact of climate change on the Bank’s performance. The methodology and scope of this analysis are being constantly
developed to more accurately reflect the impact of climate risks on the Bank’s portfolio.
Physical risks
The sources of physical risks are among other things extreme weather conditions such as severe storms or floods which may cause infrastructure
disruption or damage in many sectors. Due to the nature of its activities, the agri sector is particularly exposed to physical risks, with an increased risk of
soil erosion affecting crop quality and yields.
In a medium and long term, there is a physical risk related to deteriorating hydrological conditions in Poland and the risk of drought. Water scarcity and
the lack of relevant retention systems may adversely affect the economy, including the energy sector. For example, the CHP plants that use river water
for cooling purposes may be forced to limit energy production during drought. Fire risk is also identified in the soft commodities sector, e.g. risk of
potential losses caused by fire in wood production.
Transition risks
The most sensitive sectors in the context of transition to a low-carbon economy are the sectors based on coal and other fossil fuels that dominate the
Polish energy mix. There are regulatory and legal risks connected with higher costs of CO
2
emissions, more stringent data reporting and gathering
requirements as well as regulatory changes that may limit the operations of some high-carbon businesses.
Regulatory risks also involve law amendments imposing more climate-friendly solutions, which may result in higher operating costs for some companies.
For example, in the automotive sector, decreasing costs of electric cars and the expected EU regulations may result in stranded assets in the petrol car
supply chain. Market competition may force companies from the Group’s portfolio to invest in more innovative vehicles.
Santander Bank Polska Group also identified market risks resulting from the impact of climate change on market variables, including consumer
preferences, interest rates and commodity prices. Reputational risks connected with an increased consumer awareness are important too. The above
risks may affect the Group’s position, both directly and through its customers.
The same exercise was conducted with respect to climate-related opportunities. The transition to a green economy allows Santander Bank Polska Group
to help existing and future customers as well as to support economic transformation by providing relevant financing solutions. In view of the above, the
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Group intends to continue to develop new products and services (including advisory services for customers) and earn a reputation of a trusted partner.
Opportunities for the Group were identified as part of the analysis.
The climate-related opportunities and risks identified by Santander Bank Polska Group have an impact on financial instruments and are included in the
Group’s main risk management processes. The impact of climate change on the Group’s business has been defined on a high level but further analysis
will be made to quantify the influence of those risks and opportunities in more detail.
Responsibility for ESG risk management
According to the internal allocation of powers in the Management Board (Management Board Resolution no. 221/2023 and Supervisory Board Resolution
no. 145/2023), the responsibility for the management of significant risk in the Bank’s business rests with Andrzej Burliga, Vice President of the
Management Board in charge of the Risk Management Division, which includes the ESG Risk Management Office.
In addition, on 27 October 2023 the Management Board adopted Resolution no. 214/2023 determining the following division of responsible banking
(ESG) tasks and responsibilities:
ESG risk management – Vice President of the Management Board in charge of the Risk Management Division
Green finance – Member of the Management Board in charge of the Business and Corporate Banking Division
Coordination of the Group’s responsible banking activities, including ESG qualitative reporting – Head of the Corporate Communication and
Marketing Area outside the divisional structure
ESG quantitative reporting – Member of the Management Board in charge of the Financial Accounting and Control Division.
When taking decisions, the Management Board considers assessments, information and analyses of the ESG risk management unit. Based on that, it
adopts the Risk Appetite Statement, which is then approved by the Supervisory Board. Specific limits are used to set watch limits and define risk
management policies. The Management Board member in charge of risk management provides the Supervisory Board members with relevant
information about risk to ensure they have a full picture of the Bank’s risk profile and can make informed decisions in this respect.
The Supervisory Board verifies the Bank’s management strategy and ESG risk management strategy, also in terms of the Bank’s long-term interest. When
taking decisions, the Supervisory Board also considers assessments, information and analyses of the risk management unit.
The Bank also has the Responsible Banking and Corporate Culture Committee, which provides support to the Bank’s Management Board in the oversight
of the responsible banking and sustainability strategy both locally and at the level of Santander Bank Polska Group. The Committee, which is chaired by
the President of the Management Board, defines the strategy and annual goals related to ESG and ensures compliance with environmental and social
policies of Santander Bank Polska S.A. The Committee is supported by the ESG Forum composed of senior managers representing all Divisions. The Forum
analyses challenges, opportunities and risks related to the EU Sustainable Finance agenda (including ESG risks), plans activities and coordinates their
implementation at the Bank, and submits regular reports to the Responsible Banking and Corporate Culture Committee and the Bank’s Management
Board.
The Bank does not recognise ESG risk as a separate material risk, but indicates its channels of transmission to credit, compliance, reputational, business,
and operational risks.
That was the conclusion of the annual material risk identification and update process, which took place in Q1 2023. The above approach affects how
material risks are estimated and quantified. ESG risk is also considered in an annual risk profile assessment.
The Bank defined the criteria for identification, monitoring and management of social and environmental risk. They are detailed in the Environmental,
Social and Climate Change Risk Management Policy, which was updated in 2023.
Specifically, implementing procedures for the ESG risk analysis were defined. The purpose of the ESG risk assessment is to estimate the capability of a
customer to manage all types of ESG risk, enabling a more detailed analysis of the impact of the underlying activities that are directly supported by
financial products or services provided by the Bank:
Investment and Corporate Banking customers are subject to the procedure: “Environmental, Social and Climate Change Risk Screening”.
Business and Corporate Banking customers are subject to the procedure: “Environmental and Social Risk Screening of B&CBD Customers”.
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8. Legal and compliance risk management
Legal risk management
Operating in the complex legal and regulatory environment, the Bank and Santander Bank Polska Group are exposed to the risk of misapplication or
misinterpretation of legal provisions, regulatory requirements, industry codes and ethical codes adopted by the Bank, as well as internal policies and
procedures (including codes of best practice). Non-compliance might expose the Bank to loss of reputation or to administrative or criminal sanctions.
The management and control of compliance risk includes application of controls, independent monitoring of their execution and reporting. The control
function is performed under three lines of defence:
Pursuant to the Compliance Policy, Santander Bank Polska S.A. has a compliance function which is independent of business units. This function acts as
the second line of defence by setting and enforcing compliance standards, providing advice and reporting in the interest of employees, customers,
shareholders and the public.
The compliance function supports the Bank’s strategy with respect to managing regulatory risk, conduct risk and reputational risk. Its activity is
determined by the Bank’s business profile: it carries out tasks related to the protection of consumer rights and to ongoing digitalisation and
standardisation of financial services.
In particular, the compliance function is responsible for:
independent identification, monitoring and assessment of compliance risk that the Group is exposed to (with particular focus on new products
and services, prevention of using the financial system for the purpose of money laundering and terrorist financing, protection of confidential
information, management of conflicts of interest and private account share dealing by employees);
providing advice and reporting to the Risk Management Committee, the Bank’s Management Board and the Audit and Compliance Committee
on the effectiveness of processes established to ensure compliance with legal and regulatory requirements;
communication of policies and procedures, providing the management and staff with guidance on compliance risk management;
coordination of contacts with market regulators (KNF, UOKiK, GIIF, UODO);
coordination of the approval of new products;
strengthening the principles of ethical business conduct;
cooperation with the Corporate Communication and Marketing Area and the Risk Management Division in terms of reputational risk
management.
cooperation with the Anti-Money Laundering and Terrorist Financing Department in matters related to money laundering and terrorist
financing risk.
The compliance function also coordinates the activities of committees supporting compliance risk management processes in particular areas of the Group:
General Compliance Committee
Regulatory and Reputational Risk Committee
Local Marketing and Monitoring Committee
These committees are composed of representatives of key organisational units that have the necessary expertise and authority to ensure that relevant
decisions are taken and high quality advice is provided in the course of the proceedings.
Employees of the compliance function support the Bank’s senior management in effective compliance risk management and report on key compliance
issues to the Bank's Management Board, the Risk Management Committee and the Audit and Compliance Committee of the Supervisory Board.
The Management Board and the Supervisory Board (through the Audit and Compliance Committee) regularly review key compliance issues identified by
the compliance function. The review particularly includes:
product monitoring
test compliance monitoring
monitoring of employees’ own trades
information on the activity of market regulators
First line of defence:
Management of risk arising
from the Bank’s operations
Second line of defence:
Ongoing vertical verification
and vertical testing
Third line of defence:
Internal audit function
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review of upcoming legislative initiatives
review of anti-money laundering issues
review of ethical issues
review of customer complaints.
In February 2023, the Bank’s Supervisory Board positively assessed the effectiveness of compliance risk management at Santander Bank Polska S.A.,
based on a positive recommendation of the Audit and Compliance Committee.
In addition to the compliance function, the second line of defence also includes other organisational units operating under internal regulations, in
particular:
responsibilities related to anti-money laundering and terrorist financing – AML unit
labour law responsibilities – personnel unit
companies and partnerships law responsibilities – corporate governance unit
occupational health and safety responsibilities – health and safety unit
accounting, reporting and tax responsibilities – financial, accounting and tax units
prudential requirements – risk units.
Reputational risk management
Reputational risk is defined as the risk of actual or potential adverse impact on the Bank connected with deterioration of perception of the Bank and other
members of Santander Bank Polska Group by customers, employees, regulators, shareholders/ investors and communities at large.
Potential sources of this risk are internal operational incidents and external events, such as adverse publicity, dissemination of negative feedback by
customers, e.g. via the Internet, in social media and other mass media. They may refer directly to Santander Bank Polska Group and its products and
services, as well as the Bank’s shareholders and the entire banking or financial sector (both domestic and international).
The elements of reputational risk also include customer complaints and claims related to the process of offering banking products and services (both
directly and through third parties/ suppliers/ intermediaries), including complaints about the lack of sufficient (i.e. complete, true, reliable and non-
misleading) information about products/ services and related risks, the complexity of products, failures of systems and applications, misselling, capital
loss, as well as establishment of relationships with entities considered to be sensitive due to the type and profile of their business (high risk sectors).
The management of reputational risk is the responsibility of the Corporate Communication and Marketing Area and the Compliance Area.
The objective of reputational risk management is to protect the image of Santander Bank Polska Group and to limit and eliminate negative events which
affect the image and financial results of the Group.
The key risk mitigation measures include:
Disclosure Policy of Santander Bank Polska S.A.
Reputational risk management model consisting of: the Reputational Risk Management Policy, the Reputational Risk Management Procedure
and the Methodology for Reputational Risk Management at Santander Bank Polska S.A.
Reputational Risk Analysis Procedure and Guidelines of Santander Bank Polska S.A.
Guidelines on cooperation with partners at Santander Bank Polska S.A.
Sensitive Sector Financing Policy of Santander Bank Polska S.A.
Defence Sector Policy of Santander Bank Polska S.A.
Guidelines: “Criteria for reputational risk analysis of customers and transactions”
Donation Policy of Santander Bank Polska Foundation and Donation Policy of Santander Bank Polska S.A.
Daily monitoring of local, nationwide and selected international mass media sources (Corporate Communication and Marketing Area)
Social Media Policy of Santander Bank Polska S.A. (Corporate Communication and Marketing Area)
Daily monitoring of social media sources (in particular: Facebook, Twitter) in terms of references to the Bank (Corporate Communication and
Marketing Area)
Analysis of image-sensitive information by the Press Office (Corporate Communication and Marketing Area)
Response to information which poses a threat to public perception of the Bank (Corporate Communication and Marketing Area)
Keeping the representatives of national and local media posted on new products and changes to regulations regarding existing products
Regular monitoring of reputational risk events and reputational risk profile (Compliance Area)
Monitoring of changes in laws, internal regulations and market standards as well as abusive clauses in contracts (Compliance Area)
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Customer satisfaction survey (Chief Customer Officer)
Recommendations and preventive actions arising from the analysis of complaints (Chief Customer Officer)
Preparation and control by relevant units of Santander Bank Polska S.A. of all important communications and reports for shareholders, the
Polish Financial Supervision Authority (KNF) and the Warsaw Stock Exchange, and timely publication of such communications and reports
Evaluation of new products/ services or their modifications, and the related procedures, communications, commercial materials, initiatives
addressed to customers (promotions, contests) and training materials for sales staff in terms of their compliance with laws and regulatory
guidelines, ethical business conduct, ESG matters and reputational risk (Compliance Area)
Participation in the management of customer complaints, especially those filed with regulators (Compliance Area)
Supervision of post-sales control of investment products (Compliance Area)
Mystery shopping
Regular monitoring of reputational risk associated with products/ services offered by Santander Bank Polska Group through the analysis of
customer complaints, sales volumes, number of customers and rate of return, if applicable (Compliance Area)
Periodic monitoring of customers and transactions in terms of compliance with applicable reputational risk management policies and
procedures
Reviewing agreements with external suppliers and third parties (in particular the ones regarding outsourcing, critical services and high-risk
services)
Participation in the analysis of customers and transactions from sensitive sectors (including defence, gambling, tobacco, media and cannabis
industries) (Compliance Area).
Participation in the analysis of customers and transactions from other sectors in the case of identification of reputational risk
Participation in the ESG Panel to ensure proper identification and classification of transactions in terms of compliance with SFCS and EU
Taxonomy to prevent greenwashing risk.
9. Capital management
Introduction
The policy of Santander Bank Polska Group is to maintain a level of capital adequate to the type and scale of operations and the level of risk.
The level of own funds required to ensure safe operations of the Bank and Santander Bank Polska Group and capital requirements estimated for
unexpected losses is determined in accordance with the provisions of the CRD IV/CRR package, regulations of the European Parliament and of the Council
(EU) (2019/876 of 20 May 2019, 2019/630 of 17 April 2019, 2020/873 of 24 June 2020), and the Polish Macroprudential Supervision Act, taking into
account KNF recommendations.
The Management Board is accountable for capital management, calculation and maintenance processes, including the assessment of capital adequacy
in different economic conditions and the evaluation of stress test results and their impact on internal and regulatory capital and capital ratios.
Responsibility for the general oversight of internal capital estimation rests with the Supervisory Board.
The Management Board has delegated ongoing capital management to the Capital Committee which conducts a regular assessment of the capital
adequacy of the Bank and Santander Bank Polska Group, including in extreme conditions, the monitoring of the actual and required capital levels and the
initiation of transactions affecting these levels (e.g. by recommending the value of dividends to be paid). The Capital Committee is the first body that
defines the capital policy, principles of capital management and principles of capital adequacy assessment.
However, ultimate decisions regarding any increase or decrease in capital are taken by relevant authorities within the Bank in accordance with the
applicable law and the Bank’s Statutes.
In 2023, the Bank and Santander Bank Polska Group met all regulatory requirements regarding capital management.
As at 31 December 2023, the Group had a capital surplus of PLN 9.38bn above the regulatory requirements.
Santander Bank Polska Group does not consider the full impact of introduction of IFRS 9 for the purpose of capital adequacy assessment and applies
transitional arrangements provided for in Regulation (EU) 2017/2395 amending Regulation (EU) No 575/2013, updated in accordance with Regulation
(EU) 2020/873 of the European Parliament and of the Council of 24 June 2020. Based on the above-mentioned changes, the Group uses derogation in
the form of assigning a risk weight of 100% to the value of the adjustment included in own funds.
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Category measuring capital adequacy of Santander Bank Polska Group as
at 31 December 2023
Impact of transitional arrangements related to IFRS 9
Total own funds
+PLN 120,310k
Total capital ratio
+8 bps
Tier 1 capital ratio
+8 bps
Capital policy
As at 31 December 2023, the minimum capital ratios satisfying the provisions of the CRR and the Macroprudential Supervision Act as well as regulatory
recommendations regarding additional own funds requirements under Pillar 2 were as follows:
at the level of Santander Bank Polska S.A.:
9.87% for Tier 1 capital ratio
11.87% for total capital ratio
at the level of Santander Bank Polska Group:
9.880% for Tier 1 capital ratio
11.883% for total capital ratio.
The aforementioned capital ratios at the Bank and Group level take into account:
Group Bank
Components of the minimum capital requirement 31.12.2023 31.12.2022 31.12.2023 31.12.2022
Minimum capital ratios
Common Equity Tier 1 capital ratio
4.5%
4.5%
4.5%
4.5%
Tier 1 capital ratio
6%
6%
6%
6%
Total capital ratio
8%
8%
8%
8%
Additional capital requirement for risk
related to foreign currency mortgage
loans for households
Common Equity Tier 1 capital ratio
0.007 p.p. 0.009 p.p.
none
Tier 1 capital ratio
0.010 p.p. 0.012 p.p.
Total capital ratio
0.013 p.p. 0.016 p.p.
Capital buffer for Santander Bank Polska S.A. as other systemically important institution
1 p.p. 1 p.p. 1 p.p. 1 p.p.
Capital conservation buffer maintained in accordance with the Macroprudential
Supervision Act
2.5 p.p. 2.5 p.p. 2.5 p.p. 2.5 p.p.
Systemic risk buffer
0 p.p.
0 p.p.
0 p.p.
0 p.p.
The Bank’s sensitivity to an adverse macroeconomic scenario measured based on the
results of the regulatory stress tests (P2G)
0.37 p.p. 0.23 p.p. 0.37 p.p. 0.26 p.p.
To mitigate the risk of credit crunch arising from the Covid-19 pandemic, on 18 March 2020 the Minister of Finance issued a regulation based on the
recommendation of the Financial Stability Committee removing banks’ obligation to keep the systemic risk buffer of 3%.
Regulatory capital
The capital requirement for Santander Bank Polska Group is determined in accordance with Part 3 of Regulation (EU) No 575/2013 of the European
Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No
648/2012 (CRR), as amended by: CRR2, Regulation (EU) No 2020/873 of the European Parliament and of the Council of 24 June 2020 amending Regulation
(EU) No 575/2013, and (EU) 2019/876 as regards certain adjustments in response to the COVID-19 pandemic.
Santander Bank Polska Group uses the standardised approach to calculate the capital requirement for credit risk, market risk and operational risk.
According to this approach, the total capital requirement for credit risk is calculated as the sum of risk-weighted exposures multiplied by 8%. The exposure
value for these assets is equal to the balance sheet total, while the value of off-balance sheet liabilities corresponds to their balance sheet equivalent.
Risk-weighted exposures are calculated by applying risk weights to all exposures in accordance with the CRR.
The table below presents the calculation of the capital ratio for Santander Bank Polska Group as at 31 December 2023 and 31 December 2022.
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> Calculation of the capital adequacy ratio for Santander Bank Polska Group as at 31 December 2023 and 31
December 2022
Santander Bank Polska Group (PLN m) 31.12.2023
31.12.2022
restated data
1)
I
Total capital requirement (Ia+Ib+Ic+Id+Ie), including:
11,240.9 10,952.7
Ia
– for credit risk and counterparty credit risk
9,583.8 9,438.6
Ib
– for market risk
155.4 160.6
Ic
– for credit valuation adjustment risk
52.6 45.9
Id
– for operational risk
1,392.8
1,254.3
Ie
– for securitisation
56.3 53.4
II
Total capital and funds
2)
28,815.3 28,846.9
III
Deductions
2,741.3 1,820.8
IV
Capital and funds after deductions (II–III)
26,074.0 27,026.1
V
Capital ratio [IV/(I*12.5)]
18.56% 19.74%
VI
Tier 1 capital ratio
17.18%
18.02%
1) Including profits allocated to own funds pursuant to EBA guidelines.
> Calculation of the capital adequacy ratio for Santander Bank Polska S.A. as at 31 December 2023 and 31 December 2022
Santander Bank Polska S.A. (PLN m)
31.12.2023
31.12.2022
restated data
1)
I
Total capital requirement (Ia+Ib+Ic+Id), including: 8,903.4 8,716.9
Ia
– for credit risk and counterparty credit risk 7,567.0 7,513.9
Ib
– for market risk 154.4 158.5
Ic
– for credit valuation adjustment risk 51.9 45.2
Id
– for operational risk 1,105.9 975.3
Ie
– for securitisation 24.2 24.0
II
Total capital and funds
2)
26,608.0 26,880.4
III
Deductions 2,974.9 2,565.0
IV
Capital and funds after deductions (II–III) 23,633.1 24,315.4
V Capital ratio [IV/(I*12.5)] 21.24% 22.32%
VI Tier 1 capital ratio 19.62% 20.26%
1) Including profits allocated to own funds pursuant to EBA guidelines.
Pursuant to the Bank’s disclosure strategy, details about the level of own funds and capital requirements are presented in a separate report on capital
adequacy of Santander Bank Polska Group (“Information on capital adequacy of Santander Bank Polska Group as at 31 December 2023”).
Internal capital
Notwithstanding the regulatory methods for measuring capital requirements, Santander Bank Polska S.A. carries out an independent assessment of
current and future capital adequacy as part of the internal capital adequacy assessment process (ICAAP). The purpose of the process is to ensure that the
level and nature of own funds guarantee the solvency and stability of the Bank’s and the Group’s operations.
The capital adequacy assessment is one of the fundamental elements of the Bank’s strategy, the process of defining risk appetite and the process of
planning.
In the ICAAP the Group uses assessment models based on the statistical loss estimation for measurable risks, such as credit risk, market risk and
operational risk, plus its own assessment of capital requirements for other material risks not covered by the model, e.g. reputational risk and compliance
risk.
The internal capital for credit risk is estimated on the basis of risk parameters including the probability of default (PD) by Santander Bank Polska S.A.
customers and the loss given default (LGD).
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The Group performs an internal assessment of capital requirements, also under stressed conditions, taking into account different macroeconomic
scenarios.
Internal capital estimation models are assessed and reviewed annually to adjust them to the scale and profile of the business of Santander Bank Polska
S.A. and to take account of any new risks and the management’s judgement.
The review and assessment is the responsibility of the Bank’s risk management committees, including: the Capital Committee and the Model Risk
Management Committee.
Subordinated liabilities
Information on bond issue
Date of KNF consent
to allocate the bonds to the Tier
2 capital
Nominal value of the
issue allocated to
subordinated liabilities
Amendments (made in 2016) to the agreement under which subordinated bonds were issued
on 5 August 2010 and taken up by the European Bank for Reconstruction and Development
(including extension of the maturity date to 5 August 2025)
18.05.2017 EUR 100m
Issue of bonds of Santander Bank Polska S.A. on 2 December 2016
24.02.2017
EUR 120m
Issue of subordinated bonds of Santander Bank Polska S.A. on 22 May 2017 19.10.2017 EUR 137.1m
Issue of series F subordinated bonds of Santander Bank Polska S.A. on 5 April 2018 12.06.2018 PLN 1bn
The information on subordinated liabilities is also provided in Note 5 and in Note 35 to the Consolidated Financial Statements of Santander Bank Polska
Group for 2023.
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XIII. Statement on corporate governance in 2023
1. Corporate governance at Santander Bank Polska S.A.
Corporate governance sets out the rules for operation of the governing bodies, systems and processes at Santander Bank Polska S.A. Its objective is to
build good relationships with shareholders, customers and other stakeholders, and to increase effectiveness of internal oversight, key internal systems
and functions as well as statutory bodies. The corporate governance principles adopted by the Bank focus on professionalism and integrity of members
of the management and supervisory bodies, transparency and due care, which helps build trust in Santander Bank Polska Group, supports sustainable
development and increases credibility of the capital market in Poland.
The Bank’s corporate governance framework is based on applicable laws (in particular the Commercial Companies Code, the Banking Law Act and capital
market regulations) as well as the rules set out in Best Practice for GPW Listed Companies 2021, Principles of Corporate Governance for Supervised
Institutions issued by the Polish Financial Supervision Authority (KNF) and the Code of Banking Ethics. Since 1 January 2022, the Bank has complied with
Recommendation Z on internal governance in banks issued by the Polish Financial Supervision Authority (KNF).
In 2023, Santander Bank Polska S.A. adhered to all the rules set out in the amended Best Practice for GPW Listed Companies 2021 adopted by virtue
of Resolution no. 13/1834/2021 of the Supervisory Board of the Warsaw Stock Exchange dated 29 March 2021 and effective as of 1 July 2021.
Furthermore, the Bank applied all Principles of Corporate Governance for Supervised Institutions issued by the KNF on 22 July 2014.
In the reporting period, no departures from the above-mentioned regulations were reported.
The Bank has complied with the official corporate governance principles since 2002 when the first issue of best practice was published by the Warsaw
Stock Exchange (Best Practice for Public Companies 2002). It also follows best sector practice contained in the Banking Ethics Code developed by the
Polish Bank Association (ZBP).
The Bank has adopted the following internal regulations setting out in detail the corporate governance rules: the Group-Subsidiary Governance Model
and Guidelines for Subsidiaries, Specific Corporate Frameworks, Internal Governance Rules of Santander Bank Polska S.A., Corporate Governance Rules
of Santander Bank Polska Group, the General Code of Conduct and specific bylaws and policies e.g. the Disclosure Policy, the Conflict of Interest
Prevention Policy, the Code of Conduct in the Securities Markets, the Anti-Money Laundering Policy, the Anti-Corruption Programme and the
Sustainability Policy, the Code of Conduct in the Securities Markets, the Anti-Money Laundering Policy, the Anti-Bribery and Corruption Policy, the
Responsible Banking Model and the Responsible Banking and Sustainability Policy.
This Statement on corporate governance in 2023 has been prepared in accordance with § 70(6)(5) of the Finance Minister’s Regulation of 29 March 2018
on current and financial reports published by the issuers of securities and the rules of equal treatment of the information required by the laws of a non-
member state.
In accordance with Commission Recommendation of 9 April 2014 on the quality of corporate governance reporting (2014/208/EU), the section below
presents details on application of corporate governance rules regarding the topics of most importance for shareholders.
Pursuant to Article 5(2) of Directive (EU) 2022/2464 which obliges the Bank to follow reporting standards in respect of sustainable development
information presented in the report for the year started on 1 January 2024 and pursuant to Commission Delegated Regulation (EU) 2023/2772 of 31 July
2023 supplementing Directive 2013/34/EU of the European Parliament and of the Council as regards sustainability reporting standards (ERS Regulation),
the Bank has decided to disclose the selected additional information about corporate governance (required under the ERS Regulation) in this very
Statement on corporate governance.
Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies,
Disclosure Requirement GOV-2 – Information provided to and sustainability matters addressed by the undertaking’s administrative,
management and supervisory bodies,
Disclosure Requirement GOV-3 - Integration of sustainability-related performance in incentive schemes.
Irrespectively of its disclosure in Chapter XIV Statement on non-financial information and the ESG Report for 2023, the selected information presented in
this Statement was highlighted as disclosed by reference to the specific requirement arising from the ESRS2 standard (e.g. ESRS 2 – Disclosure
Requirement GOV-1 – The role of the administrative, management and supervisory bodies).
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Best Practice for GPW Listed Companies 2021
The Best Practice for GPW Listed Companies 2021 effective as of 1 July 2021 was adopted by virtue of Resolution no. 13/1834/2021 of the Supervisory
Board of the Warsaw Stock Exchange dated 29 March 2021.
The full text is available on the website of the Warsaw Stock Exchange
at:https://www.gpw.pl/pub/GPW/files/PDF/dobre_praktyki/DPSN21_BROSZURA.pdf
The above version of best practice was adopted by the Bank by way of Management Board Resolution no. 160/2021 of 21 July 2021, Supervisory Board
Resolution no. 108/2021 of 27 July 2022 and Resolution no. 33 of the General Meeting of Shareholders of 27 April 2022.
On 29 July 2021, the Bank published a report on application of the rules set out in Best Practice for GPW Listed Companies 2021 (it is available on the
Bank’s website at:
https://www.santander.pl/regulation_file_server/time20210729112136/download?id=163350&lang=pl_PL). The Bank has been strictly following all
these rules since then. The table below describes the delivery of initiatives which are of key importance to the Bank’s shareholders.
Chapter Important aspects of application of Best Practice for GPW Listed Companies 2021
Disclosure
policy, investor
communications
(Chapter 1)
The Bank has an effective and transparent disclosure policy in place in relation to shareholders, investors and analysts,
which is supported by modern communication tools. Pursuant to the Disclosure Policy of Santander Bank Polska S.A.
(available on the Bank’s website: https://www.santander.pl/relacje-inwestorskie/dokumenty-
korporacyjne#dokument=4
), the Bank actively communicates with its stakeholders in order to meet their information
needs, with particular activities adjusted to their profile.
The communication with capital market participants is based on the following rules:
Periodic reports (including information about the Bank’s sponsorship and corporate giving activities) are published at
the earliest possible date following the end of the reporting period. The market is informed in advance, via current
reports, about the planned dates of publishing reports.
Current reports providing information required by applicable laws are published at the dates specified therein.
Each year, the Bank organises four conferences to present analysts, investors and all the interested parties with
quarterly figures. They are broadcast online in Polish and English. To the extent permitted by law, the Bank answers
questions asked during the conferences and sent by email to the email address of the Investor Relations Director
(available on the Bank’s Investor Relations website).
The corporate website is available in Polish and English at:www.santander.pl and includes the Investor Relations tab
with all the information required to be published in accordance with law and Best Practice for GPW Listed Companies
2021.
The Bank also has a website dedicated to General Meetings, which is available at www.santander.pl/wza.
As part of open communication with the shareholders, the Bank (acting through the representatives of its governing
bodies) provides them with all answers and explanations, ensures the possibility to participate in the general meetings
by means of electronic communication and enables media representatives to join such meetings.
The Bank promptly replies to any questions about the published information, and in the case of questions from
investors concerning unpublished data, the Bank takes efforts to reply as soon as possible and no later than within 14
days (in accordance with laws and market standards).
The Bank participates in investor conferences organised by Polish and foreign brokerage companies.
The Bank publishes its financial results achieved in a given reporting period before the deadlines prescribed by law,
being one of the leaders in this respect among the companies listed on the Warsaw Stock Exchange.
The Bank’s Investor Relations service at www.santander.pl includes a section dedicated to Best Practice for GPW Listed
Companies, which contains all the required information such as: report on application of Best Practice for GPW Listed
Companies 2021, inf
ormation about the Supervisory Board committees and their composition and terms of reference,
information about changes in the share capital and transactions in shares, information about incentive plans, dividend
policy, questions asked by investors (along with answers), information about pay equality between men and women
(including measures taken to eliminate any gaps), the Group’s structure, schedule of corporate events, information
about shareholders, Statement on Non-Financial Information, information about the Diversity Policy, information
about members of the Bank’s governing bodies and the General Meeting, basic corporate documents, financial
statements (including presentations), development strategy, recommendations and analyses of rating agencies,
current reports, records of meetings with investors, channels of communication between investors and the Bank, and
information about mergers and acquisitions.
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Disclosure
policy, investor
communications
(Chapter 1)
On its website, the Bank publishes information about its strategy, including strategic directions and objectives, results
of actions taken to implement the strategy as well as financial and non-financial metrics.
The Bank’s strategy addresses ESG aspects, both environmental protection and social and employee matters, defining
precise metrics and taking into account sustainable development. The Bank publishes annual ESG reports on its
corporate website.
Environmental protection and climate factors are one of the pillars of the Responsible Banking agenda, which was part
of the Bank’s Safety & Trust strategic direction under the business strategy of the Bank for 2021–2023. For 2024-
2026, the Bank's Managem
ent Board adopted the “We Help You Achieve More” strategy based on three strategic
directions. They are described in the Introduction to the Strategy:
Helping our customers and employees prosper is our purpose and the foundation of our three-year strategy for 2024–
2026. Our actions are people-oriented: we focus on customers and employees. This is why relationships are the focal
point of our strategy. We want them to be long-lasting and based on trust. We aim to evoke positive emotions and
projecting the image of a Bank that is close to people. We believe that caring about the experience will make us stand
out on the market. This is what our first strategic direction – Total Experience – is about. We also know that positive
emotions and experience to a large extent depend on the interactions in the digital world. For this reason, with
increased determination, we follow the path of digital innovation offering our customers new possibilities in remote
channels and ensuring our employees simple and effective processes. This is what our second strategic direction –
Total Digitalisation – is about. Challenges we face as a Bank and society require a huge responsibility. And for us,
responsibility is not just theory but a rule that guides us in our daily operations. We consciously make ethical decisions,
keeping in mind our impact on the community and the environment. With a sustainable business model, we create
value for customers, employees, shareholders and local communities, working towards a better future for our children
and our planet. This is what our third strategic direction – Total Responsibility – is about.
The metrics include, among other things, the share of energy bought from renewable sources (100%), the share of
used single-use plastics (0% since 2020) or the share of green financing in line with the Sustainable Finance
Classification System. This regulation was implemented at the Bank in order to set up the criteria for identification and
classification of transactions as sustainable (it is available at https://www.santander.pl/aktualnosci/aktualnosci-
lista/eko-rozwiazania). It is based on globally-recognised industry guidelines and principles (e.g. ICMA Social and
Green Bond Principles, Climate Bond Standards) and the EU Taxonomy.
As part of measures taken to ensure gender equality, the Bank strives to increase the share of women in senior
executive positions and ensure gender balance in recruitment and development processes. It also offers development
programmes dedicated to women, ensures a relevant female representation in succession planning and promotes
equal treatment and inclusion among employees. One of the key metrics in this regard is the female representation on
the Management Board (30% by 2025), on the Supervisory Board (between 40% and 60% by 2025) and in executive
positions (40% by 2025). In this regard, the Bank follows the GPW Corporate Governance Committee’s guidelines on
the application of Best Practice for GPW Listed Companies 2021. Rule 2.1 requires that the Bank implement a diversity
policy which incorporates the requirements set out in that rule, including the target minimum participation of the
minority group of at least 30%. However, it is not necessary – the Bank’s bodies have already met the diversity
requirement set out in the Best Practice for GPW Listed Companies 2021), as well as the EPG – Equal Pay Gap indicator.
The Bank also undertakes initiatives to support diversity and inclusion: there are Diversity Ambassadors (a role
performed by senior executives), employee networks (bottom-
up initiatives focused on the promotion of diversity),
educational campaigns, training, webinars (e.g. as part of the Diversity Month). The activities in this area are supported
by strategic partnerships with expert organisations: Share the Care, UN Global Compact Network Poland, Vital Voices,
Responsible Business Forum.
Employee focus is one of the Bank’s strategic directions for 2021-2023 and it is also a component of the new strategy
set for 2024-2026. Its delivery is monitored on an ongoing basis, also as part of quarterly eNPS surveys. Another
measure is the title of
the employer of choice in the banking sector (2023 Top Employer Poland certificate, Great Place
to Work! certificate, Ethical Company title). The Bank implemented a hybrid work model, promotes diversity, equal
treatment and inclusion, supports talent development, and promotes a healthy and eco-friendly lifestyle as part of
wellbeing programmes for employees.
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Chapter Important aspects of application of Best Practice for GPW Listed Companies 2021
Disclosure
policy, investor
communications
(Chapter 1)
Customer obsession is also one of the pillars of the Bank’s strategy. The Bank takes constant efforts to improve
customer satisfaction and all products and services are designed and implemented with a customer focus. These
aspects are measured using NPS (Net Promoter Score) – a customer loyalty metric. As part of the customer-centric
strategy, the Bank accelerated digitalisation and optimisation of processes, simplifies language in communication
with customers and ensures that products and distribution channels are tailored to the needs of specific customer
groups (including support for refugees from Ukraine – products and services for retail and business customers).
Since 2014, the Bank has been organising dialogue sessions with representatives of social and business partners in
accordance with the AA1000SES standard. Their purpose is to gather feedback and expectations regarding the Bank’s
activities in the area of responsible banking. Suggestions made by stakeholders are analysed and taken into account
in delivery of the strategy, in planning processes and in non-financial reporting. The last dialogue sessions were held
in 2023 as part of the update of the ESG releva
nce matrix. The key external stakeholders of the Bank (suppliers,
customers, business partners, sectoral organisations, NGOs, financial organisations, regulatory institutions, ESG
experts in the banking industry) were invited to take part in the studies of the ESG impact on the Bank and the impact
of the Bank in this respect on the environment.
The Bank’s equal pay index is published on the site dedicated to the Best Practice: https://www.santander.pl/relacje-
inwestorskie/dobre-praktyki. In 2023, the index was at 97.05%.
Each year, the Bank publishes a list of expenses incurred by the Group to support culture, sports, charity organisations,
media and civil society organisations (the list for 2023 is presented in Chapter VIII, Part 3 “Communication with
stakeholders”.)
The Bank’s disclosure policy concerning investor relations is described in more detail in Chapter VII “Investor relations”.
For more information about the arrangements facilitating communication with shareholders, see “General Meeting”
below (Part 4 “Governing bodies”).
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Chapter Important aspects of application of Best Practice for GPW Listed Companies 2021
Management
Board,
Supervisory
Board
(Chapter 2)
All members of the Bank’s Management Board and the Supervisory Board have appropriate knowledge, experience and
skills to duly perform their duties. Detailed information about their qualifications is presented in the later part of this
statement (Part 4 “Governing bodies”, Sections: “Management Board” and “Supervisory Board”).
The Bank has a diversity policy in place which promotes diversity among members of the Management Board and the
Supervisory Board in terms of their qualities and skills, gender, educational background, expertise, age, professional
experience and geographical provenance. It also requires the Supervisory Board to ensure at least 30% representation
of women in the Management Board by 2025. As regards the Supervisory Board, the Bank is to ensure 40%–60%
representation of women by 2025 (women already account for 40% of the Supervisory Board membership) – more
details are presented in Part 4 “Governing Bodies” and Part 8 “Diversity Policy”).
The independence criteria (specified in the Act on statutory auditors, audit firms and public oversight, Commission
Recommendation 2005/162/EC of 15 February 2005, and additional criteria stipulated in the Bank’s Statutes as agreed
with the KNF) are met by five of ten members of the Supervisory Board, who do not have actual and material connections
with a shareholder holding at least 5% of total voting power at the Bank’s General Meeting. These criteria are met by
the Chairman and all members of the Audit and Compliance Committee.
Members of the Management Board and the Supervisory Board commit sufficient time to perform their duties. The
functions performed on the Bank’s Management Board are the main area of the professional activity of its members,
some of whom also sit on the sup
ervisory boards of the Bank’s subsidiaries, which facilitates oversight and operation
of the Group as a whole. Management Board members may perform roles on the boards of entities outside Santander
Bank Polska Group exclusively with the consent of the Supervisory Board.
The Supervisory Board exercises an effective oversight of the Bank’s operations, verifies the activities of the
Management Board in terms of delivery of the strategic objectives and monitors the Bank’s performance. The
Management Board provides the Supervisory Board with access to information about matters related to the Bank as
well as relevant resources and opportunity to use independent, professional advisory services if need be. The
Supervisory Board provides the General Meeting with the Report on the Supervisory Board’s activity, which includes
detailed information about supervisory activities as well as the assessment of the Bank’s position, internal control
system, assessment of the remuneration policy, assessment of the Bank’s performance of its information obligations
and the sponsorship and corporate giving policy.
Systems
and internal
functions
(Chapter 3)
The Bank has an effective internal control, risk management and compliance system in place, as well as an effective
internal audit function adequate to the size of the Bank and the type and scale of its operations. Their effectiveness is
monitored and assessed by the Supervisory Board in coordination with the Audit and Compliance Committee.
The Bank’s organisational structure includes units responsible for the tasks of individual systems and functions.
The Head of the Internal Audit Area adheres to international standards for the professional practice of internal auditing
and reports directly to the President of the Management Board, with a dotted reporting line to the Chairman of the Audit
and Compliance Committee.
Remuneration payable to persons responsible for risk management and compliance and the Head of the Internal Audit
Area depends on the delivery of the tasks set rather than short-term results of the Bank.
The head of the compliance function reports directly to the Member of the Management Board in charge of the
Compliance and FCC Division. The Risk Management Division is headed by the Vice President of the Management Board.
The internal audit function meets the international standards for the professional practice of internal auditing, which is
verified as part of independent third-party assessment at least once every five years. The last assessment was carried
out in June 2019 by the Institute of Internal Auditors.
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Chapter Important aspects of application of Best Practice for GPW Listed Companies 2021
General Meeting,
shareholder relations
(Chapter 4)
Annual General Meetings are convened as soon as possible after the publication of an annual report at the date set in
keeping with the
applicable legislation. In 2023, the Annual General Meeting was held on 19 April, eight weeks after
the release of the annual report for 2022.
When selecting the venue for the General Meeting, the Bank enables the participation of the largest-possible number
of shareholders (the General Meetings of the Bank are held in Warsaw).
Since 2011, the Bank’s shareholders can participate in the General Meetings by means of electronic communication
channels (e-
meetings) and exercise their rights from anywhere in the world. General Meetings are broadcast live on
the Bank’s website. The representatives of media can participate in General Meetings.
To help shareholders make informed voting decisions, on the date of the notice of the General Meeting the Bank
publishes justifications of all resolutions (except for points of order and where justification follows from the materials
submitted to the General Meeting) together with their drafts on a dedicated website (www.santander.pl/wza). The
materials to be considered by the General Meeting are presented in a manner convenient to the shareholders.
In the case of resolutions requested by a shareholder to be included on the agenda, justifications are published
immediately after receiving the shareholder's request (in the case of requests made in the course of the General
Meeting, the justification is
presented to shareholders prior to adopting a resolution). Additionally, members of the
Bank’s governing bodies provide verbal information prior to the vote on the matter if it is required so to consider the
matter properly. The Bank takes efforts to ensure that draft resolutions are submitted no later than three days before
the General Meeting.
The General Meeting should be attended by members of the Management Board and the Supervisory Board who will
be able to give substantive answers to questions asked during the meeting.
Answers to shareholders’ questions are provided in line with the applicable legislation within the set time limits.
The Bank strives to distribute profit to the shareholders in accordance with the dividend policy and the KNF
recommendations. Under Resolution no. 6 of 19 April 2023, the Annual General Meeting allocated to the Dividend
Reserve nearly PLN 2.4bn from the ne
t profit earned by the Bank in the accounting year from 1 January 2022 to 31
December 2022. On 23 October 2023, in response to its request, the Bank received the KNF consent for dividend
payment (interim dividend). Consequently, on 16 November 2023 the Bank’s Management Board advised that it
decided to pay out an interim dividend for the accounting year of 2023 and to allocate PLN 2,375,901,550.50 for that
purpose. The dividend payment was made on 29 December 2023.
Conflict of interest,
related party
transactions
(Chapter 5)
The Bank and its subsidiaries have transparent procedures in place for managing conflicts of interest. They are
described in the General Code of Conduct and the Conflict of Interest Prevention Policy as well as policies applicable in
individual companies. They specify the criteria and circumstances in which a potential conflict of interest may arise and
procedures to be followed in such cases. They also define ways to prevent, identify and resolve conflicts of interest.
Members of the Management Board and the Supervisory Board refrain from professional activities which might cause
a conflict of interest. They must not participate in decision-making if there is an actual or potential conflict of interest.
They must also inform the Bank about such situations. Potential conflicts of interest involving members of the
Management Board and the Supervisory Board are also considered when assessing the suitability of candidates for
these bodies and as part of ongoing suitability assessments.
The Bank ensures equal treatment of customers and suppliers. No shareholder has preference over other shareholders
in related party transactions.
Transactions with related parties are made in accordance with the Bank’s internal regulations and market standards.
Approval from the Supervisory Board is required if: transactions with related parties exceed 5% of the Bank’s total
assets, transactions wit
h a single entity during the accounting year exceed PLN 50,000,000 or if transactions exceed
the PLN equivalent of EUR 4,000,000 (if applicable under specific internal provisions).
The Supervisory Board may seek external expert advice when making a valuation and analysing economic effects of
related party transactions. If the transaction requires the approval of the General Meeting, the Supervisory Board
assesses the need for seeking such advice.
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Corporate Governance Rules for Supervised Institutions
Santander Bank Polska S.A. is required to apply the Principles of Corporate Governance for Supervised Institutions issued by the KNF on 22 July 2014.
The document describes internal and external relations of supervised institutions, including relations with shareholders and customers, their
organisation, internal oversight framework and key internal systems and functions, as well as statutory bodies and the rules of their cooperation.
The document is available on the KNF website at
https://www.knf.gov.pl/knf/pl/komponenty/img/knf_140904_Zasady_ladu_korporacyjnego_22072014_38575.pdf
and on the Bank’s website at:
https://static3.santander.pl/asset/z/a/l/zal.-do-uchwaly-objetej-pkt-13-porzadku-obrad_pl_55449.pdf .
The Principles of Corporate Governance for Supervised Institutions were approved for full application in Santander Bank Polska S.A. starting from 1
January 2015 by force of Management Board resolution no. 116/2014 of 9 October 2014 and Supervisory Board Resolution no. 58/2014 of 17 December
2014. Then, the Principles were approved by the General Meeting of Shareholders of Santander Bank Polska S.A. on 23 April 2015.
The table below describes the delivery of initiatives which are of the key importance to the Bank’s shareholders.
Chapter Important aspects of application of Best Practice for GPW Listed Companies 2021
Remuneration
(Chapter 6)
The Bank’s Remuneration Policy meets all the requirements prescribed by law and supports the Group’s growth and
security. It complies with the principles of sound and effective risk management, prudent capital management, and it
is consistent with the Bank’s business strategy, objectives, values and long-term interests.
The Bank ensures the stability of its management team through such measures as transparent, fair, consistent and
non-discriminatory terms of remuneration.
The remuneration of members of the Management Board and the Supervisory Board and key managers is sufficient to
attract, retain and motivate persons with skills necessary for proper management and supervision of the Bank. The
remuneration structure fully r
eflects market practices while the remuneration levels match the ones offered in the
banking sector, taking into account the size of business. Remuneration is adequate to the scope of tasks performed.
In the case of the incentive plan established under the resolution of the Annual General Meeting of 27 April 2022, the
level of remuneration depends on financial and non-financial performance in the long term (PAT, ROTE, NPS), including
sustainability factors (delivery of ESG objectives).
The remuneration of Supervisory Board members does not depend on the Bank’s results. The Supervisory Board
members receive fixed monthly remuneration irrespective of the number of Supervisory Board meetings held.
Supervisory Board members receive additional remuneration for work on the Supervisory Board committees.
Chapter
Important aspects of application of the Principles of Corporate Governance for Supervised Institutions by Santander Bank
Polska S.A.
Organisation and
organisational
structure
(Chapter 1)
The organisation of the Bank facilitates the delivery of long-term objectives, among other things by combining strategic
planning with analysis of the required resources. The Bank sets its strategic objectives taking into account the character
and scale of business activity in its strategy approved by the Management Board and the Supervisory Board.
The Bank has a transparent and appropriate organisational structure with functions assigned to organisational and
tasks clearly allocated to Management Board members, head office units, branches and specific groups of positions.
The effectiveness of the Bank’s structure is analysed on an ongoing basis, taking into account market trends and
benchmark data. The Bank’s structure is available at: https://www.santander.pl/relacje-inwestorskie/informacje-o-
spolce/wladze-banku.
The organisation of the Bank makes it possible to change priorities as part of quarterly planning and business review,
taking into account the analysis of business risks it is exposed to. Furthermore, the Bank has clear procedures to be
followed in a speci
al situation, i.e. in case of significant deterioration of its financial position or occurrence of
operational events that disrupt or prevent the Bank from conducting its business activity. The Bank also has business
continuity plans to minimise losses and ensure continuity of operations if special situations materialise.
The Bank complies with law and supervisory and regulatory recommendations and has specialised units (Legal Area,
Compliance Area) which support the Bank in adhering to regulations and monitor the performance of the Bank’s
obligations in this respect. The Bank’s internal control system is effective and efficient. Its objective is to ensure the
Bank’s compliance with law and risk management rules, reliability of financial reporting and effectiveness of the Bank’s
operations. The Bank’s employees may anonymously report breaches using the whistleblowing channels available at
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the Bank without fear of retaliation from managers or colleagues. The effectiveness of the procedure for anonymous
reporting of breaches is assessed at least once a year by the Supervisory Board.
Relations with
supervised
institution's
shareholders
(Chapter 2)
The Bank conducts its activity taking into account the interests of all stakeholders as long as they are not contrary to
the interests of the Bank. To that end, the Bank has adopted detailed guidelines setting out rules of conduct and
principles for preventing conflicts of interest.
The Bank provides its shareholders with appropriate access to information and facilitates their participation in General
Meetings, as described in detail in the section that discusses the material aspects of application of the Best Practice for
GPW Listed Companies 2021 set out in Chapter 4 “ General Meeting, shareholder relations”
By exercising oversight, the shareholders contribute to effective and proper functioning of the Management Board and
Supervisory Board. Members of the Management Board do not exercise their voting rights attached to the shares they
hold. 50% of the Supervi
sory Board members meet the independence criterion, which prevents worsening of the
effectiveness of the shareholder oversight.
The Bank’s shareholders do not hold any individual or other specific rights. Each share of the Bank gives one vote at the
General Meeting.
Transactions with related parties are made in line with legal and tax requirements. The Bank has relevant internal
policies in place, ensuring that such transactions are made in the interest of the Bank, are transparent and comply with
market standards.
The purpose of the Bank’s dividend policy is to ensure stable profit distribution in the long term and optimal capital
structure of the Bank and Santander Bank Polska Group. The Bank’s Management Board recommends payment of
dividend by way of a resolution, taking into account prudent management and capital surplus over the acceptable
capital ratios, as well as laws and recommendations and individual guidance issued by the supervisory authority (KNF).
Management
body
(Chapter 3)
The Bank is managed by the Management Board which is a collective body. All members of the Management Board
meet the criteria arising from law, best practice, regulatory recommendations and principles of corporate governance
for supervised institutions, gi
ving assurance of proper performance of their duties. It is verified by the Nominations
Committee and the Supervisory Board as part of suitability assessment conducted before the appointment of the
Management Board members and periodically (at least annually).
The Management Board is the only body with the authorisation and duty to manage the Bank’s operations. While
pursuing the adopted strategy, the Management Board is guided by safety of the Bank, applicable law,
recommendations of supervisors and internal regulations of the Bank.
Members of the Management Board are collectively responsible for decisions which are within its remit, irrespective
of the internal of responsibility for particular areas. The internal division of powers among Management Board
members is transparent and covers all operational areas of the Bank. It is based on the organisational structure and
adopted in the form of the Management Board resolution approved by the Supervisory Board.
None of the Management Board members conducts an activity which could lead to a conflict of interest or adversely
affect his or her reputation as a member of the Management Board. Functions performed on the Management Board
are their main area of professio
nal activity, which ensures that they commit relevant time and effort to their
responsibilities.
There is a succession plan for Management Board members, approved by the Supervisory Board, which enables their
immediate replacement (if need be).
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Chapter
Important aspects of application of the Principles of Corporate Governance for Supervised Institutions by
Santander Bank Polska S.A.
Supervisory body
(Chapter 4)
The Bank is supervised by the Supervisory Board. All members of the Supervisory Board meet the criteria arising from
law, best practice, regulatory recommendations and principles of corporate governance for supervised institutions,
giving assurance of prop
er performance of their duties. It is verified by the Nominations Committee as part of
suitability assessment conducted before appointment of the Supervisory Board members and periodically (at least
annually). The suitability assessment is submitted to the General Meeting for approval.
The composition of the Supervisory Board ensures an appropriate number of persons who speak Polish (five out of ten
members) and have appropriate experience and knowledge of the Polish financial market (six out of ten members).
The Supervisory Board members who do not speak Polish take advantage of the assistance of interpreters and
documentation translated into English. Half of the members of the Supervisory Board (including all members of the
Audit and Compliance Committee and its Chairman) have independ
ent status (the independence criteria arise from
the Act on statutory auditors, audit firms and public oversight, and they include in particular no direct or indirect
connections with the Bank, members of the governing bodies, major shareholders and their connected entities).
As part of its tasks described in its Terms of Reference, the Audit and Compliance Committee monitors the
performance of financial audit activities and agrees the rules of conducting these activities, including their proposed
plan. The co-operation of the
Audit and Compliance Committee and of the Supervisory Board with the external auditor
is documented in the reports and letters addressed to these bodies and in the minutes of their meetings.
Members of the Supervisory Board actively perform their functions and are sufficiently engaged in the work of the
Supervisory Board, as demonstrated e.g. by high attendance at the meetings in 2023. All members of the Supervisory
Board give assurance of proper performance of their duties. Specifically, all members of the Supervisory Board meet
the criteria set out in Article 22aa of the Banking Law Act related to the maximum number of functions performed.
The Supervisory Board exercises ongoing oversight of the Bank’s operations and takes preventive and remedial
measures. The Supervisory Board receives reports on all areas of the Bank’s operations, including reports on the
delivery of strategic objectives,
significant changes in the level of risk or materialisation of significant risks as well as
on financial reporting and the accounting policy.
There is a succession plan for Supervisory Board members which enables their immediate replacement (if need be).
Each year, the Supervisory Board assesses compliance with the Principles of Corporate Governance for Supervised
Institutions. A relevant statement in this respect is an element of the report on the Supervisory Board’s activities and
is available on the website at: https://www.santander.pl/relacje-inwestorskie/dobre-praktyki.
Remuneration
policy
(Chapter 5)
The rules regarding remuneration for members of the Management Board and the Supervisory Board are set out in
the Remuneration Policy for Members of the Management Board of Santander Bank Polska S.A. and in the
Remuneration Policy for Members of the Supervisory Board of Santander Bank Polska Group approved by the General
Meeting.
The remuneration policy takes into account the Bank’s financial position and payment of variable remuneration
depends on the achievement of specific financial and non-financial objectives by the Bank.
The Supervisory Board oversees the remuneration policy, including verification of the criteria for payment of variable
components of remuneration. The Supervisory Board submits an annual report on the remuneration policy to the
General Meeting, indicating whether the policy supports the Bank’s growth and security.
The remuneration of the Management Board members is set by the Supervisory Board and the remuneration of the
Supervisory Board members is set by the General Meeting, considering the functions performed and the scale of the
Bank’s business. The Supervisory Board members who sit on committees are remunerated for additional tasks
performed.
Remuneration regulations for key function holders (other than Management Board members) are adopted and
supervised by the Management Board.
Variable remuneration is awarded to Management Board members based on the evaluation of their performance.
Variable remuneration for the Bank’s Management Board members and key managers depends on the assessment of
the company’s long-term financial position, long-
term growth in shareholder value, stability of the company’s
operations and risk appetite.
Members of the Bank’s Management Board do not receive remuneration for performing duties of supervisory board
members in the companies to which they have been designated by the Bank.
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Recommendation Z of the Polish Financial Supervision Authority (KNF) on corporate
governance in banks
Recommendation Z has been effective as of 1 January 2022. To ensure full compliance with the recommendation, the processes and corporate
governance rules were already reviewed and refined in 2021 both at the Bank and the Group level, including as part of the review or update of several
dozen internal regulations.
Recommendation Z is a set of best practice on internal governance for banks. It supplements, refines and develops existing laws in this respect as well
as KNF documents, in particular the Principles of Corporate Governance for Supervised Institutions described above.
Pursuant to Recommendation Z, in February 2023 the Bank’s Management Board and Supervisory Board made a periodical assessment of internal
governance in the Bank and Santander Bank Polska Group based on the dedicated “Methodology for the assessment of internal governance in Santander
Chapter
Important aspects of application of the Principles of Corporate Governance for Supervised Institutions by
Santander Bank Polska S.A.
Disclosure policy
(Chapter 6)
The Bank has a disclosure policy in place, providing clear and reliable information to its shareholders, customers and
other stakeholders. The policy provides for active measures to be taken by the Bank to satisfy information
requirements of its stakeholde
rs. The Bank communicates with capital market participants in a way that is adjusted
to the needs of specific groups.
The Bank’s information policy is available on the Bank’s website at: https://www.santander.pl/relacje-
inwestorskie/dokumenty-korporacyjne#dokument=4. Detailed information about its assumptions is presented in the
Chapter 1 “Disclosure policy, investor communications” in the section on the application of Best Practice for GPW
Listed Companies 2021.
Promotional
activities and
client relations
(Chapter 7)
Customer focus and customer experience are among the Bank’s strategic priorities. The Bank’s Consumer Protection
Policy establishes the criteria for identification, organisation and protection of consumer rights in all activities of the
Bank, including as part of the use of customer-centric model of products and services, agreed rules for communication,
complaints handling and application of predefined control mechanisms.
When offering financial products and services, the Bank is focused on providing customers with accurate information
and meaningful explanations. Before entering into an agreement, customers receive necessary information about
products and services in due course. The Bank makes sure that documents provided to customers are made in plain
language and are easy to understand.
Customer complaints are handled by the Customer Care Office in accordance with clear and transparent rules. They
are also periodically analysed to identify causes and take remedial actions.
The Bank has formal rules in place with respect to marketing communication and advertising messages, ensuring that
they are accurate and not misleading and that they comply with applicable laws, principles of fair trade and good
conduct.
Key internal
systems and
functions
(Chapter 8)
The Bank has an effective and appropriate internal control system in place that covers all levels of the Bank’s
organisational structure and is annually assessed by the Audit and Compliance Committee and the Supervisory Board.
The Bank ensures independence of the internal audit function and the compliance function. The Head of the Internal
Audit Area adheres to international standards for the professional practice of internal auditing and reports directly to
the President of the
Management Board, with a dotted reporting line to the Chairman of the Audit and Compliance
Committee. The head of the compliance function reports directly to the Member of the Management Board in charge
of the Compliance and FCC Division. The Head of the Audit Area and the head of the compliance function take part in
all meetings of the Management Board, the Audit and Compliance Committee, the Risk Committee and the
Supervisory Board.
The Bank’s risk management system is organised according to the nature, scale and complexity of the business, taking
into account the strategic objectives, the risk management strategy and the risk appetite. It is assessed by the Risk
Committee and the Supervisory Board on an annual basis.
Execution of
rights resulting
from assets
acquired at
customer's risk
(Chapter 9)
When buying assets at the customer’s risk, the Bank (Santander Brokerage Poland) executes the customer’s orders in
line with the terms and conditions and the general terms of providing services which include the principle of best
execution (Best Execution Policy). The decision-making process is duly documented.
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Bank Polska S.A.” approved by the Supervisory Board. Findings from the assessment confirmed a very high level of internal governance both in the Bank
and in the Bank’s subsidiaries.
The section below presents the main aspects of application of Recommendation Z by the Bank. Recommendation Z is available on the KNF’s website at:
https://www.knf.gov.pl/knf/pl/komponenty/img/Rekomendacja_Z_70998.pdf.
Chapter of Recommendation
Z
Important aspects of application of Recommendation Z by Santander Bank Polska S.A.
A. General principles of
internal governance in the
Bank
The Bank has a transparent, effective and legally compliant internal governance framework, defined in
the Bank’s Statutes and the hierarchical system of internal regulations, i.e. internal governance rules,
operational models, policies, terms of reference, procedures, guidelines and other internal regulations.
The Bank also ensures appropriate internal governance across the Group and exercises effective
shareholder oversight of its subsidiaries.
The said internal governance assessment methodology supports the Management Board and the
Supervisory Board in making that assessment and verifying if internal governance is adjusted to the
changing situation in the Bank and its external environment. The Supervisory Board assesses the Bank’s
internal governance and its implementation at least once a year.
B. Rules of procedure,
powers, duties and
responsibilities of the
Supervisory Board members,
the Management Board
members and key function
holders in the Bank, their
mutual relations and
suitability
The Bank’s Management Board defines the purpose, long-term plans and strategic objectives of the Bank.
The Bank provides the Supervisory Board with access to information, resources and support necessary to
perform its tasks.
The Bank has regulations in place governing the appointment and removal of members of the
Management Board and the Supervisory Board. The composition of the governing bodies takes into
account the ownership structure, business profile and business plans of the Bank.
Members of the Supervisory Board and the Management Board and key function holders at the Bank
meet the suitability requirements, i.e. they have the knowledge, skills and experience required to perform
their functions and can commit sufficient time to the performance of their duties (they meet the minimum
time commitment). At least once a year, the Bank assessed the suitability of all the persons mentioned
above.
The Supervisory Board and the Management Board perform their tasks based on written terms of
reference. The General Meeting is informed about any amendments to the Terms of Reference of the
Supervisory Board. The appropriateness of internal regulations on the Supervisory Board and the
Management Board operations as well as effectiveness of these bodies are subject to regular assessment
(including with the participation of independent advisors – the report on independent assessment of the
Bank’s Supervisory Board by KPMG Advisory spółka z ograniczoną odpowiedzialnością sp.k. was
presented to the Extraordinary General Meeting on 12 January 2023 and it is available online
atsantander.pl/wza).
C. Rules of conduct and
conflicts of interest at the
Bank
The Bank adheres to ethical standards set out in the General Code of Conduct. The Code regulates basic
standards of behaviour and is an important element of the corporate culture. When making business
decisions, the Bank is guided not only by legal or regulatory requirements but also by ethical standards
adopted by the organisation. Those values are the foundation for building an effective internal
governance framework in the Bank (the General Code of Conduct is available on the Bank’s Internal
Relations site, “Corporate documents” tab:https://www.santander.pl/relacje-inwestorskie/dokumenty-
korporacyjne). At least one a year, the Management Board verifies and assesses the compliance with
ethical standards and informs the Supervisory Board about the results.
The Bank has effective and transparent rules for managing conflicts of interest. The internal regulations
in this respect cover in particular relations, agreements and transactions with connected entities and
between the Bank and:
the Bank’s customers;
the Bank’s shareholders;
members of the Supervisory Board and the Management Board;
the Bank’s employees;
material suppliers and business partners;
other connected parties than those listed above.
Prices of transactions made between the Bank and its connected entities must be made on an arm’s
length basis. Transactions are made upon the verification of conflicts of interest (even potential ones).
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Code of Banking Ethics
In addition to the foregoing corporate governance principles, Santander Bank Polska S.A. follows best sector practice established by the Polish Bank
Association (ZBP) in the Code of Banking Ethics adopted by the 25th General Meeting of ZBP dated 18 April 2013.
The Code of Banking Ethics is composed of two parts:
Code of Best Banking Practice – a set of rules to be followed by banks in their relations with customers, employees, business partners and competitors;
Bank Employee Code of Ethics – rules of conduct for bank employees.
The Code of Banking Ethics is available on the website of the KNF at: https://www.zbp.pl/dla-klientow/poradniki-i-rekomendacje.
Internal regulations
The general corporate governance principles are described in detail in the Bank’s internal regulations.
The Bank has the Group-Subsidiary Governance Model and Guidelines for Subsidiaries as well as Specific Corporate Frameworks in place. The above-
mentioned model sets out the basic rules to be followed by the Group in its relations with subsidiaries. It also includes guidelines on management and
supervisory bodies and corporate governance concerning key business, support and control functions.
Approval from the Supervisory Board is required if: transactions with related parties exceed 5% of the
Bank’s total assets, transactions with a single entity during the accounting year exceed PLN 50,000,000
or if transactions exceed the PLN equivalent of EUR 4,000,000 (if applicable under specific internal
provisions).
D. Outsourcing policy,
remuneration rules and
dividend policy of the Bank
The Bank has relevant internal regulations setting out the rules for outsourcing activities to third parties
and ensures strict supervision over the outsourced activities. Every six months, the Management Board
reports to the Supervisory Board on the assessment of contracts in terms of their correctness and
compliance with law as well as quality and timeliness of outsourced activities.
The remuneration rules in the Bank support in particular:
Appropriate and effective management of risk and avoidance of excessive risk-taking beyond the
maximum risk appetite approved by the Supervisory Board;
Implementation of the Bank management strategy and risk management strategy and prevention of
conflicts of interest.
The Bank’s dividend policy takes into account in particular the Bank’s current economic and financial
standing, macroeconomic environment, assumptions arising from internal regulations on the Bank
management strategy and risk management strategy, the KNF’s position on the dividend policy for
financial institutions, limitations arising from the Act on macroprudential supervision over the financial
system and crisis management in the financial system, and the assumed dividend payout ratio. The policy
is regularly updated as part of the review of the Bank’s internal regulations.
E. Risk management
The Bank has the risk management system developed and implemented by the Management Board and
covering the Bank’s organisational units. It is based on three independent and complementary levels
(lines of defence) and:
takes into account the significance of the Bank’s exposure to risk;
covers all significant risk types (including environmental, social and management risks), including
adequacy and effectiveness and interdependencies between particular risk types;
enables effective decision making with regard to the execution of the Bank’s management strategy.
The risk culture principles applicable at the Bank cover the entire organisation and are aimed to raise the
awareness of risk management obligations of all employees. The risk culture is promoted through
numerous training sessions and initiatives.
The Bank’s product approval policy ensures compliance with regulatory requirements and takes into
account valuation models and the impact on the risk profile, capital adequacy, profitability and availability
of resources. The risk management unit and the compliance unit are involved in approving new products.
F. Disclosures
The Bank has the
disclosure strategy, whose main purpose is to provide market participants with reliable
and exhaustive information about the Bank’s risk profile. The strategy sets out the scope, frequency, time
limits and forms of disclosure and rules for approval and verification of information subject to disclosure,
and assessment whether market participants are provided with a comprehensive picture of the risk
profile (the strategy is available on the Bank’s Investor Relations site, “Corporate documents” tab).
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The Internal Governance Rules of Santander Bank Polska S.A. define the key rules applied by the Bank with regard to the management system,
organisational structure, internal and external relations, including relations with shareholders and customers, internal supervision and key internal
systems and functions, as well as the rules of procedure, powers, obligations and responsibilities of members of the Supervisory Board and the
Management Board and key function holders and mutual relations between them. Furthermore, the Corporate Governance Rules of Santander Bank
Polska Group define the organisation and functioning of the Group entities as well as the rules for cooperation and intragroup reporting.
Irrespective of their role, all employees of the Bank and the Group must follow ethical principles and rules of conduct established in the General Code of
Conduct. It is a set of key principles and values reflecting the corporate culture of Santander Group, whose aim is to build trust and lasting loyalty of
employees, customers, shareholders and communities. These rules are strictly connected with the Bank’s business strategy and purpose, which is to help
customers and employees prosper in a Simple, Personal and Fair way.
The Bank’s corporate behaviour model is based on the following five behaviours: Think customer, Embrace change, Act now, Move Together and Speak
up They emphasise that people, teams and customers are the top priority for the Bank. They are also used as performance review criteria.
The formal framework of the Bank’s corporate culture also includes the Responsible Banking and Sustainability Policy, which defines the organisation’s
approach to sustainable development in terms of responsible banking as well as the Bank’s voluntary ethical, social and environmental commitments.
For details, please see Chapter XIV “Statement on non-financial information for 2023”.
2. Issuer’s securities
Structure of share capital
The table below presents the entities with significant holdings of Santander Bank Polska S.A. shares as at 31 December 2023 and 31 December 2022.
Shareholders with a stake of 5% and higher
Number of shares and voting rights % in the share capitaland total votes at GM
31.12.2023 31.12.2022 31.12.2023 31.12.2022
Banco Santander S.A. 68,880,774 68,880,774 67.41% 67.41%
Nationale-Nederlanden OFE 1) 5,123,581 5,123,581 5.01% 5.01%
Other shareholders 28,184,959 28,184,959 27.58% 27.58%
Total 102,189,314 102,189,314 100.00% 100.00%
2) Nationale-Nederlanden Otwarty Fundusz Emerytalny (OFE) is managed by Nationale-Nederlanden Powszechne Towarzystwo Emerytalne (PTE) S.A.
As at 31 December 2023, Banco Santander S.A. held a controlling stake of 67.41% in the registered capital of Santander Bank Polska S.A. and in the total
number of votes at the Bank’s General Meeting. The remaining shares were held by the minority shareholders, of which, according to the information
held by the Bank’s Management Board, only Nationale-Nederlanden Otwarty Fundusz Emerytalny (OFE) exceeded the 5% threshold in terms of share
capital and voting power.
According to the information held by the Management Board, the ownership structure as regards shareholders with a minimum 5% stake in terms of the
voting power did not change in the period from the end of the financial year of 2023 until the date the Annual Report of Santander Bank Polska Group for
2023 was authorised for issue.
Rights and restrictions attached to the issuer’s securities
The shares of Santander Bank Polska S.A. are ordinary bearer shares. Each share carries one vote at the General Meeting. The nominal value is PLN 10
per share. All shares are fully paid.
The Bank did not issue any series of shares that would give their holders any special control rights towards the issuer or would limit their voting power
or other rights. Neither are there any restrictions on the transfer of title to the issuer’s shares.
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Planned share buyback in relation to Incentive Plan VII
The Bank’s Annual General Meeting of 27 April 2022 established Incentive Plan VII and determined its terms and conditions. For the purpose of the Plan,
between 2023 and 2033 the Bank will buy back up to 2,331,000 shares in accordance with the revised remuneration strategy for key employees of the
Bank for 2022–2026, which introduced variable remuneration based on the Bank’s shares. In the case of participants of Incentive Plan VII who are material
risk takers within the meaning of Article 9ca(1a) of the Banking Law Act, the form of variable remuneration has been changed from phantom stock to the
Bank’s actual shares.
On 12 January 2023, the Extraordinary General Meeting authorised Management Board members to acquire own shares to perform the Bank’s
obligations under Incentive Plan VII. In 2023, the Bank bought back the total of 165,406 of its own shares (with nominal value of PLN 1,654,060) at PLN
48,884,192.40, which represent 0.162% of the Bank’s share capital and carry 0.162% votes. Instructions were made to transfer the 165,406 shares to
the participants of Incentive Plan VII. Having settled all these instructions, the Bank does not hold any of its own shares.
Pursuant to the Resolution no. 29 of the Bank’s Annual General Meeting of 19 April 2023 (and amended Resolution no. 3 of the Bank’s Extraordinary
Meeting of 11 January 2024), the Bank is going to buy back up to 271,000 own shares in 2024 as part of Incentive Plan VII.
3. Amendment of the Statutes of Santander Bank Polska S.A.
Any amendments to the Statutes of Santander Bank Polska S.A. may be made by way of a resolution of the General Meeting and must be entered into
the register of entrepreneurs of the National Court Register in order to be valid. In accordance with the Banking Law Act, such amendments also require
consent from the Polish Financial Supervision Authority (KNF). Key changes introduced in 2023:
1) item 3 added to §13 of the Statutes in order to make that document compliant with the requirements arising from Articles 77 and 78 of the
Regulation (EU) No. 575/2013 of the European Parliament and of the Council dated 26 June 2013 on prudential requirements for credit
institutions and investment firms and amending Regulation (EU) No. 648/2012;
2) §30(2) of the Statutes amended to make the Statutes consistent with Article 388 § 3 of the Commercial Companies Code dated 15 September
2000. This change allows the Bank’s Supervisory Board to take the measures provided by the Commercial Companies Code with respect to
passing resolutions.
Provisions of the Statutes before and after the change:
Paragraph Wording before the change Wording after the change
§ 13(3) none
3. The purchase or redemption of the Company's own shares requires
the consent of the Polish Financial Supervision Authority (KNF).
§ 30(2)
2. If necessary, a resolution of the Supervisory Board can
be taken by circulation. Resolutions passed by
circulation are circulated to all Supervisory Board
members and become valid when signed by at least half
of the Supervisory Board members, including the
Chairperson.
2. If there is a need, resolution of the Supervisory Board can be taken in
writing or by using direct communication over distance. Resolutions
adopted in writing become valid when all Supervisory Board members
have been informed about the contents of the draft resolution and
when at least half of them took part in adopting the resolution.
The above-mentioned amendments to the Statutes were adopted under Resolution no. 28 of the Annual General Meeting of Shareholders of 19 May
2023 re changes to the Bank’s Statutes. They were registered by the registry court and came into force on 15 May 2023.
On 11 January 2024, the Extraordinary General Meeting passed Resolution no. 4 on changes to the Bank’s Statutes in order to provide a more detailed
catalogue of actions listed in Article 69 (2)(2) and (5) of the Act of 29 July 2005 on Trading in Financial Instruments (Journal of Laws of 2022 no. 1500 as
amended) that the Bank performs pursuant to Article 70(2) of this Act.
Provisions of the Statutes before and after the change:
Paragraph
Version applicable now Version proposed
§7(2)(7a)(b): b) client trading in non-publicly traded securities;
b) execution of orders to buy or sell financial
instruments on behalf of the party placing the order;
§7(2)(7a)(c):
c) proprietary trading in the securities issued by the State Treasury
and the National Bank of Poland and in non-
publicly traded
instruments: securities, participations in undertakings for collective
c) buying or selling financial instruments on one’s own
account;
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investments other than securities, money market instruments,
derivatives, including options, forwards, swaps and contracts for
difference;
The above-mentioned changes to the Bank’s Statutes were registered by the registry court and came into force on 25 January 2024.
The Bank received a consent from the KNF to amend the Statutes as above.
4. Governing bodies
General Meeting
Organisation and powers of the General Meeting
The Bank’s General Meeting is held as provided for in the Commercial Companies Code of 15 September 2000, the Bank’s Statutes and
the Terms of Reference of the General Meeting. The Statutes as well as the Terms of Reference of the General Meeting are available on
the Bank’s website:
https://www.santander.pl/relacje-inwestorskie/dokumenty-korporacyjne#dokument=6
The Annual General Meeting is held once a year by 30 June. The Extraordinary General Meeting is convened when it is required to take a decision on a
specific matter or when such a meeting is requested by eligible parties.
The General Meeting agrees on the issues within its remit, as defined by the above-mentioned laws and internal regulations. The Annual General Meeting:
reviews and approves the Management Board’s report on the Bank’s performance and the financial statements for the previous financial year;
adopts a resolution on profit distribution or loss coverage;
gives discharge to the members of the company’s governing bodies;
reviews and approves the financial statements of the Group within the meaning of the accounting regulations;
reviews other reports (e.g. report on the activities of the Supervisory Board).
The Annual General Meeting or the Extraordinary General Meeting may:
adopt a resolution to amend the Bank’s Statutes;
appoint members of the Supervisory Board;
remove members of the Management Board;
adopt a resolution to increase share capital;
decide on a merger with another company;
adopt a resolution on remuneration policies for members of the Management Board and the Supervisory Board, set the remuneration for
members of the Supervisory Board.
Since 2011, the Bank’s shareholders may participate in the General Meeting using electronic communication channels (without the physical presence of
themselves or their proxies). This enables two-way real-time communication and makes it possible for shareholders to exercise their voting rights. The
Bank’s approach, applied and improved for years, proved particularly effective during the Covid-19 pandemic, when the physical participation in the
General Meeting was significantly impeded.
Voting (including via electronic communication channels) takes place using an electronic voting system which returns the number of votes ensuring that
they correspond to the number of shares held, and in the case of a secret ballot – allows shareholders to remain anonymous. Shareholders may vote in
person or by proxy.
The General Meeting is broadcast live online to all interested parties and a recording is available on the Bank’s website dedicated to the General Meeting
for later review. The information about the planned broadcast is published at least seven days before the date of the General Meeting.
Draft resolutions, rationale, and other submissions to the General Meeting (assessments, reports and opinions of the Bank’s Supervisory Board) are
published on the Bank’s website early enough for the General Meeting participants to read them.
The representatives of the press, radio and TV may also attend the General Meeting.
General Meetings held in 2023
On 19 April 2023, the Annual General Meeting of Santander Bank Polska S.A. was held. It approved the 2022 reports submitted by the
Management Board and the Supervisory Board, and the Supervisory Board’s assessments of the required areas. It also considered the
Management Board's proposal regarding the distribution of the profit for 2022 and the having the profit from the sale of AVIVA shares set
aside as the dividend reserve, approved the collective suitability assessment of the Supervisory Board and the individual suitability assessment of the
Supervisory Board members, granted discharge to the members of the Management Board and the Supervisory Board, reviewed the report on the
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remuneration of Management Board and Supervisory Board members for 2022, created a capital reserve to be earmarked for the purchase of own shares
under Incentive Plan VII and authorised the Management Board to purchase the Bank’s own shares under the Plan in 2024. Moreover, the Bank informed
the General Meeting about the KNF’s guidance on assessing the adequacy of internal regulations and effectiveness of the Supervisory Board’s operations
(a relevant current report was distributed to the General Meeting and published online at santander.pl/wza).
In 2023, two Extraordinary General Meetings were held.
– on 12 January 2023, the Annual General Meeting: i) passed the resolution on the authorisation of the Management Board members to acquire (buy
back) own shares as part of Incentive Plan VII in 2023 and establishment of a capital reserve for that purpose; and ii) assessed the effectiveness of the
Supervisory Board operations based on an independent report made by a third party (KPMG Advisory spółka z ograniczoną odpowiedzialnością sp.k.)
– on 20 July 2023, the Extraordinary General Meeting was convened in connection with changes in the composition of the Supervisory Board (John Power
stepped down). Following a suitability assessment, the Extraordinary General Meeting appointed Adam Celiński as the new member of the Supervisory
Board to replace John Power. The Extraordinary General Meeting also changed the monthly remuneration of Supervisory Board members because it had
not been updated since June 2020 and, as such, it was no longer competitive compared to that offered by other banks.
On 13 December 2023, the Extraordinary General Meeting was called for 11 January 2024. During the meeting, the Resolution no. 29 of the General
Meeting dated 19 April 2023 was amended by setting the maximum price per share for the Bank’s shares to be bought back as part of Incentive Plan VII,
such change resulting from a considerable growth of the market price since 19 April 2023. Secondly, a resolution to amend the Bank’s Statutes was
passed (for more details, see Section 3 “Amendment of the Statutes of Santander Bank Polska S.A.”).
Shareholders' rights
The rights of shareholders of Santander Bank Polska S.A. are set out in the Terms of Reference of the Bank’s General Meeting in line
with the Commercial Companies Code.
The fundamental right of shareholders is to attend the General Meeting and vote (personally or through proxies).
Pursuant to the Terms of Reference of the General Meeting, shareholders or their proxies may participate in the General Meeting via electronic
communication channels (i.e. they may vote, make an objection, communicate with the meeting room, ask questions, etc.). Each share carries one vote
at the General Meeting.
Shareholders have certain rights with respect to the General Meeting, as specified in the Commercial Companies Code. In particular, they may:
object to adopting a resolution;
appeal against resolutions adopted by the General Meeting to the court (action for revocation or cancellation of a
resolution);
request voting by secret ballot;
submit draft resolutions and propose amendments and supplements to draft resolutions concerning the business of the
General Meeting by the end of discussion of a particular agenda item;
ask questions and request information from the Management Board regarding issues on the General Meeting agenda,
as provided for by the Commercial Companies Code;
apply for the role of the Chairman of the General Meeting or propose a candidate for that role;
challenge decisions made by the Chairman of the General Meeting;
give a brief presentation and a short response to questions concerning individual items of the agenda.
Shareholders may also:
request that a list of shareholders be emailed to them free-of-charge to the indicated address, inspect the list of
shareholders available in the Bank’s Management Board office and request a copy of the list at their own expense;
demand copies of requests included in the General Meeting agenda one week before the General Meeting;
have access to the General Meeting minutes and request copies of resolutions confirmed by the Bank’s Management
Board as true copies.
The Management Board members, acting within their powers and in accordance with the act on trading in financial instruments, have an obligation to
respond to shareholders’ questions which are relevant to the business of the General Meeting (for important reasons only – the response must be given
in writing within two weeks of the request). The Management Board refuses to provide the requested information if it might:
be prejudicial to the company or its subsidiaries or affiliates due to disclosure of technical, trade or organisational secret;
cause a member of the Management Board to face criminal, civil or administrative liability.
Shareholders may request the Bank to provide information concerning the Bank outside of the General Meeting. In such a case, the Management Board
may provide the requested information in writing, unless it might be prejudicial to the Bank, its subsidiary or affiliate, in particular due to disclosure of
the company’s technical, trade or organisational secret.
If the Bank provides information outside of the General Meeting, it publishes a current report with answers to the questions asked.
Management Board Report on Santander Bank Polska Group Performance in 2023
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Supervisory Board
Rules of procedure of the Supervisory Board
The Supervisory Board of Santander Bank Polska S.A. operates under the Banking Law Act of 29 August 1997, the Commercial Companies Code of 15
September 2000, the Bank’s Statutes and the Terms of Reference of the Supervisory Board, available on the Bank’s website.
Composition, rules for appointment and removal of Supervisory Board members
The Supervisory Board consists of at least five members appointed for a joint three-year term of office. Terms of office are set in full
financial years. The Supervisory Board members, including the Chairman of the Supervisory Board, are appointed and removed by the
General Meeting. The Management Board informs the KNF about the composition of the Supervisory Board. The term of office of the
Supervisory Board member expires no later than on the date of the General Meeting held to approve the financial statements for the last full financial
year in which the member served on the Supervisory Board. It also expires as a result of the member’s death, resignation or removal. The term of office
of the Supervisory Board member who was appointed before the end of the term of the Supervisory Board expires at the same time as those of the
remaining members.
Pursuant to the Bank’s Statutes, at least half of the Supervisory Board members should be of independent status.
Powers of the Supervisory Board
The Supervisory Board exercises ongoing oversight of the Bank’s operations. Apart from the rights and obligations provided for by the law
and the Statutes, the Supervisory Board also has the following powers:
to assess the financial statements in terms of their consistency with the books of account, documents and factual circumstances;
to approve the Bank’s annual and long-term development and financial plans, strategy and rules of prudential and stable management
established by the Management Board;
to approve the Management Board’s proposals as regards setting up and winding up the Bank’s units abroad;
to give consent to equity investments to be made by the Bank if:
the value of such investment exceeds the PLN equivalent of EUR 4,000,000;
the value of such investment exceeds EUR 400,000 and, concurrently, as a result of such investment, the Bank’s share in
another entity will be equal to, exceed or will be reduced below 20% of the votes at the General Meeting;
with the exception of underwriting agreements, the total exposure of the Bank under such agreements does not exceed one tenth of the total
own funds of the Bank;
to give consent to buy, sell or encumber non-current assets (as defined in the Accounting Act), in particular real property, if the value of a non-
current asset exceeds the PLN equivalent of EUR 4,000,000, except for foreclosure of real property by the Bank as a mortgagee, as a result of
an unsuccessful auction held as part of enforcement proceedings or foreclosure of another fixed asset or securities by the Bank, as a creditor
secured by a registered pledge pursuant to the provisions of the Act on registered pledge and the register of pledges, or as a creditor secured
by a transfer of title to secure loan repayment pursuant to the provisions of the Banking Law Act;
to review the Management Board reports and proposals concerning profit distribution and loss coverage;
to set remuneration for the President and members of the Management Board;
to conclude agreements on behalf of the Bank with members of the Management Board (where authorised to do so), including employment
contracts and management contracts (the Supervisory Board may appoint its Chairman or another member of the Supervisory Board to make
statements of will in this respect);
to adopt the Terms of Reference of the Bank’s Management Board and other terms of reference and rules provided for by the Statutes or law,
and to approve the Bank’s Organisational Regulations and Policy on internal control system;
to appoint an entity authorised to audit the Bank’s financial statements and to conduct financial audits in the Bank;
to request consent from the KNF to appoint two Management Board members, including the President of the Management Board;
to inform the KNF about:
other Management Board members and each change in the Management Board composition;
compliance of the Management Board members with the criteria set out in the Banking Law Act, after performing the
compliance assessment;
approving and changing the distribution of duties within the Management Board;
including the information on the Management Board member in charge of material risk in the Bank’s operations;
to appoint and remove the President and other members of the Management Board;
to suspend the Management Board members for important reasons and delegate the Supervisory Board members to perform the role of the
suspended Management Board members;
to present the Annual General Meeting with a brief assessment of the Bank’s situation, including the assessment of the internal control system
and the material risk management system;
to approve the policies developed by the Management Board: risk management policy, risk appetite, internal capital assessment and
maintenance policy, internal control policy, remuneration policy, for each category of material risk takers;
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
157
to approve the distribution of duties within the Management Board as decided by the Management Board;
to review the matters to be considered by the General Meeting.
The Supervisory Board takes decisions in the form of resolutions which are adopted by absolute majority in open voting. The Supervisory Board adopts
resolutions in a secret ballot in the cases stipulated by law. The Supervisory Board meetings are held as and when required and at least three times in
any financial year. The Supervisory Board members convene in a single location, or in different locations using remote communication channels.
Selected forms of communication with the shareholders
Each year, the Supervisory Board prepares and presents to the Annual General Meeting a report on its activities in the previous year,
including a summary of operations of the Supervisory Board committees, a report from the audit of the annual financial statements of
the Group and the Management Board’s proposal of profit distribution, as well as assessment of the Group’s activities (including internal
control, risk management and compliance systems and internal audit function), corporate governance practices, remuneration policy and the rationale
for sponsorship and corporate giving-related expenses. The above report of the Supervisory Board is published on the Bank’s website at least 26 days
before the General Meeting.
Adequacy assessment for regulations concerning the Supervisory Board
On 23 February 2023, the Supervisory Board self-assessed the effectiveness of its activities in line with the KNF’s Recommendation Z
no. 8.9. Having analysed the regulations in detail, the Supervisory Board found that they cover all of the required issues, are adequate
and enable it to operate efficiently and effectively as well as facilitate an effective governance over the Bank’s operations. The regulations
duly reflect the specific nature of the Bank’s operations, its size and organisational structure. Moreover, they meet all the regulatory
requirements, both in terms of the provisions of law, KNF recommendations and EBA’s guidelines on internal governance. The Bank’s General Meeting
agreed with the conclusion that the regulations are adequate and enable the Supervisory Board to operate efficiently (Resolution no. 17 of the Annual
General Meeting dated 19 April 2023).
Assessment of the efficiency and effectiveness of the Supervisory Board
On 22 March 2023, the Supervisory Board (acting jointly with the Nominations Committee) self-assessed the effectiveness of its
activities in line with KNF’s Recommendation Z no. 8.9. The Supervisory Board indicated that it duly and effectively discharged its
responsibilities arising from applicable laws, including the Commercial Companies Code, the Banking Law Act, the Bank's Statutes and
the KNF recommendations, as well as from corporate governance rules. The Bank’s General Meeting approved the foregoing self-
assessment (Resolution no. 17 of the Annual General Meeting dated 19 April 2023).
Suitability assessment
All Supervisory Board members are subject to individual suitability assessment (initial and ongoing one). The Supervisory Board is also
subject to collective suitability assessment. The foregoing processes are delivered in accordance with the Policy on suitability assessment
of Supervisory Board members in Santander Bank Polska S.A. developed in line with the Joint Guidelines of the European Securities and
Markets Authority and the European Banking Authority no. EBA/GL/2021/06, Guidelines of the European Banking Authority no. EBA/GL/2021/05 on
internal governance, taking into account applicable laws, in particular the Banking Law Act and the Commercial Companies Code. The assessment is
conducted according to the Suitability assessment methodology for members of governing bodies of supervised entities published by the KNF (“KNF’s
Suitability assessment methodology”). The individual and collective suitability assessments are conducted at least once a year and as required under the
above-mentioned policy, e.g. when candidates are proposed for the Supervisory Board positions (in this case, the assessment should be generally
performed before the formal appointment), when membership of the Supervisory Board changes or when the Bank’s business model is significantly
modified. The Supervisory Board presents the results of the suitability assessment at the next General Meeting.
Supervisory Board operations in 2023
In 2023, the Supervisory Board carried out its activities based on the adopted schedule of meetings and the general work plan adjusted
to the current circumstances. The Supervisory Board regularly requested and received from the Bank's Management Board exhaustive
materials on issues covered by the agendas of its meetings as well as those pertaining to other matters important to the Bank's
operations. The agenda of each meeting covered business issues, important developments in the Bank, matters submitted by the Bank’s Management
Board for consideration and any other issues mandated by the Supervisory Board or deemed necessary to be covered by the agenda by the Board. The
Supervisory Board’s activities are described in detail in the minutes of its meetings which, together with the adopted resolutions, are kept at the Bank’s
headquarters. Irrespective of regular meetings, the Supervisory Board members stayed in regular contact with the Bank’s Management Board members
in order to exercise comprehensive oversight of the Management Board’s operations. The individual matters were also considered by the Supervisory
Board’s Committees in accordance with their powers. In 2023, the Supervisory Board was in charge of strategy implementation, finances, relations with
external auditors, internal audit, regulatory and compliance issues, the risk management system and internal control system, as well as day-to-day issues
related to the operations of individual business lines and the Bank a whole.
The Supervisory Board committees analysed the issues within their scope of responsibility, both in detail and at the general level, and issued follow-up
recommendations to the Supervisory Board – for more information, see the section on Board committees below.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
158
Composition of the Supervisory Board
[ESRS 2 - Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies]
The table below presents the composition of the Supervisory Board of Santander Bank Polska S.A. as at 31 December 2023 and 31 December 2022.
Role in the Supervisory Board No.
Composition as at
31 December 2023
No.
Composition as at
31 December 2022
Chairman of the Supervisory Board: 1.
Antonio Escámez Torres 1. Antonio Escámez Torres
Deputy Chairman of the Supervisory Board: 2. José Luís de Mora 2. José Luís de Mora
Members of the Supervisory Board:
3.
Dominika Bettman 3. Dominika Bettman
4. José García Cantera 4. José García Cantera
5. Danuta Dąbrowska 5. Danuta Dąbrowska
6. Isabel Guerreiro 6. Isabel Guerreiro
7. David Hexter 7. David Hexter
8. Adam Celiński* 8. John Power**
9. Jerzy Surma 9. Jerzy Surma
10. Marynika Woroszylska-Sapieha 10. Marynika Woroszylska-Sapieha
* Supervisory Board Member since 1 August 2023
** Supervisory Board Member until 1 August 2023
In March 2023, the Nominations Committee of the Supervisory Board of Santander Bank Polska S.A. assessed the individual suitability of the Supervisory
Board members as well as collective suitability of the Supervisory Board of Santander Bank Polska S.A. in accordance with the applicable regulations and
the KNF’s Suitability assessment methodology. The Committee decided as follows, based on the above-listed criteria and their assigned weights: each
of the assessed persons meets the suitability criteria set out in Article 22(aa) of the Banking Law Act, i.e. with regard to knowledge, skills and experience
required to perform duties and responsibilities on the Bank’s Supervisory Board as well as gives assurance of proper exercise of these duties; meets the
criteria for reputation, honesty and ethical behaviour. In the Committee’s opinion, there are no objective and demonstrable circumstances or factors
casting doubt on the person’s good reputation and each person makes independent judgements (as per the applicable criteria) and is able to devote
sufficient time to the performance of his/her duties, also during periods of intensive activity As regards the collective suitability assessment, the
Committee unanimously stated that the structure, size, composition and effectiveness of the Supervisory Board in the current composition were suitable
and complied with the applicable regulations, in particular Article 22(aa) of the Banking Law Act. These were ongoing annual suitability assessments.
The Annual General Meeting held on 19 April 2023 approved the results of the suitability assessments.
In 2023, the composition of the Supervisory Board changed as John Power stepped down effective as of 1 August 2023 – he has retired after more than
20 years of employment with Bank Zachodni WBK and (thereafter) Santander Bank Polska. The Extraordinary General Meeting appointed Adam Celiński
as the Supervisory Board member for a three-year term of office, effective as of 1 August 2023 and based on approved suitability assessment of the
candidate and collective suitability assessment of the Supervisory Board in the proposed composition – made on 12 July 2023 by the Nominations
Committee. The assessment result indicates that the structure, size, composition and effectiveness of the Supervisory Board in the proposed composition
were suitable and complied with the applicable regulations, in particular Article 22(aa) of the Banking Law Act.
Five out of ten member of the Supervisory Board meet the independence criteria specified in the Act on statutory auditors, audit firms and public oversight,
Commission Recommendation 2005/162/EC of 15 February 2005 as well as relevant criteria stipulated in the Bank’s Statutes (as agreed with the KNF),
Terms of Reference of the Supervisory Board and Terms of Reference of the Audit and Compliance Committee. The following members of the Supervisory
Board held independent status: Dominika Bettman, Danuta Dąbrowska, David Hexter, Jerzy Surma and Marynika Woroszylska-Sapieha. Each of the above
persons made a relevant statement which is subject to suitability assessment. The results of individual and collective suitability assessments of the
Supervisory Board are approved by the General Meeting.
In 2023, the members of the Supervisory Board committed sufficient time to perform their functions. 29 Supervisory Board meetings were held during
the year at which 181 resolutions were passed. The average attendance of Supervisory Board members was 95.7% (this figure does not include one
secret ballot via means of direct communication over distance – nine out of ten Board members participated in that voting, the non-participating member
has not been identified due to the nature of the secret ballot procedure).
The table below presents the attendance of Supervisory Board members:
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
159
Role in the Supervisory Board No.
Composition as at 31
December 2023
Attendance at
meetings in 2023
No.
Composition as at 31
December 2022
Attendance at
meetings
in 2022
Chairman of the Supervisory Board: 1.
Antonio Escámez Torres 28/28 100% 1. Antonio Escámez Torres 23/23 100%
Deputy Chairman of the Supervisory
Board:
2. José Luís de Mora
28/28 100%
2. José Luís de Mora 21/23 91%
Members of the Supervisory Board:
3.
Dominika Bettman 28/28 100% 3. Dominika Bettman 23/23 100%
4. José García Cantera 23/28 82% 4. José García Cantera 21/23 91%
5. Danuta Dąbrowska 27/28 96% 5. Danuta Dąbrowska 22/23 96%
6. Isabel Guerreiro 24/28 86% 6. Isabel Guerreiro 20/23 87%
7. David Hexter 27/28 96% 7. David Hexter 23/23 100%
8. Adam Celiński* 11/11 100% 8. John Power ** 22/23 96%
9. Jerzy Surma 27/28 96% 9. Jerzy Surma 23/23 100%
10.
Marynika Woroszylska-
Sapieha
28/28 100%
10.
Marynika Woroszylska-
Sapieha
23/23 100%
* Supervisory Board Member since 1 August 2023
** Supervisory Board Member until 1 August 2023. In 2023, he attended 17/17 (100%) meetings held between 1 January 2023 and 31 July 2023.
Members of the Bank’s Supervisory Board have various academic background, extensive expertise and considerable professional experience in banking
and business, including finance, accounting, financial analysis, IT law and economics. Individual competencies and experience of the Supervisory Board
members guarantee due performance of the obligations entrusted with them, while their complementarity ensures effective discharge of collective
supervisory obligations. The diversity of the Supervisory Board in terms of gender, age, geographical provenance and length of service with the bank is
presented in Section 8 “Diversity Policy” (“Diversity policy regarding the governing bodies”).
The individual suitability assessment of Supervisory Board members (or candidates) and collective suitability assessment of the Supervisory Board (as a
whole) focuses on the expert knowledge and skills in the area of sustainable development – the Bank verifies whether the assessed persons have
knowledge, skills as well as theoretical and practical experience relating to risk management (identifying, assessing, monitoring, controlling and
mitigating the main types of risk, including environmental, governance and social risks and risk factors) and collects relevant statements from these
persons. The Bank also provides the Supervisory Board members with access to training so that they can improve their competencies in that area on an
ongoing basis. In 2023, members of the Management Board and Supervisory Board participated in training sessions on sustainable development
delivered by in-house and external experts. The topics covered legal requirements and EU regulatory frameworks, greenwashing, decarbonisation,
climate change-related risks and their impact on the Bank’s operations (including the impact on the loan portfolio, risk management methodologies, and
the ensuing opportunities and threats). Supervisory Board members attend various conferences and events concerning sustainable development. For
example, Dominika Bettman participated in the Business Accessibility Forum 2023 (organised by Fundacja Widzialni.eu) and EY Corporate Reporting
Forum, and also sits on the Programme Board of Chapter Zero Poland (a programme for the development of competencies of management and
supervisory board members). Danuta Dąbrowska attended the XIII Supervisory Board Conference held on 18 September 2023 devoted to “ESG from the
supervisory board perspective”.
At the meetings, members of the Management Board and Supervisory Board supported the initiatives aimed at increasing the Bank’s sustainable
development-related competencies (training for employees, recruitment of experts in a given area – both for business units and for 2LoD and 3 LoD
units).
The information about the academic background and professional experience of the Bank’s Supervisory Board members is presented below. It is also
published on the Bank’s website at: https://www.santander.pl/relacje-inwestorskie/informacje-o-spolce/wladze-banku.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Profiles of Members of Supervisory Board of Santander Bank Polska S.A.
Antonio Escámez Torres
Chairman of the Supervisory Board
Academic background:
Law degree from Complutense University of Madrid
Professional background:
1973–
1999: Banco Central (including the role of the Chairman and Chief Executive Officer with responsibility
for the North American operations of Banco Central, Member of the Board of Directors, Member of the
Executive Committee and Member of the Management Committee)
since 1999: Santander Group (including the role of the Member of the Board of Directors, Member of the
Executive Committee, Member of the Management Committee, Member of the Banco Santander International
Advisory Board and Member of Technology and International Committees)
2009-2018: Chairman of Spain India Council Foundation
2007-2018: Chairman of Banco Santander Foundation
1994-2018: Vice Chairman of Attijariwafa Bank
since 1999: Santander Consumer Finance S.A.: Chairman of the Board of Directors (1999–2020) and Non-
Executive Director (since 2020)
José Luís De Mora
Deputy Chairman of the Supervisory
Board
Academic background:
Graduate of ICADE University (Law and Economics)
MBA degree from Boston College
Chartered Financial Analyst
Professional background:
1992–1994: Corporate Finance at Bank of Spain and Daiwa Securities
1994–1998: Analyst with Kleinwort Benson (London), responsible for Spain’s equity and banking market
1998–2003: Analyst with Merrill Lynch (London), responsible for pan-European banks, including Spanish,
French and Italian banks
since 2003: Santander Group (currently: Senior Vice President supervising financial planning and corporate
development, responsible for planning an organic growth strategy, corporate acquisitions and Group’s
expansion)
2012–2015: Member of the Board of Sovereign Bank NA
2012–2013: Member of the Board of Santander Consumer USA
since 2015: Member of the Board of Santander Consumer Finance S.A.
since 2011: Deputy Chairman of the Supervisory Board of Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Dominika Bettman
Independent Member of the Supervisory
Board
Academic background:
Graduate of Warsaw School of Economics, Foreign Trade Faculty,
and IESE Advanced Management Programme in Barcelona
Professional background:
Employed for approx. 25 years with Siemens Polska:
1995-1997: Logistics Manager, Siemens Nixdorf Polska
1997-2002: Senior Commercial Manager, Siemens sp. z o.o.
2002-2007: Finance Director at Siemens IT (until 2004) and Siemens Telecommunication (from 2004)
2007-2009: Member of the Management Board and Chief Financial Officer, Nokia Siemens Network
2009-2018: Chief Financial Officer, Siemens sp. z o.o.
2018-2021: President of the Management Board of Siemens sp. z o.o.
2015-2019: Member of the Supervisory Board of Eurobank S.A.
2019-2021: Head of Digital Industries at Siemens Polska
since 2021: President of the Management Board of Microsoft Polska sp. z o.o.
since 2020: Member of the Supervisory Board of Santander Bank Polska S.A.
José García Cantera
Member of the Supervisory Board
Academic background:
MBA degree from IE Business School
Professional background:
until 2003: Latin America stock analyst; senior executive positions at Salomon Brothers-Citigroup
2003: Senior Vice President in charge of Global Banking and Markets Division of Banesto
2006–2012: CEO of Banesto
2012–2015: Head of Global Banking and Markets of Santander Group
since 2015: Senior Vice President, Chief Financial Officer and Head of the Finance Division of Banco Santander
S.A.
Chairman of the Board of Santander de Titulizaciones SGFT and Santander Investment S.A.
since 2015: Member of the Supervisory Board of Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Danuta Dąbrowska
Independent Member of the Supervisory
Board
Academic background:
MA degree from the University of Horticulture and Food Industry
in Budapest
since 1999: Member of the Association of Chartered Certified
Accountants (ACCA)
Completed the Advanced Strategic Management Programme at
IMD, Switzerland, and “Best-In-Retail” Programme at Harvard
Business School
Founding Member of FINEXA (Polish Association for Finance
Directors)
Professional background:
1991–1993: Financial Assistant, Arthur Andersen & Co., Warsaw
1993–1997: Audit Manager, Coopers & Lybrand
1997–2001: Head of Financial and Business Control Department of Ericsson, Warsaw and Stockholm
2002–2003: CFO of TP Internet (France Telecom Group)
2004–2008: Member of the Board, CFO (for Eastern Europe and Middle East) at ECCO Sko A/S
2009-2019: Member of the Board, Vice President, CFO for Eastern Europe, Pandora Jewelry CEE
2012–2017: Member of the Supervisory Board of Herkules S.A.
2016–2018: Member of the Board, Vice President, CFO for Middle East and Africa in Panmeas Jewellery LLC
(Pandora)
since 2014: Member of the Supervisory Board of Santander Bank Polska S.A.
2018-
2021: Member of the Audit Committee at the Polish Council of Shopping Centres (Polska Rada Centrów
Handlowych)
since 2019: Member of the Supervisory Board and Chairman of the Audit Committee at Budimex S.A.
since 2022: Co-founder of Grupa Oryx sp. z o.o.
since 2023: Member of the Supervisory Board and Audit Committee of VRG S.A. (Vistula Retail Group)
Isabel Guerreiro
Member of the Supervisory Board
Academic background:
MEng degree in Computer Software Engineering from Instituto
Superior Técnico in Lisbon and MBA degree from INSEAD
Graduate of Strategic Finance in Banking at Wharton Business
School
Completed a number of specialist courses for senior executives,
e.g. Design Thinking BootCamp at Stanford University, and
Driving Digital and Social Strategy at Harvard University
Professional background:
1992–1994: Lecturer in Computer Science at Instituto Superior Técnico in Lisbon
1995–2003: Programmer, System Analyst, Project Manager and Senior Manager at Novabase Sistemas de
Informação S.A.
Since 2005, employed with Banco Santander Totta S.A., Portugal:
2005-2006: Sub-Director of Retail Banking
2006–2008: Member of the Retail Banking Office
2009-2013: Head of Branch Network Dynamics
2013-2014: Head of Wholesale Strategy
2014-2018: Head of Digital Transformation in charge of traditional and digital channels
Board Member in charge of Digitalisation and Transformation (since January 2019)
since 2019: Member of the Supervisory Board of Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
David R. Hexter
Independent Member of the Supervisory
Board
Academic background:
Graduate of Oxford University (Philosophy, Politics and
Economics) and University College London (Legal and Political
Theory)
MBA degree from Cranfield School of Management
MPhil degree from Birkbeck College London and PhD degree
from Queen Mary University of London
Professional background:
1970–1992: Executive positions at Citibank N.A. in Europe and the USA, including:
1986: Senior Credit Officer
1989–1992: Division Executive for Central and Eastern Europe
1992–2004: European Bank for Reconstruction and Development:
1992–1996: Head of the Financial Institutions Department
1996–2004: Deputy Vice President of the Banking Department; Chairman of the Equity Investment
Committee, responsible for approval of EBRD loans and projects
since 2004: Independent Director and Consultant to a number of commercial firms, banks and equity funds
operating in Russia, Kazakhstan, Denmark, Vietnam and Greece
since 2013: Member of the Supervisory Board of Santander Bank Polska S.A.
since 2016: Member of the Board of Piraeus Bank
Adam Celiński
Member of the Supervisory Board
Academic background:
Master’s degree from SGH Warsaw School of Economics.
master’s degree in Philosophy in International Finance at the
Glasgow University.
1996: member of the Association of Chartered Certified
Accountants (ACCA)
1999: awarded the UK Audit Practicing Certificate
2000: member of PIBR (Polska Izba Biegłych Rewidentów, a self-
government uniting all Statutory Auditors in Poland)
Professional background:
1984–1990: employed with the Ministry of Finance
1990–1991: employed with KPMG in Warsaw.
1991–2021: employed with PricewaterhouseCoopers (PwC), in particular:
2015-2018: as the Financial Services Leader and Risk Management Partner for Eurasia in PwC office in
Almaty in Kazakhstan;
2008–2015: the Financial Services Leader in Poland and the Baltic states; and at the same time the Risk
Management Partner in Poland and the Baltic states (and subsequently in Poland, Slovakia and
Hungary.)
2001: partner in the Audit department of PwC Central and Eastern Europe partnership (PwC CEE)
since 2023: member of the Supervisory Board of Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Jerzy Surma
Independent Member of the Supervisory
Board
Academic background:
Graduate of the Wrocław University of Technology (Computer
Science and Management)
PhD in Economic Science from the Wrocław University of
Economics
Completed the IFP programme at IESE Business School and
Executive Programme at MIT Sloan School of Management
Professional background:
1999–2002: Head of the Software Development Department of T-Systems Polska
2002–2006: Director in charge of Business Consulting in IMG Information Management Polska responsible
for the implementation of Business Intelligence systems, re-engineering business processes, IT advisory
since 2006: Academic at Warsaw School of Economics (currently: Associate Professor in Collegium of
Economic Analysis, 2018–2019: Head of Post-graduate Business Intelligence and Cybersecurity Management
Studies)
2008–2017: Member of the Supervisory Board of Kęty Group
2011–2014: Visiting Scholar (Harvard Business School, University of Massachusetts)
since 2012: Member of the Supervisory Board of Santander Bank Polska S.A.
2018-2019: Head of the National Cryptology Centre (Narodowe Centrum Kryptologii)
Marynika Woroszylska-Sapieha
Independent Member of the Supervisory
Board
Academic background:
Graduate of the Medical University of Warsaw and INSEAD
International Executive Programme in Fontainebleau
Member of INSEAD Alumni Club; awarded the National Order of
the Legion of Honour
Professional background:
Many years of service with the Institute of Cardiology in Anin as part of the team responsible for introducing
new techniques in the field of interventional cardiology
Started her professional career in the pharmaceutical industry in 1994: until 1996 with Infa Biocom, since
1998 with Sanofi Group (President of the Management Board and General Manager of the branch in Poland
in 2004–2015)
since 2016: Advisor to the President of the Management Board of Polpharma Group
since 2017: Member of the Supervisory Board of Polpharma Group
2005–
2012: Member of the Management Board of INFARMA (Employers’ Union of Innovative Pharmaceutical
Companies) in charge of activities related to the code of ethics and the transparency directive, protection of
intellectual property rights and promotion of innovation in Poland
2012–2014: President of the Management Board of INFARMA
since 2014: Member of the Supervisory Board of Santander Bank Polska S.A.
Supervisory Board committees
The Supervisory Board may establish committees and designate individuals responsible for managing the work of such committees. These committees
are designed to facilitate the current activities of the Supervisory Board by preparing draft Supervisory Board recommendations and decisions with regard
to their own motions or the motions presented by the Management Board.
The following Supervisory Board committees operate in Santander Bank Polska S.A.: Audit and Compliance Committee, Risk Committee, Nominations
Committee and Remuneration Committee. The responsibilities of these committees are set out in their respective terms of reference introduced by virtue
of the Supervisory Board resolutions.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The table below presents the membership of the Supervisory Board committees and attendance at the their meetings.
Composition of the Supervisory Board committees and attendance of their
members
at the meetings in 2022 and 2023
Role in the Supervisory
Board No.
Members
of the Supervisory Board
as at 31 December 2023
Audit and
Compliance
Committee
Risk Committee
Nominations
Committee
Remuneration
Committee
2023 2022 2023 2022 2023 2022 2023 2022
Chairman of the Supervisory
Board:
1.
Antonio Escámez Torres
Deputy Chairman of the
Supervisory Board:
2.
José Luis de Mora
4/5 4/4 5/7 6/6
Members of the Supervisory
Board:
3. Dominika Bettman 9/9 8/8 6/6 6/6 7/7 6/6
4. José Garcia Cantera
5. Danuta Dąbrowska 8/9 8/8 5/5 4/4 7/7 6/6
6. Isabel Guerreiro
7. David Hexter 9/9 7/8 6/6 5/6 5/5 4/4
8. Adam Celiński* 2/2
9. Jerzy Surma 9/9 8/8 6/6 6/6 5/5 4/4
10.
Marynika Woroszylska-
Sapieha
9/9 8/8 5/5 4/4 7/7 6/6
Number of meetings in a given year
9 8 6 6 5 4 7 6
*
Supervisory Board Member and Risk Committee member since 1 August 2023
** Having stepped down as a member of the Supervisory Board, on that date John Power also resigned as Risk Committee member In 2022, he attended 5/6 meetings of
the Committee, and between 1 January 2023 and 31 July 2023: 4/4 meetings.
The operations of the Supervisory Board committees in the last year is presented below, and it will be discussed in more detail in the report on activities
of the Supervisory Board in 2023, which will be submitted to the next General Meeting of Santander Bank Polska S.A. and published in due course before
that meeting.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Audit and Compliance Committee
The Audit and Compliance Committee supports the Supervisory Board in fulfilment of its oversight obligations towards shareholders and other
stakeholders in terms of:
the quality and integrity of the accounting policies, financial statements and disclosure practices;
compliance of the Bank’s business with laws and internal regulations;
independence and effectiveness of activities undertaken by internal and external auditors;
internal control system and risk management system.
The Committee also establishes procedures for auditor selection by the Bank (the main assumptions of the Policy of Auditor Selection at
Santander Bank Polska S.A. are presented in Section
9 “External Auditor”, Subsection “Selection of the external auditor”), develops the auditor
services policy, as well as prepares and submits recommendations to the Supervisory Board regarding appointment, re-appointment and
removal of the external auditor in accordance with the applicable laws and the Policy of Auditor Selection at Santander Bank Polska S.A. The
Committee assesses the independence of the statutory auditor, gives consent for such auditor to render other permitted non-audit services at
the Bank and monitors financial audits.
An important role of the Committee is also to support the Supervisory Board in overseeing the compliance function and compliance risk
management. To that end, the Committee conducts regular reviews of key compliance matters and changes in the regulatory environment, and
assesses measures taken by the Management Board in this respect.
In 2023, the Audit and Compliance Committee:
- reviewed the following documents and submitted them to the Supervisory Board for approval: the Bank’s audited financial statements for
2022, financial statements of the Bank and the Group for Q1, Q3 and H1 2023, as well as condensed interim special-purpose financial
statements of Santander Bank Polska S.A. for the 9-month period ended 30 September 2023 (produced for the needs of an interim dividend
payment in 2023);
- reviewed the following documents and submitted them to the Supervisory Board for approval: Capital Adequacy Report and Report on
Disclosure Committee Operations in 2022 as well as the Condensed Capital Adequacy Report of the Group as at 30 June 2023;
- issued a recommendation to the Supervisory Board to appoint PricewaterhouseCoopers Polska spółka z ograniczoną odpowiedzialnością Audyt
sp.k. to review and audit the financial statements of the Bank and the Group for 2024;
- approved the assignment of permitted non-audit services to the external auditor, including:
review of interim financial statements of the Bank/ Group;
verification of consolidation packages;
verification of capital adequacy disclosures;
verification of reports on remuneration of the Management and Supervisory Boards;
services connected with an issue prospectus;
assurance services related to safekeeping of customers’ assets;
assurance services related to corporate social responsibility for the period ended 31 December 2023
assurance services related to risk management and prospectuses for Santander TFI S.A.
- additionally reviewed and monitored the implementation of the external auditor's recommendations arising from the auditor's letter to the
Bank's Management Board on the 2022 audit. Details of the cooperation with the auditor and the expenses related to these services are
presented in Section 10 "External auditor”;
- supervised the activity of the Internal Audit Area on a regular basis and monitored the Audit Plan delivery on an ongoing basis (including the
status of recommendations, review of the report on the delivery of the quality assurance programme in 2022);
- reviewed the reports of the head of Internal Audit in Santander Brokerage Poland (as part of its oversight of the internal audit function);
- monitored the operations of the compliance unit in 2023, as well as assessed and recommended to the Supervisory Board the approval of the
2023 Compliance Programme;
- reviewed the compliance risk reports.
Pursuant to the Act on statutory auditors, audit firms and public oversight, the majority of audit committee members should meet the statutory
independence criteria, which are also specified in the Bank’s Statutes (please note that this does not mean the “independence of mind” mentioned in
Article 22a of the Banking Law Act or in the suitability assessment criteria for members of the Bank’s Management Board and Supervisory Board
applicable under Guidelines no. EBA/GL/2021/06 and KNF’s Suitability assessment methodology – rather, it means the independence as defined in Article
129 (3) of the Act on statutory auditors, audit firms and public oversight). In accordance with the Principles of Corporate Governance for Supervised
Institutions, particularly members of the audit committee should have an independent status. KNF’s “Best practice for public interest entity on the rules
for appointment, composition and operations of the Audit Committee” (a document binding for the Bank) stipulate that “audit committee member is
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
deemed independent if they have no financial interest related to the entity they control except for the remuneration received for the role performed as a
member of the supervisory board or other supervisory or controlling body (including the audit committee) of that entity”.
The Bank goes beyond the statutory requirement and applies it to all members of the Audit and Compliance Committee (in line with the Act, the majority
of audit committee members are independent). In the Bank’s opinion, such approach is beneficial both for minority shareholders and transparency of the
Bank’s operations as well as facilitates efficient oversight in the company. It complies with the best practices developed in Santander Group – the Group-
Subsidiary Governance Model assumes that all members of the Audit Committee meet the independence criteria. It means that no Committee member
has been a member of the Management Board of the Bank or its connected entity over the last five years, has not been an employee of the Bank or its
connected entity over the last three years, has not received additional substantial remuneration from the Bank or its connected entity except for
remuneration for performing their role on the Supervisory Board, is not a shareholder of the parent entity and does not represent it, has not had actual
and material connections with a shareholder holding at least 5% of total voting power at the Bank’s General Meeting. The suitability assessment also
takes into account the Audit Committee member’s employment with other companies in the context of actual and potential conflicts of interest.
Furthermore, all members of the Audit and Compliance Committee have independence of mind understood as an ability to make their own sound,
objective and independent decisions and judgments when performing their functions and responsibilities. Such behavioural skills are assessed at least
once a year as part of assessment of suitability of individual Supervisory Board members conducted in accordance with the Suitability assessment
methodology published by the KNF.
In line with the criteria indicated in the “Best practices for public interest entities relating to the appointment, composition and operations of the audit
committee”, the following members of the Audit and Compliance Committee are deemed to have relevant knowledge and skills in accountancy and
examination of financial statements:
1) hold a chartered auditor’s licence, ACCA certificate (Association of Chartered Certified Accountants):
Danuta Dąbrowska.
2) have at least two-year professional experience connected directly with financial accounting, management accounting or financial statements auditing.
In other cases, the knowledge and skills of the candidate can be confirmed by: 1) education in the field of accounting or financial statements auditing
confirmed by a university degree diploma or specialist courses and training in accounting or financial statement auditing confirmed by a certificate or
other documents, and (2) accounting or financial statements auditing skills gained during the professional career”:
Dominika Bettman: degree in economics and extensive professional experience gained in previous positions, including as CFO at companies
from Siemens Group.
David Hexter: degree in economics, professional experience gained in executive positions in financial institutions.
The following Committee members have knowledge and skills in the area of banking:
David Hexter: competencies gained in executive positions in the banking and financial services sectors, including in Citibank and the EBRD.
Dominika Bettman: competencies gained as the Member of the Supervisory Board of Eurobank S.A.
Apart from the Committee's members, the attendees included the representatives of the Bank’s Auditor, Vice President of the Management Board in
charge of the Risk Management Division, member of the Management Board in charge of the Financial Accounting and Control Division, member of the
Management Board in charge of the Financial Management Division, member of the Management Board in charge of the Compliance and FCC Division,
Head of the Internal Audit Area (Chief Audit Executive) and Head of the Compliance Area. Other members of the Management Board and executives are
also invited to attend the Committee meetings to present reports and discuss issues related to the areas under their management.
Risk Committee
The Risk Committee is specifically responsible for:
issuing opinions on the Bank’s current and future risk propensity;
issuing opinions on the risk management strategy developed by the Bank's Management Board and supervising its delivery;
supporting the Supervisory Board in overseeing the implementation of the risk management strategy by the senior management;
checking if the prices of liabilities and assets offered to customers match the Bank’s business model and risk management strategy,
and if not – making a proposal to the Management Board to ensure adequacy of asset and liability prices in relation to different risk
types;
issuing opinions in relation to appointment and removal of the Management Board member in charge of risk management and
opinions on his/her annual objectives and their delivery.
The Risk Committee convenes at least four times per year at dates corresponding to the reporting and audit cycle. Additional meetings are held when
necessary. In 2023, six Committee meetings were held.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
When performing its responsibilities, the Committee takes into account the fact that risk-taking by the Bank has to be adequate to the scale and profile
of its business. Risk management is governed by the industry standards and regulatory guidance and recommendations concerning, among other things,
operational risk, credit risk, market risk and liquidity risk. The Committee provided support to the Supervisory Board in exercising continued oversight
over all risks related the Bank’s operations.
In 2023, the Committee focused on the risks related to: the war in Ukraine, the Bank’s IT environment, the CHF loan portfolio (including provision-related
issues) and loan payment holidays (including solutions proposed by the government for the upcoming years), as well as on the cost of risk. The
Committee also monitored the current macroeconomic situation and its impact on the level of risk.
Nominations Committee
The Nominations Committee supports the Supervisory Board in performing its tasks, issues recommendations on the appointment and removal
of members of the Supervisory Board, Management Board and other key function holders by the Bank’s relevant bodies, and contributes to the
performance of the Bank's duties with respect to the assessment of the suitability of members of the Supervisory Board, Management Board
and key function holders.
The Nominations Committee holds regular meetings at last four times a year, as per the schedule agreed upon at the beginning of the year. Additional
meetings are held when necessary. In 2023, five Committee meetings were held.
In 2023, the Nominations Committee focused on: (i) suitability assessment of the members of the Management Board and Supervisory Board and
candidates for members of the Bank’s bodies as well as on the suitability assessment of these governing bodies as a whole; (ii) succession plans; (iii)
review of the diversity policy and policies concerning the suitability assessment, selection, appointment and succession planning.
Remuneration Committee
The Remuneration Committee supports the Supervisory Board in performing its tasks concerning remuneration of members of the Bank’s
governing bodies and key function holders, reviews and monitors the Remuneration Policy and supports the General Meeting, the Supervisory
Board and the Management Board in developing and implementing that Policy.
The Committee holds regular meetings four times a year, as per the schedule agreed upon at the beginning of the year.
Additional meetings are held when necessary. In 2023, seven Committee meetings were held.
In 2023, the Remuneration Committee:
- reviewed the Management Board members’ performance and set their targets for 2023 (including the target matrix for Management Board
members for the needs of the Long Term Incentive Plan VII);
- recommended the 2022 bonus for Management Board members, the Head of Internal Audit Area and the Head of Compliance;
- reviewed and assessed the compliance with the triggers for payment of variable remuneration to the individuals with the status of Identified
Employees and recommended that the Supervisory Board should approve the payment of certain deferred portions of variable remuneration
payable in 2023;
- reviewed the bonus schemes for key executives, management, employees of the Business Support Centre and branch banking employees;
- recommended the amount of remuneration for newly-appointed members of the Management Board;
- reviewed and evaluated the current remuneration policy;
- reviewed and identified the Material Risk Takers;
- reviewed the existing remuneration levels and the Management Board’s decisions on adjustment of remuneration levels;
- reviewed the remuneration levels for members of the Management Board and Supervisory Board and issued change recommendations;
- confirmed that requirements for 2022 bonus payment have been fulfilled for participants of the Incentive Plan VII as well as
- reviewed the internal regulations within the scope of the Committee’s operations.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Management Board
Appointment and removal of executives
Members of the Management Board of Santander Bank Polska S.A. are appointed and removed in accordance with the Commercial
Companies Code, Banking Law Act and the Bank’s Statutes.
The Bank’s Management Board consists of at least three persons (including the Management Board President) appointed by the Supervisory Board for a
joint three-year term of office. Terms of office are set in full financial years. At least half of the Management Board members (including the Management
Board President) are required to speak Polish, have a university degree, be permanent residents of Poland, have good knowledge of the Polish banking
sector and experience of the Polish market to manage a Polish banking institution. Two Management Board members, including the Management Board
President, are appointed with the approval of the KNF. Management Board members may be removed by the Supervisory Board or the General Meeting
at any time.
The term of office of the Management Board member expires no later than on the date of the General Meeting held to approve the financial statements
for the last full financial year in which the member served on the Management Board. It also expires as a result of the member's death, resignation or
removal. The term of office of the Management Board member who was appointed before the end of the term of the Management Board expires at the
same time as those of the remaining members.
All Management Board members are subject to individual suitability assessment (initial and ongoing). The Management Board is also subject to collective
suitability assessment. The foregoing processes are delivered in accordance with the Policy on suitability assessment of Management Board members
and key function holders in Santander Bank Polska S.A. developed in line with the Joint Guidelines no. EBA/GL/2021/06, Regulation of the Minister of
Finance of 7 May 2018 on specific tasks of the nomination committees in significant banks, and other applicable laws, in particular the Banking Law Act
and the Commercial Companies Code. The assessment is also conducted according to the KNF’s Suitability assessment methodology. The individual and
collective suitability assessments are conducted at least once a year and as required under the above-mentioned policy, e.g. when candidates are
proposed for the Management Board positions (in this case, the assessment should be generally performed before the formal appointment), when
membership of the Management Board changes or when the Bank’s business model is significantly modified.
Pursuant to Article 22b(1) of the Banking Law Act, the Management Board President and the Management Board member in charge of material risk
management are appointed with the approval of the KNF. Such approval was required in relation to the appointment of Michał Gajewski as the President
of the Management Board and Andrzej Burliga as the Vice President of the Management Board in charge of the Risk Management Division and the
Business Intelligence Area.
The individual and collective suitability assessments confirmed that each member of the Management Board and the Management Board as a whole
have appropriate knowledge and skills and meet all the suitability criteria to perform their functions.
Powers of executives
The Management Board of Santander Bank Polska S.A. manages and represents the Bank.
The Management Board takes decisions to raise obligations or transfer assets where the total value for one entity exceeds 5% of the
Bank’s own funds. It may also, by way of resolution, delegate its powers to take such decisions to other committees or persons at the Bank.
The Management Board members run the Bank’s affairs jointly, and in particular: define the Bank’s mission, set long-term action plans and strategic
objectives, prepare assumptions for the Bank’s business and financial plans, approve proposed plans and monitor their performance, regularly report to
the Supervisory Board on the Bank’s position in the scope and at the dates agreed with the Supervisory Board, appoint permanent or ad hoc committees
and designate individuals responsible for managing the work of such committees. The committees are composed of both Management Board members
and persons from outside the Management Board.
Management Board members acting severally do not have any specific powers and cannot take decisions on issuing or redeeming shares.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Standing committees operating at the Bank include:
•
Assets and Liabilities Committee
(ALCO)
•
Credit Policy Forum for Retail
Credit Portfolios
• Credit Policy Forum for SME Credit
Portfolios
• Credit Policy Forum for Business
and Corporate Credit Portfolios
• Provisions Committee
•
Operational Risk Management
Committee (ORMCO)
• Disclosure Committee
•
Information Management
Committee
• Risk Management Committee
•
Model Risk Management
Committee
• Marketing Forum
•
Urban Regeneration Fund
Investment Committee
• Regulatory and Reputational Risk
Committee
• AML Decision Committee
• AML Operating Committee
•
Procurement Investment
Committee
• Credit Committee
• Local Marketing and Monitoring
Committee
•
Public Policy Committee
•
Responsible Banking and
Corporate Culture Committee
• Capital Committee
• Suppliers Panel
• Capital Stress Test Forum
• Investment Advisory Committee
• Risk Control Committee
•
Special Situations Management
Committees (Gold, Silver, Bronze
Group)
• General Compliance Committee
•
Market and Investment Risk
Committee
Rules of procedure of the Management Board
The Management Board operations are primarily governed by Banking Law Act, the Commercial Companies Code, the Bank’s Statutes
and the Terms of Reference of the Management Board, available on the Bank’s Investor Relations website, section: Corporate
documents”.
According to the Bank’s Statutes, the following individuals are authorised to represent and bind the Bank: a) the Management Board
President acting individually, and b) two members of the Management Board acting jointly, or a member of the Management Board acting jointly with a
commercial representative (prokurent), or two commercial representatives acting jointly. Attorneys may be appointed and authorised to act individually
or jointly with any of the persons indicated in b) or with another appointed and authorised attorney.
The Management Board deals with all issues which have not been restricted to the remit of the General Meeting or the Supervisory Board. The
Management Board takes decisions in the form of resolutions which are adopted by absolute majority in open voting.
The Management Board adopts resolutions in a secret ballot in cases stipulated by law. Management Board meetings are held as required. The
Management Board members convene in a single location, or in different locations using remote communication channels.
Adequacy assessment for regulations concerning the Management Board
On 20 February 2023, the Management Board self-assessed the effectiveness of its activities in line with KNF’s Recommendation Z no. 8.9 –
these activities were considered adequate and effective. Next, i.e. on 23 February 2023, the Supervisory Board analysed these regulations,
approved the self-assessment results and determined that the regulations duly reflected the specific nature of the Bank’s operations, its size and
organisational structure. Moreover, they meet all the regulatory requirements, both in terms of the provisions of law, KNF recommendations and
EBA/GL/2021/14 guidelines on internal governance.
Assessment of the efficiency and effectiveness of the Management Board
On 5 July 2023, the Supervisory Board self-assessed the effectiveness of its activities in line with KNF’s Recommendation Z no. 8.9.
The Management Board stated it had duly and effectively managed the Bank and discharged its responsibilities arising from applicable
laws, including the Commercial Companies Code, the Banking Law Act, the Bank's Statutes and the KNF recommendations, as well as
from corporate governance rules. On 16 July 2023,the Supervisory Board assessed the Management Board and concluded that it operated
in an effective and efficient manner. This assessment recognised the better-than-planned financial results achieved by the Bank, excellent delivery of the
strategy and compliance with capital ratio requirements. Key internal and external factors affecting the Bank were also taken into account, such as: high
and persistent inflation, interest rate monetary policy, the war in Ukraine, very high volatility of the PLN exchange rate over the last 12 months,
implementation of the so-called payment holidays, changes in taxation introduced by the state under the so-called “New Polish Deal”, challenges in the
labour market (talent acquisition and retention).
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Composition of the Management Board
[ESRS 2 - Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies]
The table below presents the composition of the Management Board of Santander Bank Polska S.A. as at 31 December 2022 and 31
December 2023 and the roles and responsibilities of its members. The Bank’s organisational structure is presented in Part 1 of Chapter
X “Organisational and infrastructure development”.
Role in
the
Managem
ent Board
No.
Composition as at
31 December 2023
Reporting area
as at 31 December 2023
No.
Composition as at
31 December 2022
Reporting area as at
31 December 2022
President
of the
Managem
ent Board:
1. Michał Gajewski
1) Internal Audit
2) Legal Area
3) Other units outside of the
divisional structure:
Corporate Communication and
Marketing Area, Customer Excellence
Centre, Corporate Governance
Department, Corporate Governance
Department, Classified Data
Protection Unit
1. Michał Gajewski
Units reporting directly to the
President:
1) Legal and Compliance Division
2) Units outside the divisional
structure:
Internal Audit Area, Corporate
Communication and Marketing Area,
Corporate Governance Department,
Classified Data Protection Unit
Vice
President
s of the
Managem
ent Board:
2. Andrzej Burliga
1) Risk Management Division
2) Business Intelligence Area (unit
outside the divisional structure)
2. Andrzej Burliga
1) Risk Management Division
2) Business Intelligence Area (unit
outside the divisional structure)
3.
Juan de Porras
Aguirre
Corporate and Investment Banking
Division
3.
Juan de Porras
Aguirre
Corporate and Investment Banking
Division
4. Arkadiusz Przybył
1)
Wealth Management and Insurance
Division
4. Arkadiusz Przybył
1) Retail Banking Division
2) Branch Network
Members
of the
Managem
ent Board:
5. Lech Gałkowski
Business and Corporate Banking
Division
5. Lech Gałkowski
Business and Corporate Banking
Division
6. Patryk Nowakowski Digital Transformation Division 6. Patryk Nowakowski Digital Transformation Division
7. Maciej Reluga Financial Management Division 7. Maciej Reluga Financial Management Division
8.
María Elena Lanciego
Pérez
2)
Financial Accounting and Control
Division
8.
Carlos Polaino
Izquierdo
Financial Accounting and Control
Division
9. Dorota Strojkowska Business Partnership Division 9. Dorota Strojkowska Business Partnership Division
10. Artur Głembocki
3)
Compliance and FCC Division n/a n/a
11.
Magdalena Proga-
Stępień
4)
1) Retail Banking Division
2) Branch Network
n/a n/a
1) Until 4 April 2023, Arkadiusz Przybył served as the Vice President of the Management Board in charge of the Retail Banking Division. Since the establishment of a new
Wealth Management and Insurance Division on 4 April 2023, he has had the role of Vice President of the Management Board in charge of that division.
2) From 1 January 2023 to 31 December 2023. Replaced by Wojciech Skalski on 1 January 2024.
3) Since 14 November 2023
4) Since 4 April 2023
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The composition of the Management Board changed during the previous year.
Until 4 April 2023, Arkadiusz Przybył was the Vice President of the Management Board in charge of the Retail Banking Division. Since the establishment
of a new Wealth Management and Insurance Division on 4 April 2023, he has had the role of Vice President of the Management Board in charge of that
division. Magdalena Proga-Stępień, previously the Head of Distribution, was appointed as the Management Board member in charge of the Retail Banking
Division as of 4 April 2023.
On 14 November 2023, Artur Głembocki, who up to that point was the Head of Risk Management and Deputy Chief Risk Officer, was appointed as the
Management Board member in charge of the newly established Compliance and FCC Division.
On 1 January 2024, a new member of the Management Board in charge of the Financial Accounting and Control Division was appointed. On 26 October
2023, María Elena Lanciego Pérez resigned from this position, effective as of 1 January 2024. On 13 December 2023, the Supervisory Board appointed
Wojciech Skalski, the Head of the Financial Accounting Area, in her place.
Suitability assessment, knowledge and skills related to sustainable development
[ESRS 2 - Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies]
The individual and collective suitability assessments confirmed that each member of the Management Board and the Management Board as
a whole have appropriate knowledge and skills and meet all the suitability criteria to perform their functions. They are also an important and clear sign
that the Bank has proper succession plans in place, and therefore ensures stable management and long-term development of talents within the
organisation as well as recognises the professional experience and longtime engagement in the development of the Bank.
The professional activities of the Management Board members focused on the performance of obligations connected with their role in the Management
Board and this was their main task. The Management Board members complied with the limitation of the positions held with other companies, as
stipulated in Article 22aa of the Banking Law Act. The succession of the Management Board members and the continued delivery of the business
processes at the senior management levels is ensured by the Nomination and Succession Planning Policy for Management Board Members and Key
Function Holders at Santander Bank Polska S.A. and the succession plans in place.
As in the case of the Supervisory Board, the individual suitability assessment of Management Board members (or candidates) and collective suitability
assessment of the Management Board (as a whole) focuses on the expert knowledge and skills in the area of sustainable development – the Bank verifies
whether or not the assessed persons have knowledge, skills as well as theoretical and practical experience relating to risk management (identifying,
assessing, monitoring, controlling and mitigating the main types of risk, including environmental, governance and social risks and risk factors) and
collects relevant statements from these persons. In line with the new version of the KNF’s Suitability assessment methodology (issued in August 2023),
the Bank recognises the level of ESG knowledge when performing the suitability assessment. Management Board members have demonstrated their
competencies in this area. Moreover, they still develop their expertise in this area through training organised by the Bank: in 2023, members of the
Management Board and Supervisory Board participated in training sessions on sustainable development delivered by in-house and external experts. The
topics covered legal requirements and EU regulatory frameworks, greenwashing, decarbonisation, climate change-related risks and their impact on the
Bank’s operations (including the impact on the loan portfolio, risk management methodologies, and the ensuing opportunities and threats). On top of
that, members of the Management Board attended conferences and events devoted to broadly-defined sustainable development and ESG, including:
“CEOs’ debate in the shadow of the CJEU” concerning the key challenges and trends in the banking sector (including ESG-related matters), Puls Biznesu,
(CEO Michał Gajewski); “Does career have a gender? Women and men talk about work”, a discussion panel during Impact 2023 (Magdalena Proga-
Stępień); “Global ESG standards: are we there yet?”, a discussion panel during Impact 2023 (Lech Gałkowski); “Financing of energy transition projects” III
Energy Law Conference (Juan de Porras Aguirre).
The active participation of the Bank’s top executives in events themed around sustainable development and the presentation of the Bank's and the Group's
approach to a wide audience makes it possible to share experiences with leaders and ESG experts, and therefore to build knowledge and experience of
top executives and employees across the organisation.
The information about the academic background and professional experience of the bank’s Management Board members is presented below. It is also
published on the Bank’s website at: https://www.santander.pl/relacje-inwestorskie/informacje-o-spolce/wladze-banku.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Members of the Management Board of Santander Bank Polska S.A.
Michał Gajewski
President of the Management Board
Academic background:
Legal counsel
Graduate of the Adam Mickiewicz University in Poznań,
Northwestern University in Chicago and London Business
School
Professional background:
1992–
2008: WBK Group and BZ WBK Group (including the role of BZ WBK Management Board Member in
charge of Retail Banking)
2008–2011: Vice President of the Management Board of BGŻ S.A. in charge of Retail, SME and Corporate
Banking
2012–2015: Macroregional Director in the Retail Banking Division, Bank Millennium S.A.
2015: Member of the Management Board of Bank Millennium S.A. in charge of the Retail Banking Division
since 2016: President of the Management Board of Santander Bank Polska S.A.
Andrzej Burliga
Vice President of the Management Board
Risk Management Division
Academic background:
Graduate of the Faculty of Theoretical Mathematics at
Wrocław University
Completed programmes in management and risk
management (e.g. INSEAD International Executives
Development Programme, BZ WBK Development
Programme for Executives, LMC Consulting – Lilley
Moncrieff Taylor)
Member of Professional Risk Managers’ International
Association (PRMIA)
Professional background:
1995–2001: Treasury Department of Bank Zachodni S.A.
(including the role of the Head of the Department)
2001–2006: Head of the Risk Management Department at Bank Zachodni WBK S.A.
2007–2017: Member of the Management Board of Bank Zachodni WBK S.A.
since 2017: Vice President of the Management Board of Santander Bank Polska S.A. in charge of the Risk
Management Division
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Juan de Porras Aguirre
Vice President of the Management Board
Corporate and Investment Banking Division
Academic background:
Graduate of Universidad de Granada (Law)
MBA degree from Escuela Superior de Administración y
Dirección de Empresas in Barcelona
Completed the Investment Banking Executive
Programme at Northwestern University in Chicago
Professional background:
1989–1998: Commerzbank and Lloyds Bank (credit risk)
1997-2004: Société Générale (manager of relationships with telecommunication and energy companies,
Deputy Head of the Madrid-based Corporate & Investment Banking)
2004-2005: Rabobank in Madrid (responsible for building the Spanish energy and telecom sector portfolio)
2005-
2007: Senior Director at Royal Bank of Scotland in Madrid, responsible for the energy, oil and gas
sectors
since 2007: Managing Director of Global Banking & Markets at Banco Santander S.A.
2011-2017: Member of the Management Board of Bank Zachodni WBK S.A.
since 2017: Vice President of the Management Board of Santander Bank Polska S.A. in charge of the
Corporate and Investment Banking Division
Arkadiusz Przybył
Vice President of the Management Board
Wealth Management & Insurance Division
Academic background:
Graduate of the University of Łódź (Management, Finance
and Banking)
MBA degree from INSEAD, France
Professional background:
1997–2005: Engagement Manager at McKinsey & Company in Warsaw
2005–2008: Head of Retail Banking at GE Money for Central and Eastern Europe, Zurich/Paris Headquarters
2009–2010: Executive Director at GE Money Bank (Latvia) and GE Money (Latvia)
2011–
2012: Business Director in the Headquarters of Santander Consumer Finance in Madrid, responsible
for strategy development, market integration and company acquisition projects
2012–2017: President of the Management Board of Santander Consumer Bank S.A. in Wrocław
2017: Member of the Management Board of Santander Bank Polska S.A.
2018–
2023: Vice President of the Management Board of Santander Bank Polska S.A. in charge of the Retail
Banking Division and the branch network
since 2023: Vice President of the Management Board of Santander Bank Polska S.A. in charge of the Wealth
Management and Insurance Division
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Lech Gałkowski
Member of the Management Board
Business and Corporate Banking Division
Academic background:
Graduate of the SGH Warsaw School of Economics
(Finance and Banking)
Holder of scholarship at Staffordshire University Business
School
Professional background:
1996–1998: Senior Auditor responsible for the banking sector, Coopers & Lybrand sp. z o.o.
1998–2003: Senior Banker responsible for the automotive, consumer and healthcare sectors, ABN AMRO
Bank (Polska) S.A.
2003-2007: CFO and commercial representative, Volvo Auto Polska sp. z o.o.
2008–
2012: Member of the Management Board in charge of Corporate and Investment Banking, RBS Bank
(Polska) S.A. (formerly ABN AMRO Bank (Polska) S.A.)
since 2010: Chairman of the Supervisory Board of Telestrada S.A.
2012-2021: Head of the Corporate and Investment Banking Department (until 2018) and – following an
organisational change –
Head of the Investment Banking Department of Santander Bank Polska S.A.
responsible for development and implementation of a customer relationship strategy
since 2021: Member of the Management Board of Santander Bank Polska S.A. in charge of the Business and
Corporate Banking Division
Patryk Nowakowski
Member of the Management Board
Digital Transformation Division
Academic background:
MSc in Economics from the Poznań University of
Economics (IT and Econometrics)
Professional background:
2004–2007: gained international experience as Business Intelligence Consultant at Business & Decision AG
Zurich, and then as Associate Director in UBS AG and Senior Principal Consultant in Oracle
since 2002 (except the period above): employed with Bank Zachodni WBK S.A., initially as IT Systems
Development Specialist
2008–2016: in charge of the Management Information Team, Information Management
Competence Centre, Systems Development Area and CRM and Business Development Area
2016-2019: Chief Information Officer, including from 2017 to 2018 he managed acquisition of the
demerged part of Deutsche Bank Polska S.A. and completed the legal and operational merger as
well as migration of products held by retail and business customers of the acquired bank to the
systems of Santander Bank Polska S.A.
since 2019: Member of the Management Board of Santander Bank Polska S.A. in charge of the Digital
Transformation Division
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Wojciech Skalski
Member of the Management Board
Financial Accounting and Control Division
Academic background:
Graduate of the Wrocław University of Economics
(Banking and Finance)
Holder of scholarship at the University of Limerick
Completed the executive programme at the ICAN
Institute, Harvard Business Review
Certified chartered auditor and a member of the
Association of Certified Chartered Accountants (ACCA)
Professional background:
Prior to joining Santander Bank Polska S.A., he gained experience with audit firms and consultancies: Ernst
& Young (2002-2003) and Arthur Andersen (1998-2002).
He has worked for Santander Bank Polska S.A. since 2003, first as the accounting policy manager, to be
then promoted, over the next couple of years, to the Head of the Tax and Methodological Support. At the
same time, he was the deputy Head of the Financia
l Accounting Area. Since 2008, he was Head of the
Financial Accounting Area.
Since January 2024, he has been member of the Management Board of Santander Bank Polska S.A. in
charge of the Financial Accounting and Control Division.
Maciej Reluga
Member of the Management Board
Financial Management Division
Academic background:
Graduate of the faculty of Economic Science at Warsaw
University; completed the Finance Management
Programme at the University of Namur (Belgium)
Studied at ICAN Institute’s Strategic Leadership Academy
and completed Senior Management Programme in
Banking at Swiss Finance Institute
Attended a number of programmes and training courses
(including at the University of Cambridge)
Professional background:
1996–1998: Analyst at NBP
1998–2002: Economist at ING Bank Śląski and ING Barings
since 2002: BZ WBK S.A. (Chief Economist)
since 2017: Member of the Management Board of Santander Bank Polska S.A. in charge of the Financial
Management Division
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Dorota Strojkowska
Member of the Management Board
Business Partnership Division
Academic background:
Graduate of Polish and Classical Philology at the Adam
Mickiewicz University in Poznań
Postgraduate of the Poznań University of Economics and
Business and Kozminski University
Completed a number of training courses on HR
management, coaching, strategic planning, financial
management and business psychology, including
Development of Managerial Skills at Nottingham Trent
University and Advanced Leadership Programme at ICAN
Institute, Harvard Business Review
Professional background:
2005–2012: Team Manager in the CRM and Sales Support Department of Bank Zachodni WBK S.A.
2012–2013: Retail Banking Business Model Coherency Director at Bank Zachodni WBK S.A.
2013–2016: Head of the Organisational Effectiveness Area at Bank Zachodni WBK S.A.
from April to December 2016: Head of the HR Division at PKO BP
since 2017: Member of the Management Board of Santander Bank Polska S.A. in charge of the Business
Partnership Division
Magdalena Proga-Stępień
Member of the Management Board
Retail Banking Division
Academic background:
Graduate of the SGH Warsaw School of Economics
(faculties: Finance & Banking and International Economic
& Political Relations)
MBA degree from the Northwestern University in Illinois,
Kellogg School of Management
Professional background:
1999: Analyst at Bank Austria Creditanstalt, Austria
2000: Financial Institutions Auditor at KPMG Sp. z o.o
2001: Business Analyst at Monitor Deloitte, Germany
2001-2011: Partner at McKinsey & Company Sp. z o.o.
2011-2015: Chief Sales & Distribution Officer at Citi Handlowy
2015-2017: CEO of T-Mobile Bank for Poland and Romania (2015-2017)
2017-2020: Chief Strategy & Transformation Officer at Alior Bank
2020-2021: Top Management Advisor at Egon Zehnder Sp. z o.o.
2021-2023: Head of Distribution, Santander Bank Polska S.A.
Since 2023: Vice President of the Management Board of Santander Bank Polska S.A. in charge of the Retail
Banking Division
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Artur Głembocki
Member of the Management Board
Compliance and FCC Division
Academic background:
Graduate of the Wrocław University of Science and
Technology (Management).
Completed a number of
courses in leadership, risk
management, money laundering prevention, and
financial crime compliance.
Professional background:
Since 2008 at Santander Bank Polska S.A. (formerly Bank Zachodni WBK S.A.):
2013-2016: Head of the Corporate Portfolio Risk Management Department
2016-2022: Head of the Risk Management Area
2022-2023: Deputy CRO, Head of the Risk Management Area
Since 2023: Member of the Management Board of Santander Bank Polska S.A. in charge of the Compliance
and FCC Division
5. Management of ESG issues (including ESG risk)
[ESRS 2:
– Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies;
– Disclosure Requirement GOV-2 – Information provided to and sustainability matters addressed by the undertaking’s administrative, management
and supervisory bodies]
Issues related to responsible banking (dubbed “ESG” – Environment, Social, Governance) are discussed by the Management Board, the Supervisory Board
and relevant committees.
The Management Board and the Supervisory Board approved the Bank’s new strategy for 2024–2026, which sets out the directions for the Bank’s ESG
development, i.e. environmental and social initiatives and management actions, by identifying goals related to significant effects, threats and
opportunities. An ESG Strategy will be prepared in 2024 and submitted for the approval of the Management Board and Supervisory Board. The above-
mentioned documents are drawn up by the Bank’s relevant organisational units and committees, in line with their scope of responsibilities. The
Management Board and Supervisory Board receive regular reports on the progress in implementing the strategy, including the ESG strategy.
In addition to the allocation of powers within the Management Board (described in Section IV Governing bodies), the following division of responsible
banking (ESG) tasks and responsibilities has been introduced:
• ESG risk management – Vice President of the Management Board in charge of the Risk Management Division;
• Green finance – Member of the Management Board in charge of the Business and Corporate Banking Division;
• Coordination of the Group’s responsible banking activities, including ESG qualitative reporting – Head of the Corporate Communication and
Marketing Area outside the divisional structure;
• Quantitative reporting on ESG – member of the Management Board in charge of the Financial Accounting and Control Division.
The ESG governance structure includes the following committees:
• The Responsible Banking and Corporate Culture Committee – a management committee holding powers to set the strategy, standards and
manage responsible banking and corporate culture in Santander Bank Polska S.A. The Committee is the main forum to discuss issues
concerning responsible banking, sustainable development, ESG and corporate culture. It sets the direction of strategic activities and monitors
the related objectives across all areas of the Bank.
• ESG Forum – coordinates the development and implementation of solutions related to responsible banking, ESG, corporate culture,
sustainable finance, ESG risks and climate strategy.
When taking decisions, the Management Board considers assessments, information and analyses of the ESG risk management unit. Based on that, it
adopts the Risk Appetite Statement, which is then approved by the Supervisory Board. Specific limits are used to set watch limits and define risk
management policies. The Management Board member in charge of risk management provides the Supervisory Board members with relevant
information about risk to ensure they have a full picture of the Bank’s risk profile and can make informed decisions in this respect.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
In line with its terms of reference, the Supervisory Board oversees the development, implementation and execution of the responsible banking
programme and compliance with regulatory requirements on ESG. In 2023, the Supervisory Board passed resolutions to expand the remit of its
committees, i.e. the Risk Committee and Audit and Compliance Committee. It was agreed that ESG risks would also be addressed when reviewing the
Group’s risk profile, as with the review and recommendation to the Supervisory Board of risk policies comprising the general risk management framework
of the organisation. The Audit and Compliance Committee will review the ESG Report and ESG ratings of the Bank and the Group.
The Bank also has the Responsible Banking and Corporate Culture Committee, which provides support to the Bank’s Management Board in the oversight
of the responsible banking and sustainability strategy both locally and at the level of Santander Bank Polska Group. The Committee, which is chaired by
the President of the Management Board, defines the strategy and annual goals related to ESG and ensures compliance with environmental and social
policies of Santander Bank Polska S.A. The Committee is supported by the ESG Forum composed of senior managers representing all Divisions. The Forum
analyses challenges, opportunities and risks related to the EU Sustainable Finance agenda (including ESG risks), plans activities and coordinates their
implementation at the Bank, and submits regular reports to the Responsible Banking and Corporate Culture Committee and the Bank’s Management
Board.
[ESRS 2 - Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies]
ESG competencies are defined in the terms of reference of the Supervisory Board, organisational units and committees as well as in the Responsible
Banking Model that describes key accountabilities, processes, roles and key responsibilities, and the approach to responsible banking.
[ESRS 2:
–Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies;
– Disclosure Requirement GOV-2 – Information provided to and sustainability matters addressed by the undertaking’s administrative, management
and supervisory bodies]
According to the internal allocation of powers referred to above, responsibility for the management of risk related to responsible banking rests with the
Risk Management Division. In 2023, the ESG risk management model was reinforced. ESG risks were integrated with the divisional strategy (by defining
risk transmission channels to traditional banking risks) and reflected in the terms of reference of the Division (roles and responsibilities).In order to ensure
an adequate organisation of the ESG management function, the ESG Risk Management Office was set up in the Risk Management Division. The Office is
responsible for integrating ESG risks with internal risk management framework, including risk reporting, credit risk assessment and monitoring, reflecting
climate risk in collateral valuation, and setting internal exposure and concentration limits.
Oversight of risk management is exercised through reports submitted by relevant persons and units at meetings of the Management Board committees
(Responsible Banking and Sustainable and Culture Board Committee, Risk Control Committee), the Management Board, the Risk Committee of the
Supervisory Board, and the Supervisory Board.
Day-to-day work of individual employees and teams is supervised through reporting lines – by line managers and Management Board members in charge
of specific issues.
In 2023, the Management Board, Supervisory Board and relevant committees took into consideration significant effects, threats and opportunities arising
from climate, physical and transition risks ESG-wise.
Appropriate identification of risks and opportunities related to climate transition allows Santander Bank Polska Group to take measures to increase
resilience to negative climate factors and to leverage positive factors to accelerate growth, improve financial results and build reputation of the Bank and
the Group.
The sources of physical risks are among other things extreme weather conditions such as severe storms or floods which may cause infrastructure
disruption or damage in many sectors. Due to the nature of its activities, the agri sector is particularly exposed to physical risks, with an increased risk of
soil erosion affecting crop quality and yields.
In a medium and long term, there is a physical risk related to deteriorating hydrological conditions in Poland and the risk of drought. Water scarcity and
the lack of relevant retention systems may adversely affect the economy, including the energy sector. For example, the CHP plants that use river water
for cooling purposes may be forced to limit energy production during drought. Fire risk is also identified in the soft commodities sector, e.g. risk of
potential losses caused by fire in wood production.
The most sensitive sectors in the context of transition to a low-carbon economy are the sectors based on coal and other fossil fuels that dominate the
Polish energy mix. There are regulatory and legal risks connected with higher costs of CO2 emissions, more stringent data reporting and gathering
requirements as well as regulatory changes that may limit the operations of some high-carbon businesses.
The Bank includes ESG issues in some of its lending processes. Work is under way to collect data to adequately reflect climate risks in the value of
collateral, in line with the KNF’s guidelines issued in March 2023. There is a project in place to collect data about climate risks and, more broadly, ESG
data in a systemic way.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The Bank is aware that climate changes and transformation of the economy bring both risks and new business opportunities. The transition to a green
economy allows Santander Bank Polska Group to help existing and future customers as well as to support economic transformation by providing relevant
financing solutions.
6. Remuneration policy
Remuneration of Management and Supervisory Board members
Remuneration of Supervisory Board members
Internal regulations concerning remuneration for supervisory function holders
As at 31 December 2023, the remuneration for Supervisory Board members was set in accordance with the Remuneration Policy for
Members of the Supervisory Board of Santander Bank Polska S.A., which was adopted by virtue of Resolution no. 31 of the Annual General
Meeting of 27 April 2022. The foregoing policy complies with EU regulations, Polish laws and corporate governance principles for
supervised entities.
Remuneration principles
The remuneration of members of the Supervisory Board of Santander Bank Polska S.A. is set by the Bank’s General Meeting, depending on
their function performed on the Supervisory Board, membership of the Supervisory Board Committees and the related additional tasks
performed. The General Meeting may authorise the Supervisory Board to determine additional remuneration for the Supervisory Board
members entrusted with ongoing individual oversight. The remuneration for Supervisory Board members is paid in cash only.
No additional discretionary pension benefits or early retirement programmes are envisaged for Supervisory Board members.
Amount of remuneration
The amount of remuneration of the Supervisory Board members is specified in Resolution no. 5 of the Annual General Meeting of 20
July 2023, which repealed Resolution no. 50 of the Annual General Meeting of 22 June 2020 (amended by Resolution no. 30 of the
Annual General Meeting of 22 March 2021). Members of the Supervisory Board are paid monthly remuneration for performing their
role on the Supervisory Board and additional remuneration for participating in each of the meetings of the Supervisory Board Committees on which they
sit. Three members of the Supervisory Board related to Santander Group did not receive remuneration, namely: José García Cantera, Isabel Guerreiro and
José Luís de Mora.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The table below presents the remuneration paid to members of the Supervisory Board of Santander Bank Polska S.A. in 2022 and 2023.
2023 2022
Name and surname
Role in the Supervisory
Board
Period
Amount
(PLN k)
Period
Amount
(PLN k)
Antonio Escámez Torres Chairman 01.01.2023-31.12.2023 328 01.01.2022-31.12.2022 338
José Luis de Mora
1)
Deputy Chairman 01.01.2023-31.12.2023 - 01.01.2022-31.12.2022 -
Dominika Bettman Member 01.01.2023-31.12.2023 334 01.01.2022-31.12.2022 296
José Garcīa Cantera
1)
Member 01.01.2023-31.12.2023 - 01.01.2022-31.12.2022 -
Danuta Dąbrowska Member 01.01.2023-31.12.2023 288 01.01.2022-31.12.2022 258
Isabel Guerreiro
1)
Member 01.01.2023-31.12.2023 - 01.01.2022-31.12.2022 -
David Hexter Member 01.01.2023-31.12.2023 270 01.01.2022-31.12.2022 358
John Power
2)
Member 01.01.2023-01.08.2023 217 01.01.2022-31.12.2022 288
Jerzy Surma Member 01.01.2023-31.12.2023 342 01.01.2022-31.12.2022 298
Marynika Woroszylska-Sapieha Member 01.01.2023-31.12.2023 307 01.01.2022-31.12.2022 253
Adam Celiński
3)
Member 01.08.2023-31.12.2023 102 n/a n/a
John Power additionally received PLN 32k in 2023 (PLN 98k in 2022) for his membership of the Supervisory Boards of the Bank’s subsidiaries and Adam
Celiński received PLN 28k for 2023.
Remuneration of Management Board members
Internal regulations concerning remuneration for executives
The rules regarding fixed and variable components of remuneration for Management Board members are set out in the Remuneration
Policy for Members of the Management Board of Santander Bank Polska S.A. introduced by virtue of Supervisory Board Resolution no. 31
of 27 April 2022 and in the Remuneration Policy of Santander Bank Polska Group updated on 23 September 2023.
Remuneration principles that apply to Management Board members are determined by the Supervisory Board on the basis of recommendations from the
Remuneration Committee, except for remuneration paid under Incentive Plan VII, whose terms were determined by the General Meeting of Shareholders
(Resolution no. 30 of the Annual General Meeting of 27 April 2022 on Incentive Plan VII and conditions of its execution, as amended).
Agreements between Santander Bank Polska S.A. and its executives
The Management Board members signed employment contracts with Santander Bank Polska S.A. for the current term of office. The
contractual terms and conditions comply with general laws and internal regulations, in particular with the Remuneration Policy for
Members of the Management Board of Santander Bank Polska S.A. The Management Board members also signed agreements prohibiting
competitive activity after termination of their employment with Santander Bank Polska S.A.
A Management Board member who is not appointed for a new term of office or is removed from the Board is entitled to one-off severance pay. It does
not apply to Management Board members who accept a new role in the bank, are removed due to gross violation of their obligations or standards of
integrity, culture and professional conduct, resign or are not granted discharge.
Santander Bank Polska S.A. does not have an obligation to pay pension or other similar benefits to former members of the Management Board or the
Supervisory Board.
1) José García Cantera, José Luis de Mora and Isabel Guerreiro did not receive remuneration for their membership of the Supervisory Board.
2) Member of the Supervisory Board until 1 August 2023
3) Member of the Supervisory Board since 1 August 2023
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Fixed remuneration
Pursuant to the Statutes of Santander Bank Polska S.A. and the aforementioned regulations, the remuneration of the President and
members of the Management Board is set by the Supervisory Board, taking into account recommendations of the Remuneration
Committee. The Committee defines the remuneration policy for Management Board members and individual terms and conditions as
part of remuneration packages for each Management Board member.
Fixed remuneration includes base salary, additional benefits specified in the internal awarding regulations (e.g. health insurance) as well as severance
pay and compensation arising from external regulations.
When determining the amount of the base salary of a Management Board member, the following criteria are specifically taken into account: function
performed, scope of responsibilities as well as the need to ensure the adequacy of remuneration received by individual members of the Management
Board given their duties and responsibilities, qualifications and professional experience and market competitiveness of the remuneration offered. No
additional discretionary pension benefits or early retirement programmes are envisaged for Management Board members.
The table below presents the total remuneration and additional benefits received by members of the Management Board of Santander Bank Polska S.A.
in 2023 and 2022 for their membership of the Management Board.
2023 2022
Name and surname
Role in the
Management
Board
Period
Remuner
a-tion
(PLN k)
Additional
benefits
2)
(PLN k)
Period
Remunera
-tion
(PLN k)
Additional
benefits
2)
(PLN k)
Michał Gajewski President
01.01.2023-
31.12.2023
3 150 325
01.01.2022-
31.12.2022
3 150 214
Andrzej Burliga Vice President
01.01.2023-
31.12.2023
1 368 272
01.01.2022-
31.12.2022
1 344 160
Juan de Porras Aguirre
Vice President
01.01.2023-
31.12.2023
1 612 756
01.01.2022-
31.12.2022
1 582 570
Arkadiusz Przybył
Vice President
01.01.2023-
31.12.2023
1 536 256
01.01.2022-
31.12.2022
1 536 125
Lech Gałkowski Member
01.01.2023-
31.12.2023
1 398 218
01.01.2022-
31.12.2022
1 320 145
Patryk Nowakowski
Member
01.01.2023-
31.12.2023
1 416 179
01.01.2022-
31.12.2022
1 392 115
María Elena Lanciego
Pérez
1)
Member
01.01.2023-
31.12.2023
1 139 381 n/a n/a n/a
Maciej Reluga
Member
01.01.2023-
31.12.2023
1 248 214
01.01.2022-
31.12.2022
1 176 149
Dorota Strojkowska
Member
01.01.2023-
31.12.2023
1 326 234
01.01.2022-
31.12.2022
1 260 125
Magdalena Proga-
Stępień
1)
Member
04.04.2023-
31.12.2023
854 114 n/a n/a n/a
Artur Głembocki
1)
Member
14.11.2023-
31.12.2023
171 6 n/a n/a n/a
1) Changes to the composition of the Management Board in 2023 are presented above in Section “Management Board”.
2) Additional benefits received by Management Board members include, among other things, life insurance cover without pension option and, in the case of
Juan de Porras Aguirre and Elena Lanciego Pérez also medical cover, accommodation and travel expenses.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
No Management Board member received remuneration for their membership in the governing bodies of the subsidiaries or associates in any of the
analysed periods.
Variable remuneration
The general rules for determining variable remuneration for Management Board members of Santander Bank Polska S.A. are laid
down in the Remuneration Policy of Santander Bank Polska Group, and defined in more detail in the Remuneration Policy for Members of
the Management Board of Santander Bank Polska Group.
The annual bonus of a Management Board member depends on the annual base bonus, the availability of the bonus pool and the overall
evaluation of the Management Board member’s performance.
Variable remuneration is awarded to Management Board members based on the evaluation of their performance. The selection of metrics (as well as
their granularity) for individual Management Board members takes into account their individual duties and responsibilities in the process of managing
the Bank.
Based on the metrics and evaluation of performance against the objectives under WHAT, HOW and RISK categories as well as relevant weights assigned
to them, the rating is established and adjusted by a multiplier, which arises, among other things, from the assessment of performance against a three-
year horizon, as proposed by the Supervisory Board Remuneration Committee and approved by the Supervisory Board.
The base bonus is set on the basis of an individual scope of responsibility, taking into account market conditions and other criteria. Each year, the
Remuneration Committee reviews the performance of each Management Board member in line with a separate policy and a detailed procedure for
evaluating the performance of Management Board members. The final decision on the amount of the annual bonus for Management Board members is
taken by the based on the Remuneration Committee’s recommendation.
The level of the annual bonus is determined on the basis of global quantitative, qualitative and risk indicators as well as potential adjustments in respect
of unexpected events. The indicators are set in accordance with the Bank’s financial plan and strategic goals and take into account risk management
requirements. The Bank’s performance used to define variable components of remuneration considers the cost of credit, the cost of capital, and liquidity
risk in a long-term perspective.
The total variable remuneration paid to Management Board members and material risk takers for a given calendar year cannot exceed 100% of the total
fixed remuneration paid for that year. However, in exceptional cases, this limit may be increased up to 200% of fixed remuneration subject to the approval
of the Bank’s General Meeting.
Variable remuneration is awarded in accordance with bonus regulations and paid in cash or financial instruments (shares or related instruments such as
phantom stock). The remuneration paid in financial instruments may not be lower than 50% of the total amount of variable remuneration. Payment of
min. 40% of variable remuneration (min. 60% in the case of variable remuneration exceeding an equivalent of EUR 1m) is conditional and deferred for
the period of at least four years (five years in the case of Management Board members and senior executives). It is paid in equal annual instalments in
arrears during the deferral period, unless there are reasons for reduction or non-payment.
The Management Board members may also receive variable remuneration provided for in the long-term incentive plans designed to reinforce the
connection between the long-term financial effectiveness of the Bank, expectations of shareholders and awards for executives while adhering to market
standards. Subject to certain criteria, the plans enable their participants to take up a certain number of the Bank's shares.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The table below presents variable remuneration paid to Management Board members in 2023 and 2022.
Name and surname
Role in the
Management Board
2023 2022
Period
Variable
remuneration
paid
2)
(PLN k)
Period
Variable
remuneration
paid
3)
(PLN k)
Michał Gajewski President 01.01.2023-31.12.2023 2 749 01.01.2022-31.12.2022 2 721
Andrzej Burliga Vice President 01.01.2023-31.12.2023 971 01.01.2022-31.12.2022 924
Juan de Porras Aguirre Vice President 01.01.2023-31.12.2023 1 604 01.01.2022-31.12.2022 1 745
Arkadiusz Przybył Vice President 01.01.2023-31.12.2023 1 239 01.01.2022-31.12.2022 1 241
Lech Gałkowski Member 01.01.2023-31.12.2023 810 01.01.2022-31.12.2022 344
Patryk Nowakowski
1)
Member 01.01.2023-31.12.2023 893 01.01.2022-31.12.2022 709
María Elena Lanciego
Pérez
1)
Member
01.01.2023-31.12.2023 - n/a n/a
Maciej Reluga Member 01.01.2023-31.12.2023 936 01.01.2022-31.12.2022 896
Dorota Strojkowska Member 01.01.2023-31.12.2023 968 01.01.2022-31.12.2022 926
Magdalena Proga-Stępień
1)
Member 04.04.2023-31.12.2023 - n/a n/a
Artur Głembocki1) Member 14.11.2023-31.12.2023 - n/a n/a
Pursuant to the remuneration system applicable at the Bank, Management Board members may be conditionally entitled to a bonus for 2022 which
would be paid in part in 2023 and thereafter, if specific criteria are met. As at the date of these financial statements, the Supervisory Board did not take
a decision in this respect.
Incentive Plan VII
In 2022, Santander Bank Polska S.A. introduced Incentive Plan VII under Resolution no. 30 of the Annual General Meeting (“Plan”). The Plan is addressed
to the employees of the Bank and its subsidiaries who significantly contribute to growth in the value of the organisation. The purpose of the Plan is to
motivate the participants to achieve business and qualitative goals in line with the Group’s long-term strategy and to provide an instrument that
strengthens the employees’ relationship with the organisation and encourages them to act in its long-term interest.
The plan obligatorily covers all persons with an identified employee status in Santander Bank Polska Group (key function holders at the Bank appointed
in accordance with Article 22aa(10) of the Polish Banking Act). The list of other key participants is determined by the Management Board and approved
by the Bank’s Supervisory Board. Those employees can participate in the Plan on a voluntary basis.
The participants who satisfy the conditions stipulated in the Participation Agreement and the Resolution will be entitled to an award which is variable
remuneration in the form of the Bank’s shares classified as an equity-settled share-based payment under IFRS 2. To that end, the Bank will buy back up
to 2,331,000 shares from 1 January 2023 until 31 December 2033.
The Bank’s Management Board will buy back the shares to execute Incentive Plan VII based on the authorisation granted by the General Meeting in a
separate resolution. If it is not possible to buy back the shares (e.g. due to illiquidity of the shares on the Warsaw Stock Exchange, share prices going
beyond the thresholds defined by the General Meeting, lack of the General Meeting’s authorisation for the Management Board to buy back shares in a
given year of Incentive Plan VII or lack of the General Meeting’s decision to create a capital reserve for share buyback in a given year) in the number
corresponding to the value of the awards granted, the Bank will reduce pro-rata the number of shares granted to the participant. The difference between
1)
Changes to the composition of the Management Board in 2023 are presented above in Section “Management Board”.
2)
Variable remuneration paid in 2023 includes part of the award for 2018–2021 which was conditional and deferred in time, and non-deferred part of the award paid
in 2022.
3)
Variable remuneration paid in 2022 includes part of the award for 2017–2020 which was conditional and deferred in time, and non-deferred part of the award paid
in 2021.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
the value of the awards granted and the value of the shares transferred by the Bank to the participants as part of the award will be paid out as a cash
equivalent.
Below are the vesting conditions that must be met jointly in a given year:
1) Delivery of at least 50% of the profit after tax (PAT) target of SAN PL for a given year.
2) Delivery of at least 80% of the team business targets for a given year at the level of SAN PL, Division or unit;
the performance against the target is calculated as the weighted average of performance against at least three business targets defined as
part of the financial plan approved by the Supervisory Board for a given year for SAN PL, Division or unit where the participant works, in
particular:
a. PAT (profit after tax) of SAN PL Group (excluding Santander Consumer Bank);
b. ROTE (return on tangible equity expressed as a percentage calculated in line with SAN PL reporting methodology);
c. NPS (Net Promoter Score calculated in line with SAN PL reporting methodology);
d. RORWA (return on risk weighted assets calculated in line with SAN PL reporting methodology);
e. number of customers;
f. number of digital customers.
3) The participant’s performance rating for a given year at the level not lower than 1.5 on the 1–4 rating scale.
In addition, at the request of the Bank’s Management Board, the Supervisory Board can decide to grant a retention award to a participant, if the following
criteria are met:
1) the participant’s average annual individual performance rating is at least 2.0 on the 1–4 rating scale during the period of their participation in
Incentive Plan VII;
2) the average annual weighted performance against the Bank’s targets in the years 2022–2026 is at least 80%, taking into account the following
weights:
a. 40% for the average annual performance against the PAT target;
b. 40% for the average annual performance against the RORWA target;
c. 20% for the average annual performance against the ESG target.
The maximum number of own shares to be transferred to participants as the retention awards is 451,000.
For the purpose of the Plan, in 2023 Santander Bank Polska S.A. bought back 165,406 shares (of 207,000 shares eligible for buyback) with the value of
PLN 48,884,192 (from PLN 55,300,000 worth of capital reserve allocated to the delivery of the Plan for 2022).
The average buyback price per share in 2023 was PLN 294.48.
The Plan covers the period of five years (2022–2026). However, as the payment of variable remuneration is deferred, the share buyback and allocation
will be completed by 2033.
All the above shares were transferred to individual brokerage accounts of the participants. As the number of shares bought back by the Bank was sufficient
to pay an award to the participants of Incentive Plan VII for 2022, on 16 March 2023 the Bank’s Management Board adopted a resolution to end the
buyback in 2023.
Bank’s shares held by Supervisory and Management Board members
As at the release dates of the financial reports for the periods ended 31 December 2023, 30 September 2023 and 31 December 2022, no member of the
Supervisory Board held any shares of Santander Bank Polska S.A.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The table below shows shares of Santander Bank Polska S.A. held by Management Board members as at the release dates of the above-mentioned
reports.
16.02.2024
25.10.2023
22.02.2023
Management Board members
as at the end of the reporting
period and the release date of
the annual report
Shares held
Shares awarded
as part of the
Incentive Plan
1)
Shares held
Shares awarded as
part of the Incentive
Plan
1)
Shares held
Michał Gajewski 4 795 9 519
4 795
9 519
4 795
Andrzej Burliga
2)
884
2 539
1 884
2 539
1 884
Lech Gałkowski
2)
-
2 956
-
2 956
951
Artur Głembocki
4)
- - - -
Patryk Nowakowski
2)
-
2 484
- 2 484
-
Juan de Porras Aguirre
2)
1 279
3 627
3 379
3 627
3 379
Magdalena Proga-Stępień
3)
-
-
n/a
n/a
n/a.
Arkadiusz Przybył - 2 956
-
2 956
2 999
Maciej Reluga 2 301 2 484
2 301
2 484
2 301
Wojciech Skalski
4)
3 124
-
n/a
n/a
n/a.
Dorota Strojkowska
2 732
2 484
2 732
2 484
2 732
Total
15 115
29 049
15 091
29 049
19 041
1) Shares awarded to members of the Management Board of Santander Bank Polska S.A. as part of Incentive Plan VII, which are deferred and will be transferred to
individual brokerage accounts in 2024-2029.
2) Lech Gałkowski, Arkadiusz Przybył, Juan de Porras Aquirre and Andrzej Burliga sold shares of Santander Bank Polska S.A. on 26 October 2023, 6 March 2023, 9
March 2023 and 1 December 2023, respectively.
3) Magdalena Proga-Stępień took up her role as a member of the Management Board of Santander Bank Polska S.A. as of 4 April 2023.
4) Artur Głembocki took up his role as a Management Board member on 14 November 2023 and Wojciech Skalski on 1 January 2024.
Relationship between the remuneration paid to Management Board members and key
managers and long-term business and financial objectives of the company
[ESRS 2, Disclosure Requirement GOV-3 – Integration of sustainability-related performance in incentive schemes 27-29]
The remuneration policy of Santander Bank Polska S.A., which regulates variable components of remuneration paid to material risk takers (identified
employees), has an overall objective to incentivise employees to meet short-, medium- and long-term objectives of the Group, exceed plans, and achieve
progress in individual performance.
The criteria that affect the type and amount of fixed and variable remuneration paid to Management Board members were defined so as to support the
delivery of the Bank’s business strategy, long-term interests and stability, in particular by:
setting annual objectives in accordance with the Bank’s financial and strategic plans, and assessing the performance of individual Management
Board members;
applying a flexible remuneration policy by maintaining a proper balance between fixed and variable components;
awarding part of remuneration in the form of financial instruments and deferring payment of variable remuneration for a minimum of five
years ensuring that the Bank’s financial performance has influence on remuneration in the long-term perspective;
applying malus clauses, which ensures proper and effective risk management and discourages excessive taking of risk which might materialise
in the deferral period;
awarding the variable components of remuneration only if it does not represent any threat to the solid capital base of the Bank or the Group
in the long-term horizon;
a possibility to set up incentive plans to support delivery of the Bank’s strategy in the long-term perspective.
Variable remuneration of identified persons (including Management Board members) depends on the assessment of their individual performance and
on the results of their organisational unit, area under management and the Bank. The individual performance is assessed in accordance with the standard
procedure, based on financial and non-financial criteria.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The performance review covers the period of minimum three years and takes into account the Bank’s economic cycle and business risk. At least 50% of
variable remuneration is paid in the form of phantom stock based on the Bank’s shares. In addition, payment of min. 40% of variable remuneration is
deferred for the period of at least four years (five years in the case of Management Board members and senior executives). It is paid in equal annual
instalments in arrears during the deferral period, unless there are reasons for reduction or non-payment.
Santander Bank Polska Group has a formal process in place for identification, assessment and ex-post review of performance resulting in the adjustment
of the variable remuneration for identified employees (material risk takers) and other employees subject to those regulations.
The variable components of remuneration for the identified employees responsible for risk management, compliance with the law, internal regulations,
and market and internal audit standards are reviewed and monitored by the Remuneration Committee of the Supervisory Board. Variable remuneration
of the heads of the compliance and internal audit areas is approved by the Supervisory Board.
The Management Board members and key employees may receive awards under long-term incentive plans established to retain the above-mentioned
staff and improve the efficiency and value of the organisation. The plans set out in detail the criteria that must be met by Management Board members
and other participants for an award to be granted, and the right of the Bank’s Supervisory Board to change the terms and conditions of the incentive plan,
e.g. in the event of any substantial deterioration of the financial standing or risk profile.
The Bank ensures also consistency of the Remuneration Policy with the Bank’s strategy for integrating risks related to sustainable development by linking
it to variable remuneration of the employees responsible for developing investment recommendations as part of investment advisory services. In
addition, fixed and variable remuneration should be aligned with the Group’s ESG objectives/ limits by linking variable remuneration of the Group’s key
function holders to the achievement of such objectives, preventing excessive risk-taking in this area and misinformation about the Group’s ESG-related
measures (“green-washing” practices).
Moreover, ESG (environment, social responsibility and governance) is one of the factors included in qualitative factors applied to calculate the bonus pool
for top executives and key employees and its weight ranges from -5% to +5%.
7. Other transactions with executives
Loans and advances
Loans and advances granted by Santander Bank Polska S.A. to the Bank’s executives and their relatives totalled PLN 3,667k as at 31
December 2023 vs PLN 4,799k as at 31 December 2022. These facilities were sanctioned on regular terms.
Deposits placed with Santander Bank Polska S.A. by the Bank’s executives and their relatives totalled PLN 7,701k as at 31 December 2023
(PLN 10,197k as at 31 December 2022).
8. Diversity Policy
Foundations of the diversity management approach
Santander Bank Polska S.A. complies with the laws on diversity, inclusion and equal opportunities. It is committed to promoting diversity in accordance
with best practice and ensuring equal treatment of employees and other stakeholders regardless of their gender, age, education, health conditions, race,
religion, national or ethnic origin, political beliefs, trade union membership, family status or sexual orientation.
Aspects such as respect for individuality, promotion of equal treatment and prevention of discrimination are addressed by a number of policies and
procedures applicable at the Bank, including the Responsible Banking and Sustainability Policy, the Santander Bank Polska Management Board Diversity
Policy, the Respect and Dignity Policy and the Corporate Culture Policy of Santander Bank Polska Group.
Furthermore, as a signatory to the Diversity Charter (the international initiative supported by the European Commission), Santander Bank Polska S.A.
committed itself to respecting and supporting diversity. The Bank is also a member of the Responsible Business Forum and the Polish ESG Association.
Respect for individualism, equal treatment and prevention of discrimination are the cornerstones of the Bank’s corporate culture.
The diversity and inclusion culture is supported at the Bank by such initiatives as: Diversity Ambassadors (role performed by senior executives), employee
networks (bottom-up initiatives focused on promotion of diversity), educational campaigns, training, webinars (e.g. the Diversity Month). The Bank’s
activities in this area are supported by strategic partnerships with expert organisations: Share the Care, UN Global Compact Network Poland, Vital Voices,
Responsible Business Forum.
In addition, the Bank was included in the list of the most advanced employers in Poland in terms of diversity and inclusion. The list was based on the
Diversity IN Check survey, which checks the maturity of organisations in managing diversity and building an inclusive work environment. The survey is
conducted by the Responsible Business Forum, which coordinates the Diversity Charter in Poland. The Bank’s activities were also recognised with many
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
awards, such as the “Top Employer 2023” title, the “Great Place to Work!” certificate, Polityka’s “CSR Golden Leaf” for 2023, the “Ethical Company” title
awarded by Puls Biznesu and the “Equal Company” title from the Forbes Woman magazine.
Diversity policy regarding the governing bodies
[ESRS 2 – Disclosure Requirement GOV-1 – The role of the administrative, management and supervisory bodies]
The Bank pursues its diversity strategy as part of selection, assessment of suitability and succession of members of supervisory and management bodies.
The above processes are delivered in a way that prevents discrimination on any grounds, particularly based on gender, race, colour, ethnic or social origin,
genetic features, religion or beliefs, membership of a national minority, property, birth, disability, age or sexual orientation.
The Bank’s internal regulations in this respect are based on the Joint ESMA and EBA Guidelines EBA/GL/2021/06 and comply with the applicable laws,
including the Banking Law Act and the Commercial Companies Code.
The Bank strives to ensure that members of the Management and Supervisory Boards have a wide range of competencies, professional skills, adequate
professional experience, capabilities and impeccable reputation, while ensuring diversity in terms of age, academic and professional background and
geographical origin. The Bank’s ambition is also to have an adequate representation of women and men on these boards.
The Management Board Diversity Policy of Santander Bank Polska S.A. promotes diversity among Management Board members in terms of their qualities
and skills to ensure different perspectives and extensive experience, prevents exclusion (promotes inclusion) and supports independent judgment and
informed decision making based on a wide range of criteria.
Pursuant to the above policy, the Supervisory Board strives to achieve minimum 30% representation of women on the Management Board by 2025 and
increase diversity in terms of age and geographical provenance.
Furthermore, the Nomination and Succession Policy for Management Board Members and Key Function Holders of Santander Bank Polska S.A. is to
ensure the continuity of business processes delivered by senior managers, while maintaining the best possible balance of the management team in terms
of gender, knowledge, skills and experience.
The diversity of the Supervisory Board is governed by the Policy on the Suitability Assessment of Supervisory Board Members in Santander Bank Polska
S.A. and the Nomination and Succession Planning Policy for Supervisory Board Members in Santander Bank Polska S.A., which require that – apart from
having adequate education, professional experience and good repute – the candidates for the Supervisory Board and the Management Board positions
should possess a wide spectrum of qualities and skills and independence of mind. Moreover, the former policy sets out an objective of 40%–60% female
representation on the Supervisory Board by 2025.
To ensure the above representation of women and men on the Management and Supervisory Boards, the Nominations Committee of the Supervisory
Board takes into account all personnel of Santander Group and business objectives related to cross-border activities. Further to this, it takes measures to
ensure that the succession plans include an appropriate percentage of women to achieve the set objective and that the women considered in such plans
are ready to take up their role within the prescribed time frame.
As at 31 December 2023, there were four women on the Bank’s Supervisory Board: Danuta Dąbrowska, Dominika Bettman, Isabel Guerreiro and Marynika
Woroszylska-Sapieha (40% representation). On the Management Board, women were represented by Dorota Strojkowska in charge of the Business
Partnership Division, Magdalena Proga-Stępień in charge of the Retail Banking Division, and María Elena Lanciego Pérez in charge of the Financial
Accounting and Control Division (27% representation vs a 11% representation as at 31 December 2022). In total, women accounted for 33% of the
supervisory and management bodies.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The Supervisory and Management Boards ensures diversity in terms of gender, age, experience and academic background. The tables and graphs below
show diversity of the above-mentioned bodies:
Independent members Number (percentage)
Supervisory Board
5 (50%)
Executive and non-executive members
Number
Management Board members (executives) 11
Supervisory Board members (non-executives) 10
Gender
Women
1)
Men
Supervisory Board 4 6
Management Board 3 8
* as a result of the resignation of María Elena Lanciego Pérez and appointment of Wojciech Skalski as her replacement effective as of 1 January 2024, there are two women and 9 men on the Management
Board
Age 31–40 41–50 51–60 above 60
Supervisory Board
-
-
6 4
Management Board 1
5 5 -
Years of service with Santander Bank Polska S.A.
1)
up to 5 6–10 11–15 16–20 21–25
Supervisory Board
4 4 2 -
-
Management Board 5 4 1 1
-
2) Counted from their first appointment to the Supervisory Board or Management Board.
International experience Number
Supervisory Board
7
Management Board 5
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Women
33%
Men
67%
Gender of supervising and executive staff
of Santander Bank Polska S.A.
30-40 yrs
5%
41-50 yrs
24%
51-60 yrs
52%
over 60 yrs
19%
Age of supervising and executive staff
of Santander Bank Polska S.A.
up to 5 yrs
43%
6-10 yrs
38%
11-15 yrs
14%
16-20 yrs
5%
Work experience of supervising and executive staff with
Santander Bank Polska S.A.
9. Internal control and risk management systems for financial reporting
Objective of the internal control system
Santander Bank Polska Group has an internal control system in place, which – together with the risk management system – is a fundamental
element of the Group’s management system.
The internal control system supports decision-making processes, contributes to an increase in operational efficiency of the organisation, and ensures
adherence to risk management principles, laws, internal regulations and standards, regulatory requirements and best market practice. The effective
system allows the Bank to ensure the reliability of financial reporting and its compliance with laws, international standards, internal regulations and
supervisory recommendations.
Organisation and operation of the internal control system
The Bank’s Management Board is responsible for developing and implementing an effective internal control system in all organisational
units, and for updating internal regulations and establishing adequacy and effectiveness criteria for evaluating that system. Its role is also
to ensure the continuity of the system and to verify control mechanisms and procedures as well as to define and take relevant measures to
remove any deficiencies after they are identified.
The Supervisory Board monitors the effectiveness of the internal control system and carries out an annual assessment of the adequacy and effectiveness
of the control function based on the information obtained from the compliance unit, internal audit unit, the Bank’s Management Board and the Audit and
Compliance Committee.
The internal control and risk management systems of Santander Bank Polska Group are based on three lines of defence.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Three lines of defence in the internal control and risk management systems
In line with the Bank’s Internal Control System Policy of Santander Bank Polska S.A., at all three lines of defence, the Bank's employees apply controls or
independently monitor compliance with controls while performing their professional duties.
The assessment of the design and effectiveness of the internal control system covers all available information and related audit and regulatory
recommendations. Results of assessments and tests form the basis for the Bank’s management to make representations on the effectiveness of the
control environment.
The internal control system of Santander Bank Polska Group was developed on the basis of the requirements defined in the Regulation of the Minister of
Finance, Funds and Regional Policy on the risk management system, internal control system and remuneration policy in banks, and the KNF’s
Recommendation H on the internal control system in banks.
Furthermore, the internal control system meets specific requirements arising from such regulations as:
the Sarbanes-Oxley Act (SOX);
the Volcker Rule (section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act);
RDA/RRF (Basel Committee on Banking Supervision 239: Principles for effective risk data aggregation and risk reporting);
FATCA (Foreign Account Tax Compliance Act);
GDPR;
EMIR;
MiFID 2.
Although these financial statements focus on control mechanisms used in financial reporting processes, the internal control system covers all significant
areas of the Bank’s operations.
In the light of the Sarbanes-Oxley Act, Santander Bank Polska Group operates as a material and independent organisation within the structure of
Santander Group and as such is required to implement, maintain and assess the effectiveness of the internal control environment pursuant to the above-
mentioned act. Accordingly, the Bank’s management carries out an annual certification process to confirm that the control mechanisms in place
effectively mitigate the risk of any failure to identify any material error in the financial statements.
The certification process for compliance with the Sarbanes-Oxley Act in 2023 covered all key business areas of Santander Bank Polska S.A. and was
carried out using the solutions and methodology based on Santander Group’s approach. As part of the SOX certification process for 2023, the Bank’s
The first line of defence is focused on
the management of risks in the Bank’s
operational activity and involves
business units which, as part of their
day-to-day activities, generate risks
that affect achievement of the Bank’s
objectives.
The first line includes activities
performed by each employee to ensure
the quality and correctness of the
completed tasks.
The first line of defence checks the
compliance with procedures and
responds to any identified
irregularities.
The rules of independent monitoring as
part of this line of defence are
established by the Management Board
member in charge of a Division or a
Bank/Area Director or the President of
the Management Board of a subsidiary
in the form of relevant internal
regulations, taking into account the
segregation of duties.
First line of defence
The second line of defence involves risk
management by employees in
dedicated roles or organisational units
and the operations of the compliance
function.
Risk management as part of the second
line of defence is independent of risk
management in the first line of
defence.
The second line of defence comprises
functions which support the Bank’s
managers in identification and
management of risks. To that end, the
second line of defence provides
relevant tools and develops internal
regulations and techniques for
managing, monitoring, verifying,
testing and reporting risks.
The units of the second line of defence
conduct independent vertical
monitoring in order to verify whether
the first line of defence takes effective
measures and applies the required
control mechanisms.
Second line of defence
The third line of defence is formed by
the Internal Audit function, which
provides independent and objective
examination and assurance of the
control mechanisms applied as part of
the first and second lines of defence as
well as assesses the management
system of the Bank and its subsidiaries,
including the effectiveness of
managing the risk related to their
operations.
Third line of defence
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
management confirmed that no incidents had been identified in Santander Bank Polska Group which could significantly affect the relevant processes or
threaten the effectiveness of the internal control over financial reporting.
Control mechanisms related to financial reporting
One of the key objectives of the internal control system is to ensure full accuracy and reliability of financial reporting.
To manage the risk associated with the preparation of financial statements, the Bank monitors legal and regulatory changes to the
reporting obligations of banks. It updates its accounting policies and the scope and form of disclosures in financial statements on an ongoing basis. The
Bank also controls its consolidated entities through its representatives sitting on the supervisory boards of individual subsidiaries.
Data inputs in the source systems are subject to formal operational and approval procedures, which state the responsibilities of individual staff members.
Data processing for the purpose of financial reporting is subject to relevant control mechanisms, such as procedures for securing data or specialist internal
controls whose objective is to monitor and test the correctness and accuracy of data. All manual adjustments, including management overrides, are under
strict control, which covers all IT systems used to prepare financial reports. The systems meet the integrity and cybersecurity requirements for IT
architecture. Their business continuity plans are updated on an ongoing basis.
The quality of financial input data is ensured by the Information Control Department. The Financial Control Department controls the consistency and
completeness of the Bank’s books, while the Reporting Department prepares the Bank’s and Group’s financial statements and monitors the financial
statements of the Bank’s subsidiaries in terms of their correctness, consistency and completeness. The above-mentioned departments operate within
the Financial Accounting and Control Division. Their scopes of responsibilities ensure the division of tasks between support and executive units. The
process of preparing the Bank’s and Group’s financial statements is based on accounting data from the reporting application and is to a large extent
automated, including the consolidation module. Additional reference information (both qualitative and quantitative) is obtained from the Group’s
organisational units in line with their scope of responsibilities.
Moreover, the adequacy and effectiveness of control mechanisms related to financial reporting is assessed by an independent external auditor as part of
the annual certification process for compliance with the Sarbanes-Oxley Act.
Financial reporting is subject to multi-stage verification:
Financial statements are subject to analytical verification carried out by specialists, by the management of units involved in their preparation,
and by specialised controlling entities/ structures. For instance:
Annual and semi-annual financial statements are subject to the mandatory review of a statutory auditor.
Financial statements are formally approved by the Disclosure Committee, which is responsible for ensuring that the financial disclosures of
Santander Bank Polska Group comply with all legal and regulatory requirements before they are released.
Financial statements are submitted for the approval of the Bank’s Management Board and approved by all Management Board members with
qualified electronic signatures.
Annual and interim financial statements are also reviewed by the Audit and Compliance Committee of the Supervisory Board and approved by
the Supervisory Board.
The Audit and Compliance Committee monitors the financial reporting process, taking into account information about changes in the
accounting and reporting policies, analyses all recommendations issued for the Bank’s Management Board by an external auditor (along with
the Management Board’s response), and supervises their implementation.
10. External auditor
Entity authorised to audit financial statements
In accordance with the Bank’s Statutes and applicable regulations and pursuant to the recommendation of the Audit and Compliance
Committee issued in line with the applicable principles, on 13 December 2023 the Bank’s Supervisory Board adopted Resolution no.
161/2023 reappointing PricewaterhouseCoopers Polska spółka z ograniczoną odpowiedzialnością Audyt sp.k. (PwC) to:
• review the Bank’s semi-annual financial statements and the Group’s semi-annual consolidated financial statements for H1
2024;
• audit the Bank’s financial statements and the Group’s consolidated financial statements for 2024.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
PWC also conducted a review of the half-yearly financial statements of the Bank and the half-yearly consolidated financial statements
of the Group for the first half of 2023 and an audit of the financial statements of the Bank and the consolidated financial statements of
the Group for 2023 based on Resolution of the Supervisory Board of the Bank No. 103/2022 of September 28, 2022 and the agreement
of June 28, 2023 concluded between the Bank and PwC to audit and review financial statements for the accounting period from January
1, 2023 to December 31, 2023.
The foregoing audit firm has been providing services to the Bank since 2016. The Bank also uses advice services provided by this firm
and other entities from the PwC network. In the Bank's view, the above services do not affect the impartiality or independence of the
auditor.
Santander Bank Polska S.A. and Banco Santander S.A. retain auditors from the same network, which ensures a consistent approach to
the audit process across Santander Group.
Santander Bank Polska S.A. selects an entity authorised to audit financial statements pursuant to the Auditor Appointment Policy
(adopted by the Supervisory Board on 4 October 2017 pursuant to the recommendation of the Audit and Compliance Committee, and
amended on 25 April 2019). The Policy complies with Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16
April 2014 on specific requirements regarding statutory audit of public-interest entities and the Polish Act of 11 May 2017 on statutory
auditors, audit firms and public oversight.
Detailed rules of cooperation with the audit firm and the audit team are specified in the Audit Services Policy of Santander Bank Polska
S.A. of 6 May 2021.
Selection of external auditor
A decision to appoint or reappoint an entity authorised to audit the Bank’s and the Group’s financial statements is made by the Bank’s
Supervisory Board based on the recommendation of the Audit and Compliance Committee.
Pursuant to the Auditor Appointment Policy of Santander Bank Polska S.A., the Bank selects an audit firm pursuant to the following
rules:
The Bank and the Committee may invite any audit firm to place bids for carrying out statutory audits on condition of a four-year
cooling-off period after the end of the relationship following the expiry of the maximum duration of the engagement.
An audit firm is selected taking into account findings and conclusions made in the annual report of the Polish Agency for Audit
Oversight published on its website.
The Audit and Compliance Committee’s recommendation regarding the selection of an entity authorised to audit financial
statements takes into consideration the following aspects where applicable:
INITIAL ENGAGEMENT OF AN AUDITOR:
at least two audit firms to choose from, along
with the rationale and the Audit and
Compliance Committee’s justified preference
for one of them;
competencies of the audit firms and their
ability to perform the required services;
independence of the entity authorised to audit
financial statements;
legal requirements;
consistency and effectiveness of the audit from
the Group’s perspective as well as from the
higher-level consolidation perspective;
comparison of individual proposals in
accordance with the agreed criteria, having
REAPPOINTMENT OF THE AUDITOR:
assessment of the quality of services
provided to date;
independence of the entity authorised to
audit financial statements;
legal requirements;
consistency and efficiency of the audit
from local Group perspective as well as
from the higher level consolidation
perspective.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The Bank/ the Group complies with the applicable laws with respect to the minimum and maximum duration of an audit
engagement and the minimum cooling-off period.
The recommendation issued by the Audit and Compliance Committee before the appointment of PricewaterhouseCoopers Polska spółka
z ograniczoną odpowiedzialnością Audyt sp.k. (formerly: PricewaterhouseCoopers sp. z o.o.) to review and audit the financial statements
of Santander Bank Polska S.A. and Santander Bank Polska Group for 2022, 2023 and 2024 met all the required criteria and was presented
to the Supervisory Board as part of the selection procedure carried out in accordance with the applicable principles (reappointment of
the auditor). The process included, among other things, the assessment of PwC’s independence and the quality of services provided to
date.
Permitted non-audit services
The rules for provision of permitted non-audit services to Santander Bank Polska S.A. by the audit firm performing the audit, entities
connected with the audit firm or by members of the audit firm network are laid down in the Policy for audit-related and non-audit
services rendered by the auditor, which was reviewed by the Audit and Compliance Committee and approved by the Supervisory Board
on 29 September 2021. The Policy meets the requirements arising from Act on statutory auditors, audit firms and public oversight as
well as EU regulations, including Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific
requirements regarding statutory audit of public-interest entities and Directive 2014/56/EU of the European Parliament and of the
Council of 16 April 2014 on statutory audits of annual accounts and consolidated accounts.
Pursuant to the foregoing Policy:
Appointment of an auditor to render audit-related or permitted non-audit services must be approved by the Audit and
Compliance Committee based on the assessment of whether such services will not affect the independence of the auditor.
Once a year, before the conclusion of the audit of the Group’s annual financial statements, summary information on non-audit
services is sent to the Committee for assessment of their potential impact on the auditor’s independence and objectivity.
When the statutory auditor or the audit firm provides permitted non-audit services to the audited entity, its parent undertaking
or its controlled undertakings, for a period of three or more consecutive years, the total fees for such services must not exceed
70% of the average total fees paid in the last three consecutive years for statutory audits of separate and consolidated financial
statements of the above-mentioned entities. The above limit does not apply if the auditor has not rendered non-audit services
for at least one year.
The scope of permitted services (i.e. services which, under the existing regulations, the statutory auditor can provide when auditing the
financial statements of the Bank/ Group) includes audit-related services (e.g. review of interim financial statements, assurance services)
and non-audit services (e.g. general advisory services).
The Policy also lists prohibited services. Specifically, the auditor must not:
audit and/or review its own work (self-review);
regard to the weights allocated on the basis of
a relevant questionnaire.
In the present legal landscape engagement of the same audit firm cannot exceed 10 years, which is compliant with stipulations
of EU Regulation No 537/2014.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
perform a management role in the audited company or in relation to the services provided (management functions);
represent the audited company or Group (advocacy).
In addition, it is not permitted to provide accounting, financial, actuarial, outsourcing (as part of internal audit) and mediation services
as well as services related to valuation, design and implementation of financial information systems and specific tax services.
In 2023, PwC, the audit firm appointed to audit the financial statements of Santander Bank Polska S.A. and its Group for 2022 and 2023
(along with other entities from the PWC network) provided the following permitted non-audit services:
review of interim financial statements of the Bank/ Group;
verification of consolidation packages;
verification of capital adequacy disclosures;
verification of reports on remuneration of the Management and Supervisory Boards;
services connected with an issue prospectus;
assurance services related to safekeeping of customers’ assets;
assurance services related to corporate social responsibility for the period ended 31 December 2023
assurance services related to risk management and prospectuses for Santander TFI S.A.
The Audit and Compliance Committee approved the appointment of PwC and other entities from its network to provide the foregoing
permitted non-audit services. Before the relevant recommendations were presented to the Supervisory Board, the independence of
the auditor had been verified with a positive outcome.
Remuneration of external auditor
The table below shows the remuneration paid to PricewaterhouseCoopers Polska spółka z ograniczoną odpowiedzialnością Audyt sp.k.
(PwC) in 2022 and 2023 for the audit of the financial statements of Santander Bank Polska S.A. and its subsidiaries, and for audit-related
services and other permitted services rendered under the agreements in place.
1) Fees in respect of audits performed by PricewaterhouseCoopers sp. z o.o. Audyt sp.k. in 2022 and 2023 under the agreements with Santander Bank Polska S.A. on audit
and review of financial statements of 27 June 2022 and 28 June 2023, including assurance services with respect to the compliance of annual financial statements with
the requirements of the European Single Electronic Format (ESEF). Pursuant to Annex 1 of 26 October 2023 to the Agreement of 28 June 2023, in 2023 PwC also audited
the Interim Condensed Special Purpose Financial Statements of Santander Bank Polska S.A. for the 9-month period ended on 30 August 2023.
2) Fees in respect of the review of financial statements under the agreements referred to in point 1 and for assurance services related to capital adequacy disclosures,
report on remuneration of Management and Supervisory Board members, CSR report for 2023, compliance with requirements regarding the custody of customers’
assets, report on risk management system and prospectuses for Santander TFI S.A.
3) Fees in respect of non-assurance services refer to the issuance of attestation letters made in connection with the EMTN prospectus.
Remuneration of external auditor (PLN k)
Financial year
ended 31 December
2023
Financial year
ended 31 December
2022
Audit fees in respect of the parent entity
1)
4,516
3,092
Audit fees in respect of the subsidiaries
2,786
2,419
Fees in respect of other assurance services, including the review of the accounts of the parent
entity and subsidiaries
2)
1,574 1,236
Fees in respect of non-assurance services
3)
414
363
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
XIV. Statement on non-financial information in
2023
1. Business model, strategy and key performance indicators
Business model
The business model of the Santander Bank Polska Group is invariably based on offering state-of-the-art financial solutions to private customers, micro,
small and medium-sized enterprises and Polish and multinational corporations. The Group provides a wide range of domestic and international banking
and financial services. Our priority is to ensure the loyalty of our customers and the commitment of our employees, which leads to an increase in revenues,
receivables and deposits.
The Bank’s offer is modern, comprehensive and meets the diverse needs of its customers in terms of bank accounts, credit, savings and investment,
settlement, insurance and card products. The Bank’s services include cash management, payments and foreign trade services, capital market operations,
money market, foreign exchange and derivative transactions, as well as guarantee and brokerage services. Santander Bank Polska S.A. is one of the
market leaders when it comes to the use of modern banking technologies and is consistently building its brand to become the bank of choice for
customers in line with its strategic objective.
Santander Bank Polska S.A.’s own range of products is supplemented by the specialised products of the affiliated Group companies, such as Santander
Towarzystwo Funduszy Inwestycyjnych S.A., Santander Leasing S.A., Santander Factoring Sp. z o.o. and Santander Consumer Bank S.A. Through
cooperation with these companies, the Bank provides customers with access to investment funds, asset portfolios, leasing and factoring products and
consumer loans:
Santander Bank Polska S.A.
As a universal bank, it provides a full range of services to individuals, small and medium-sized businesses and
large enterprises, corporations and public sector institutions.
Santander Towarzystwo Funduszy
Inwestycyjnych S.A.
The company manages assets held in investment funds. It has many years of experience in setting up and
managing Employee Pension Schemes and Individual Retirement Accounts.
Santander Leasing S.A.
The company offers financing of a wide range of fixed assets for customers form the SME sector and corporate
clients. Santander Leasing’s main products are operating leases, finance leases, loans for the purchase of fixed
assets and land, as well as vehicle rental.
Santander Factoring Sp. z o.o.
The company offers financing of sales (factoring of receivables) to Polish and foreign customers and of
purchases (factoring of payables) from domestic and foreign suppliers. The company’s clients include small
and medium-sized enterprises, large enterprises and multinational corporations with a global footprint.
Santander Consumer Bank S.A.
The bank focuses on meeting the credit needs of households, mainly in the Consumer Finance sector and the
car loan market. It also finances businesses, mainly car dealers and importers. Santander Consumer Bank’s
offer includes consumer loans, financing car purchases through loans, leasing and factoring, lending to car
dealers, retail and business deposits and insurance.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Value creation process
A key focus of the Group’s strategy is to embed a strong
corporate culture based on Simple, Personal and Fair values.
How we do things is as important as what we do.
Maintaining an employee engagement level above the banking
sector average is the key measure of success of the Group’s
strategy.
Higher number of loyal customers means higher income, loans
and deposits.
Loyal customers more often choose digital channels, use more
products and services and initiate more transactions with the
bank.
Motivated
and engaged employees...
… mean more satisfied
and loyal customers…
… resulting in higher investment
in the community
… driving profitability
and sustainable growth …
The Group makes investments for the future in partnership
with universities, supporting education and financing
environmental projects.
It generates sound financial performance in a responsible way,
supporting sustainable growth and social inclusion.
Focus on customer loyalty allows the Group:
to achieve satisfactory financial results in the short
and long term
to strengthen its balance sheet and capital
to be more resilient and more effectively respond to risks
if they materialise.
Our competitive advantage stems from:
stable sources of funding, a solid capital and liquidity base,
a diversified asset portfolio,
a clear, coherent, consistently implemented strategic vision underpinned by customer focus and operational efficiency,
simple processes, digital technologies and implementation of agile operating principles,
an effective and simple business model,
a diverse range of activities,
being part of the global Banco Santander Group and benefiting from its international experience.
We undertake all activities with our customers and their needs in mind. We design products, processes and channels of communication with customers
using service design, so that our customers are satisfied with the services and keen to continue the relationship.
The single most important element in creating the value offered to customers is our employees. We build supportive working environment and
organisational culture by promoting cooperation, equality, diversity and inclusiveness and by enhancing employee motivation, engagement and skills.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Development strategy
Between 2021 and 2023, Santander Bank Polska Group pursued a strategy based on the adopted mission and six strategic directions: “Customer
obsession”, “Employee focus”, “Simplification”, “Omnichannel”, “Evolution to an open platform”, “Safety and trust”. The strategic directions adopted
were interdependent. They indicated the key areas for the Group’s transformation. Each of them referred to the issue of sustainable development, with
particular emphasis on the one named “Safety and trust”.
An important part of our business strategy in 2023 was the Responsible Banking Strategy, which defined our approach to ESG issues. The starting point
in its implementation lied in strengthening the corporate culture and reinforcing the Bank’s commitment to sustainable financing.
Our mission Help people and businesses prosper
Our vision
Be the Best Open Financial Services PLATFORM by acting RESPONSIBLY
and earning the lasting LOYALTY of our people, customers, shareholders and communities
Our values Simple – Personal - Fair
Behaviours
Think
customer
Embrace
change
Act now
Move
together
Speak up
Strategic directions
Customer
obsession
Employee
focus
Simplification Omnichannel
Evolution to
Open Platform
Safety
and trust
The Bank reviewed the achievement of its strategic objectives at the highest management level by monitoring the actual performance versus the
ambitions set. The results were discussed quarterly at meetings of the Bank’s Management Board and Supervisory Board. These ambitions are shown in
the table below.
Our ambitions
Cost-to-Income ratio (C/I)
<40%
Dividend payout ratio
50% of the profit for the period
Total capital ratio (TCR)
Dividend triggering level
Cost of credit risk (CoR)
Pre-pandemic (COVID-19) average covering the entire business cycle
In 2023, the Santander Bank Polska Group achieved all its ambitions.
Santander Bank Polska Group strategy for 2024-2026
For the period 2024-2026, the Management Board has adopted for implementation, and the Supervisory Board has approved, the strategy “We help you
achieve more”, which is based on our mission statement “We help people and businesses prosper”, in addition to three strategic directions: Total
Experience, Total Digitalisation and Total Responsibility. The ESG strategy has been fully integrated into the business strategy.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
We continue to live our purpose of helping people and businesses prosper in order to become
the most profitable bank in Poland
THE MOST PROFITABLE BANK IN POLAND
Our mission Help people and businesses prosper
Our vision
Be the Best Open Financial Services PLATFORM by acting RESPONSIBLY
and earning the lasting LOYALTY of our people, customers, shareholders and communities
Our values Simple – Personal - Fair
Behaviours
Think
customer
Embrace
change
Act now
Move
together
Speak up
Strategic directions
TOTAL
Experience
TOTAL
Digitalisation
TOTAL
Responsibility
The strategy of Santander Bank Polska Group has been developed to meet the priorities of the Bank as a modern organisation. Its key pillar is Total
Experience, which is focused on maximising customer and employee experience. Total Digitalisation means further development of digital service
channels for customers and an effective digitalised work environment for employees. Total Responsibility reflects the Bank’s responsible business agenda
and covers both environmental and social aspects.
> Financial and non-financial measures of Santander Bank Polska Group
(as at 31 December 2023 and 31 December,2022)
Number of customers
Number of employees
Number of branches*
2023 7.5 m 11,471 (FTEs) 336
2022 7.4 m 11,309 (FTEs) 351
NPS Mass*
Number of digital
customers*
Number of online
and mobile transactions*
2023 TOP 3 3 497 k 494 m
2022 TOP 4 3,285 k 438 m
C/I
Dividend payout
ratio*
TCR
CoR
2023 29.5% 97.01% 18.56% 0.72%
2022 37.9% 29.90% 19.74% 0.59%
* Applies only to Santander Bank Polska S.A. (the number of branches also includes off-site locations and Santander Zones)
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
2. Responsible banking
Pillars of responsible banking at Santander Bank Polska
Santander Bank Polska S.A. Group builds long-term value for all stakeholders in a sustainable manner. An integral part of the Group’s overall business
strategy for 2021-2023 was the Responsible Banking Strategy, which outlined the organisation’s approach to ESG issues and sustainable development.
The Group aligns its Responsible Banking agenda with the challenges and needs of society in order to help and meet needs in line with the best
international standards, in particular the UN Sustainable Development Goals (SDGs), the Paris Agreement, the UNEP FI’s Principles for Responsible
Banking and the guidelines of Net Zero Banking Alliance.
The Group focuses its business activities on the areas, where it has a real impact as a financial institution. These areas are indicated below:
> Key UN Sustainable Development Goals pursued by the Santander Bank Polska Group
The two fundamental pillars on which the Responsible Banking Strategy is based are: corporate culture and sustainable finance.
> Pillars of Responsible Banking Strategy (2021-2023) at Santander Bank Polska
Corporate culture
Sustainable Finance
Green Bank Inclusive Banking
Strengthening the SPF culture
Diversity
Simplification
Speak Up culture
Taking care
of the environment in both internal
and external activities
Integrating persons at risk of exclusion into the world
of banking services. Educating local communities and
supporting continuous learning
Green offer
Green Bank
Bank for persons with disabilities/
senior citizens
Bank tailored to specific needs of customers
Financial education at every stage of life
Santander Bank Polska Foundation – social and volunteering projects
Santander Universidades
The ethical, social and environmental commitments and principles adopted by the Group are broader than those required by the legal framework. They
are defined in the Responsible Banking and Sustainability Policy which replaced the previous sustainability policy in October 2023. This policy is
supplemented by numerous internal documents and regulations.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Our policies and key regulations for ESG areas
Environment Society Governance
Responsible Banking Corporate Framework
Responsible Banking and Sustainability Policy
Social, Environmental and Climate Change Risk Management Policy
General Code of Conduct
Responsible Banking Strategy (2021-2023)
”We Help You Achieve More” Business Strategy (2024-2026)
Net Zero Strategy
Sustainable and Responsible
Investment Policy
Global Sustainable Bond
Framework Policy
Framework on Green Bonds
Policy on Engagement
in Companies Listed on a
Regulated Market and
Application of Corporate
Governance Measures
”Respect and Dignity” Policy
Corporate Culture Policy of Santander Bank Polska Group
Corporate Governance Rules
of Santander Bank Polska Group
Policy of Diversity in the Composition of the Management
Board of Santander Bank Polska S.A.
Specific Corporate Frameworks
Remuneration Policy of Santander Bank Polska Group Information Policy of Santander Bank Polska S.A.
Remuneration Policy for the Members of the
Management Board of Santander Bank Polska S.A.
Code of Conduct in the Securities Markets
Remuneration Policy for Members of the Supervisory
Board of Santander Bank Polska S.A.
Group Subsidiary Governance Model and Guidelines for
Subsidiaries
Defence Sector Policy Anti-Money Laundering Policy
Policy for Selection and Assessment of Suitability of Management Board Members and Individuals Performing Key
Functions at Santander Bank Polska S.A.
Conflicts of Interest Prevention Policy
Anti-Bribery and Corruption (ABC) Policy
Procurement Policy of Santander Bank Polska S.A.
Santander Bank Polska S.A. Supplier Selection Procedure Sustainable and Responsible Investment Policy
Policy for Cooperation with Suppliers and Outsourcing at
Santander Bank Polska
Policy on Engagement with Listed Companies and
Application of Corporate Governance Measures
Procedure of Supplier Management and Outsourcing at
Santander Bank Polska S.A.
As of 2021, the process of achieving the goals of the Responsible Banking Strategy (2021-2023), including the implementation of tasks in favour of the
environment and against climate change, is one of the criteria for determining the amount of bonuses awarded to members of the bank’s Management
Board. The progress achieved in a given year in 3 key areas including:
promoting diversity,
supporting clients and local communities by facilitating access to financial services, and financial education,
development of green offer.
In addition, the members of the Management Board and executives have the implementation of the Responsible Banking agenda embedded in their
objectives. Starting in 2021, the implementation of the Responsible Banking priorities is one of the objectives of the Bank’s operational strategy, which
accounts for, minimum 10% of the assessment under the “WHAT” component.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Key ESG achievements in 2023
> Achievement of Responsible Banking objectives of Santander Bank Polska S.A.
No.
Result in 2022
Result in 2023
1. Top 10 employers (ranking position) Top Employer Certificate Top Employer Certificate
2. Women in senior positions 34.7% 34.96%
3.
Equal Pay Gap ratio
2.00%
1.17%
4.
Number of people financially empowered from 1 Jan, 2019
651,453
1,732,963
5.
Green finance compliant with SFCS (in PLN million)*
2,668
5,499
6.
Electricity from renewable sources (%)**
83.5%
88%
7. Elimination of single-use plastics (% implementation) 100% 100%
8. Scholarships, internships and job placements (number) 5,915 17,355
9.
Number of people helped***
493,461
113,089
* Change in the presentation of the indicator - amount in millions of PLN. SFCS - Sustainable Finance Classification System
** Electricity purchased directly by the Bank
*** The result in 2022 were impacted by initiatives implemented as part of humanitarian aid to Ukraine
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
> Additional ESG achievements:
E
ENVIRONMENT
Value of green financing according to the internal Sustainable Finance Classification System (SFCS): PLN 5,499m,
including:
Green buildings: PLN 3,795.13m
RES: PLN 1,578.30m
Value of sustainability-linked loans: PLN 2,172m
Launch of Carbon Footprint functionality in the mobile app and in online banking
Implementation of the ESG Database project -
preparation for reporting under European regulations (EU Taxonomy,
Pillar 3, CSRD)
S
SOCIETY
Total investment in activities for local communities: PLN 2,834,191
Support for employees with wellbeing and benefit offer
„Knowledge bank”: ESG education for employees
Number of beneficiaries of financial education activities from 2019: 1,578,399
Number of people financially empowered through facilitated access to products and services: 145,849
Funding of social projects and higher education
Participation in the “Sustainable Tomorrow” project for education: 320 students at 3
universities in the academic
year 2023/2024
Presence for the third time on the Diversity IN Check list -
the most advanced employers in terms of diversity and
creating inclusive workplaces
Certification as a “Great Place to Work!”
The Banker’s award for inclusive banking
G
GOVERNANCE
Maintenance of ESG ratings performance:
Sustainalytics (Low Risk)
MSCI (AA)
CSA (48)
Second place in the Responsible Company Ranking 2023
“Ethical Company 2022” title from Puls Biznesu
The “Golden CSR Leaf of Polityka” award (for the second consecutive year)
Main award for ESG Report 2022 in the „Sustainability Reports” competition organised by the Responsible Business
Forum and Deloitte
“The Best Annual Report” - special award for the best sustainability report in the category “
Banks and financial
institutions”
3. Risk management system
Santander Bank Polska Group modifies and develops risk management methods on an ongoing basis, taking into consideration changes in the Group’s
risk profile and in the economic environment as well as regulatory requirements and best market practice. The directions are set by the Management
Board and the Supervisory Board, which actively support the risk management strategy by approving key risk management policies, having its
representatives on the committees responsible for risk management, participating in risk reviews and approving risks and risk reports.
The risk management system of the Bank and the Group complies with the banking industry standards and legal and regulatory guidelines and
recommendations. Selected units are responsible for identification, measurement, monitoring and mitigation of risks. Based on the overall risk level, a
risk profile is defined. Risk appetite, together with risk limits, is reflected in the Risk Appetite Statement adopted by the Management Board and approved
by the Supervisory Board.
Santander Bank Polska S.A. distinguishes the following material risks in its risk management system:
credit risk (including concentration risk),
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
market risk (from the banking and trading book),
liquidity risk,
operational risk,
compliance risk,
reputational risk.
From the point of view of the negative impact of individual risks on social, environmental, labour, respect for human rights and anti-corruption issues,
operational, compliance and reputational risks are of particular importance. In addition, the bank has identified social and environmental risks, including
climate risks, associated with the financing of customer projects in sensitive sectors.
Management of social, environmental and climate change risks
The processes for considering ESG factors in decision-making are outlined in the Responsible Banking and Sustainability Policy. As separate regulation
we follow the Social, Environmental and Climate Change Risk Management Policy. It defines the criteria for the cooperation, identification, assessment,
monitoring and management of environmental and social risks and other actions affecting climate change undertaken by clients, particularly in the
sectors of oil and gas mining, exploration and processing, energy, soft commodities, mining and metals. Within the aforementioned sectors, the policy
classifies areas of activity into two categories: prohibited activities and activities subject to additional analysis. More details can be found in chapter XII,
section 7 “ESG risk management”.
We also take ESG criteria into account when making investment decisions. Santander Bank Polska Group – and in particular its subsidiary Santander TFI
– strictly adheres to the Sustainable and Responsible Investment Policy and the Policy on Engagement in Companies Listed on a Regulated Market and
Application of Corporate Governance Measures. We are positive that the integration of environmental, social and governance in investing activities makes
it possible to improve risk management and create added value - both for clients and for the society as a whole. Considering both financial and non-
financial factors allows us to have a more complete picture of the assets we manage and to make more balanced investment decisions.
Asset investments are preceded by a detailed assessment, conducted according to ESG criteria, which serves to identify issuers that are well prepared for
the challenges ahead, those with policies and governance systems that are likely to have a significant positive impact on society and the environment.
The ESG assessment includes, but is not limited to:
a proprietary methodology for assessing issuers’ attitudes towards environmental and social factors. We use information supplied by external data
providers for this purpose. The methodology is based on market reference data and international guidelines and standards. Its outcome is an
assessment of individual issuers;
exclusions based on the nature of the issuers’ business.
The basis for ESG assessment of companies is the concept of double materiality. We take into account the impact of ESG criteria on investments, as well
as the impact of investments on sustainability. The assessment includes general analysis criteria - common to all sectors - and specific criteria depending
on the sector and type of business. We expect issuers to publish ESG reports and we also make relevant disclosures ourselves.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
4. Environmental policies and their outcomes
Banco Santander Group’s climate strategy and Global Net Zero Strategy
We are pursuing a climate strategy that is consistent with the Banco Santander Group’s global Net Zero strategy adopted in 2021. We are implementing
measures to align our portfolio with the objectives of the Paris Agreement, the TCFD recommendations and the European Union’s policies, which indicate
a major role for the financial sector in tackling climate change. Therefore, we want to achieve zero net emissions by 2050, and this target applies to the
entire value chain of the Santander Bank Polska Group.
The exchange of international good practices is also expected to contribute to achieving the climate ambition. Banco Santander Group is a founding
member of the Net Zero Banking Alliance. This is a UN initiative spearheaded by the banking sector that guides our further work on portfolio analysis.
The Net Zero strategy assumes:
to discontinue the financing of energy companies with more than 10% of their revenues coming from coal-fired power generation, by 2030 at the
latest,
to discontinue the provision of credit services to thermal coal producers by 2030,
to support customers in the transition process by offering comprehensive financing for renewable energy sources and the development of adequate
financial products.
In terms of own greenhouse gas emissions (resulting from electricity consumption and business travel, among other things), the Group achieved carbon
neutrality in 2020 (net zero CO2 emissions) using an offset mechanism.
We aim to achieve the targets set by the Global Net Zero Strategy in the medium and long term thanks to the decarbonisation levers identified and
implemented. We materialise them by reducing the Group’s own emissions (with the aim of lowering the share of offsets) and the emissions associated
with the financial services we provide - lending, advisory or investment services.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The Group’s actions towards customers in the climate area, reducing exposure to climate risks, have so far been as follows:
In 2019
The Group decided not to engage in financing any new thermal coal mines or new power units fired by steam coal.
From 202
0
All agreements made by the Group with entities using coal explicitly forbid allocating the funds granted by the Group
for coal mining or production.
In 2023
A socio-environmental risk assessment process was formalised for financed projects in line with the Equator
Principles.
For clients in sectors with high CO2 emissions (fossil fuel-based energy, coal mining, airlines and steel production),
a structured analysis of business transformation plans towards lower carbon intensity was introduced.
A project was launched to calculate the carbon performance of portfolios according to the PCAF methodology.
To meet the Paris Agreement objectives, the Group committed to take the following steps:
By 2030
Completely reduce the exposure to thermal coal producers (all contracts left to expire).
From 2030
Discontinue financing energy companies whose revenues from thermal coal production accounts for more than
10%.
From 2050
Achieve net zero emissions.
Our most important documents on environmental protection and climate change include:
Responsible Banking Strategy (2021-2023),
”We Help You Achieve More” Business Strategy (2024-2026),
Responsible Banking and Sustainability Policy,
Global Net Zero Strategy,
Sectoral policies,
Social, Environmental and Climate Change Risk Management Policy.
In 2023, the Bank carried out an analysis of the portfolio’s sensitivity to climate risks, taking into account an assessment of the vulnerability of the most
exposed 11 sectors within the portfolio. The analysis was carried out over three time horizons - short-term (2030), medium-term (2040) and long-term
(2050). In contrast to the analysis conducted in previous years, we decided to use the three climate scenarios defined by Network for Greening the
Financial System (NGFS). This group of central banks and supervisors determined to work towards a better understanding and management of climate
risks brings together more than 130 institutions (including major ones such as the European Central Bank, the Bank of England and the US Federal Reserve
System).
The analysis considered the main risks from both categories: physical risks (PhR) and transformational risks (TR). The methodology for assessing climate risks
was also refined in 2023. The analysis was qualitative in nature, but was nevertheless carried out from a double materiality perspective, i.e. considering the
channels of the Group’s impact on climate and the impact of climate on the Group’s performance. Results of the analysis are under attestation and will be
presented in our 2023 ESG Report.
More information on climate risk can be found in chapter XII ” Risk and equity management”, section 7 ”ESG risk management”.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Green finance
In line with the strategic commitment expressed by the Green Bank label, we integrate environmental factors into our products and services and ESG
criteria into our credit analysis. We offer sustainable financial products and support customers in the transformation process.
To this end, since 2022, we have been using the Sustainable Finance Classification System (SFCS), which facilitates the categorisation, tracking and
reporting of sustainable finance activities. This classification system is based on internationally recognised industry guidelines and principles, such as
LMA Green Loan Principles, LMA Social Loan Principles, LMA Sustainability-Linked Loan Principles, ICMA Social and Green Bond Principles, Climate Bond
Standards and EU Taxonomy. The Bank sets targets related to the value of green financing in line with this classification system. In 2023, the total amount
of SFCS-compliant sustainability financing (assigned for environmental and social investments) we provided was PLN 7,671 million.
An important aspect of achieving the Bank’s strategic objectives is the pursuit of compliance with the environmental objectives of the EU Taxonomy. We
take these into account in our products and services. In 2024, for the first time, we are publishing green asset ratios (GAR). They show the proportion of
our assets that represent EU Taxonomy-aligned finance, environmentally sustainable in the context of climate change mitigation and adaptation. As at
the end of 2023, the green asset ratio by stock based on TURNOVER was 0.4% and based on CAPEX 0.5%.
The offer of sustainable financing is aimed at various customer groups, including those from sectors with the greatest impact on climate issues, namely
energy, fuel and manufacturing. The increase in customer awareness observed in recent years has been accompanied by a growing interest in this type
of financing in other sectors.
Below are the documents on sustainable finance in force in the Santander Bank Polska Group.:
Responsible Banking Strategy (2021-2023),
Responsible Banking and Sustainability Policy,
Social, Environmental and Climate Change Risk Management Policy,
Sectoral policies for sensitive sectors,
Sustainable and Responsible Investment Policy,
Policy on Engagement in Companies Listed on a Regulated Market and Application of Corporate Governance Measures (crucial for Santander TFI
S.A.),
Global Net Zero Strategy,
Global Sustainable Bond Framework Policy,
Framework on Green Bonds.
The Bank supports customers in the transition to a low-carbon economy with the suitable product and service offering:
Cross-sector - opportunity to engage in financing decarbonisation projects of existing bank clients,
Energy sector / cross-sector - development of the RES market creating opportunities for investment in projects and companies related to this sector,
Energy sector - opportunities for engagement in projects and cooperation with companies active in the development and modernisation of pumped-
storage power plants,
Transport / automotive - opportunities for engagement in financing projects that promote the uptake of electric or low-emission cars,
Transport / automotive - financing, particularly in the public sector, of low-carbon transport solutions,
Agribusiness sector - working on the development of advisory services for the selection of low carbon solutions for the agribusiness sector and the
enhancement of financial services in this area,
Real estate sector - financing new energy-efficient commercial and residential property projects and financing the thermo-modernisation of existing
buildings.
The Bank also offers dedicated products:
loans for sustainable investments, including RES,
loans linked to the Sustainable Development Goals,
cash loan with ECO promotion,
eco-loan,
green bonds and sustainability bonds,
sustainability-linked bonds,
consulting on sustainable financing options,
financial consulting in the ESG area,
leasing of photovoltaic installations (SolarLease),
leasing of electric vehicles, including subsidised leasing under the “My Electric Car” programme,
leasing of non-emission heat sources, energy storages and electric vehicle charging stations,
investment funds classified as SFDR Article 8 (so-called light green) and SFDR Article 9 (so-called dark green) products.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
Disclosures related to Regulation 2020/852
Scope of Taxonomy disclosures
Regulation (EU) 2020/852 of the European Parliament and of the Council on the establishment of a framework to facilitate sustainable investment (EU
Taxonomy) lays down a unified classification system for sustainable activities designed to increase the transparency and comparability across the market
and support investors in taking investment decisions. This Regulation – along with supplementing Commission Delegated Regulation (EU) 2021/2178
(as amended) specifying the content, methodology and presentation of information concerning environmentally sustainable activities – imposed
additional reporting obligations on undertakings required to provide non-financial disclosures in accordance with the Non-Financial Reporting Directive
(undertakings subject to NFRD). In the case of Santander Bank Polska S.A. and other credit institutions, the foregoing legislation became fully effective
in 2024 (except for two forms applicable as of 2026) following the two-year transition period from 1 January 2022 to 31 December 2023, during which
the disclosures were limited and focused on the eligibility of activities. In view of the above and in accordance with the interpretation of Commission
Delegated Regulation (EU) 2021/2178 on Taxonomy disclosures presented in Commission Notice (C/2023/305), Santander Bank Polska Group is not
required to disclose the comparative key performance indicators for 2022 in its Taxonomy reporting for 2023.
The Taxonomy covers six environmental objectives: climate change mitigation, climate change adaptation, the sustainable use and protection of water
and marine resources, the transition to a circular economy, pollution prevention, and the protection and restoration of marine and terrestrial ecosystems.
As part of GAR reporting for 2023, Santander Bank Polska Group conducted a complete Taxonomy analysis (at the level of a single transaction) with
regard to two climate objectives defined in Commission Delegated Regulation (EU) 2021/2139: climate change mitigation and climate change adaptation.
The results are presented in the tables included in section: “Templates presenting GAR calculation”.
Activities indicated as contributing substantially to other four climate objectives, as specified in Commission Delegated Regulation (EU) 2023/2486, have
been assessed only in terms of Taxonomy eligibility based on customers’ business codes in the NACE system. They are presented at an aggregated level
They are presented at an aggregate level in the table below “Eligibility of exposures with regard to four environmental objectives”.
The transactions identified were related to the circular economy objective. The transactions were presented according to the NACE sector classification
up to level 2.
NACE
Eligible exposures with regard to four environmental objectives
defined in Commission Delegated Regulation (EU) 2023/2486
B.07 Mining of metal ores
1,303,082.3
C.11 Manufacture of beverages
4,799.3
C 17 Manufacture of paper and paper products
320.2
C.19 Manufacture of coke and refined petroleum products
223,027.2
C.20 Manufacture of chemicals and chemical products
464,696.6
C.22 Manufacture of rubber and plastic products
1,934.8
C.27 Manufacture of electrical equipment
101.4
C.28 Manufacture of machinery and equipment n.e.c.
56,204.3
C.30 Manufacture of other transport equipment
18.5
D.35 Electricity, gas, steam and air conditioning supply
270,818.3
F.41 Construction de bâtiments
46,118.8
F.42 Génie civil
681.0
G.45 Wholesale and retail trade and repair of motor vehicles and motorcycles
257,592.0
G.46 Wholesale trade, except of motor vehicles and motorcycles
644,853.2
G.47 Retail trade, except of motor vehicles and motorcycles
858,830.1
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
J.58 Publishing activities
29,184.5
J.61 Telecommunications
283,990.4
J.62 Computer programming, consultancy and related activities
0.3
J.63 Information service activities
87,720.8
K.66 Activities auxiliary to financial services and insurance activities
189.7
L.68 Real estate activities
61,384.9
M.70 Activities of head offices; management consultancy activities
270,907.8
N.77 Rental and leasing activities
10,927.1
N.79 Travel agency, tour operator and other reservation service and related
activities
0.2
N.82 Office administrative, office support and other business support activities
192,169.4
R.93 Sports activities and amusement and recreation activities
46,139.7
Total
5,115,692.4
Pursuant to Commission Delegated Regulation (EU) 2022/1214 amending Delegated Regulation (EU) 2021/2139 as regards economic activities in certain
energy sectors and Delegated Regulation (EU) 2021/2178 as regards specific public disclosures for those economic activities, the Group provides the
following information on exposure to the financing of nuclear and fossil gas related activities.
Nuclear energy related activities
1
The undertaking carries out, funds or has exposures to research, development,
demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear
processes with minimal waste from the fuel cycle.
NO
2
The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear
installations to produce electricity or process heat, including for the purposes of district heating or industrial
processes such as hydrogen production, as well as their safety upgrades, using best available technologies.
NO
3
The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that
produce electricity or process heat, including for the purposes of district heating or industrial processes such as
hydrogen production from nuclear energy, as well as their safety upgrades.
NO
Fossil gas related activities
4
The undertaking carries out, funds
or has exposures to construction or operation of electricity generation facilities
that produce electricity using fossil gaseous fuels.
NO
5
The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined
heat/cool and power generation facilities using fossil gaseous fuels.
NO
6
The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat
generation facilities that produce heat/cool using fossil gaseous fuels.
NO
Key performance indicators for Taxonomy purposes
The key performance indicator for sustainable activities of credit institutions is the green asset ratio (GAR), which shows investments and exposures
related to Taxonomy-aligned sustainable activities with regard to the environmental objectives as a proportion of the assets included in the GAR
calculation.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
The GAR numerator considers loans and advances, debt securities and equity instruments in the banking book in respect of undertakings subject to NFRD,
loans secured by residential properties, building renovation loans and car loans for households, and loans for local governments. Assets included in the
GAR denominator (covered assets) are total gross assets excluding exposures to central governments, exposures to central banks and the trading book.
Below are the key performance indicators (KPIs) of Santander Bank Polska Group calculated with regard to two climate objectives by the ratio (turnover
or CapEx) used to calculate the Taxonomy eligibility and Taxonomy alignment of general purpose exposures to customers subject to the NFRD. The GAR
based on flow and KPIs for off-balance sheet exposures (financial guarantees and assets under management) are included as well. The KPIs are presented
using the table contained in Annex VI to Commission Delegated Regulation (EU) 2023/2485 amending Delegated Regulation (EU) 2021/2139.
> Summary of KPIs
Total
environment-
ally sustainable
assets
(TURNOVER)
Total
environment-
ally sustainable
assets
(CAPEX)
KPI
(TURNOVER)
KPI
(CAPEX)
% coverage
(over total
assets)
% of assets
excluded
from the
numerator
of the GAR
% of assets
excluded
from the
denominator of
the GAR
Main KPI
Green asset
ratio (GAR)
stock
Green asset ratio (GAR)
stock
826,727.4
1,127,250.3
0.4%
0.5%
77.9%
7.1%
22.1%
Financial
guarantees
0.0
0.0
0.0%
0.0%
Assets under
management
128,785.4 128,785.4 9.6% 9.6%
Total
environmentall
y sustainable
assets
(TURNOVER)
Total
environmentally
sustainable assets
(CAPEX)
KPI
TURNOVE
R
KPI
CAPEX
% coverage
(over total
assets)
% of assets
excluded
from the
numerator
of the GAR
% of assets
excluded
from the
denominator of
the GAR
Additional
KPIs
Green asset
ratio (GAR)
flow
Green asset ratio (GAR)
flow
256,134.8
225,849.5
0.5%
0.6%
80.3%
0.9%
19.7%
Financial
guarantees
0.0
0.0
0.0%
0.0%
Assets under
management
120,210
120,210
19.2%
19.2%
Templates presenting GAR calculation
Quantitative disclosures for two climate objectives
The tables below include quantitative information of Santander Bank Polska Group subject to disclosure as of 1 January 2024 in relation to two climate
objectives as specified in Article 4(2) of Commission Delegated Regulation (EU) 2021/2178 supplementing Regulation 2020/852.
They include balance sheet and off-balance sheet assets used to calculate KPIs of Santander Bank Polska Group by stock as at the end of the reporting
period and by flow (understood as exposures originated in a given financial year and reflected in the stock as at the end of the reporting period). They are
presented by the ratio (turnover or CapEx) used to calculate the Taxonomy eligibility and Taxonomy alignment of general exposures to customers subject
to the NFRD.
Apart from the total GAR, partial Green Asset Ratios are disclosed, broken down by climate objective, customer segment and financial instrument. In
addition, supplementary KPIs for financial guarantees and assets under management are calculated.
The figures presented in the tables come from the FINREP templates, i.e. financial statements consolidated for prudential purposes, prepared for central
banks. The aggregates and their components have the same information content and limitations as FINREP reports. Information about individual
customers and products (including leasing and factoring) which was not available in FINREP was taken from the corporate data warehouse in accordance
with the FINREP granularity and from the non-financial information system developed by Santander Bank Polska S.A. for ESG reporting purposes. Data
about customers and products of Santander Consumer Bank S.A. and its subsidiaries were obtained directly from those entities.
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
211
> Assets for the calculation of GAR by stock and turnover
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally sustainable
(Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
69,738,157.5 55,366,053.3
826,727.4
0.0 2.3 54,603.9 0.0 0.0 0.0 0.0 55,366,053.3 826,727.4 0.0 2.3 54,603.9
2
Financial undertakings
11,765,208.7
2,437,188.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,437,188.8
0.0
0.0
0.0
0.0
3
Credit institutions
11,730,707.4
2,437,016.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,437.016.0
0.0
0.0
0.0
0.0
4
Loans and advances
11,210,991.0
2,208,340.8
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,208,340.8
0.0
0.0
0.0
0.0
5
Debt securities, including UoP
519,716.4
228,675.2
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
228,675.2
0.0
0.0
0.0
0.0
6
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
7 Other financial corporations 34,501.3 172.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 172.7 0.0 0.0 0.0 0.0
8
of which investment firms
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
0.0
9
Loans and advances
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
0.0
10
Debt securities, including UoP
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
0.0
11
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
12
of which management companies
2,178.7
11.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
11.1
0.0
0.0
0.0
0.0
13 Loans and advances 2,178.7 11.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 11.1 0.0 0.0 0.0 0.0
14
Debt securities, including UoP
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
0.0
15
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
16
of which insurance undertakings
32,322.6
161.6
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
161.6
0.0
0.0
0.0
0.0
17
Loans and advances
32,322.6
161.6
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
161.6
0.0
0.0
0.0
0.0
18
Debt securities, including UoP
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0,0
0.0
0.0
0.0
0.0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
212
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
19 Equity instruments 0.0 0.0
0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
20 Non-financial undertakings 5,758,050.6 819,146.4
82,471.5
0.0 2.3 54,603.9 0.0 0.0 0.0 0.0 819,146.4 82,471.5 0.0 2.3 54,603.9
21 Loans and advances 5,758,050.6 819,146.4
82,471.5
0.0 2.3 54,603.9 0.0 0.0 0.0 0.0 819,146.4 82,471.5 0.0 2.3 54,603.9
22 Debt securities, including UoP 0.0 0.0
0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
23 Equity instruments 0.0 0.0
0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
24 Households 52,109,718.1 52,109,718.1
744,255.9
0.0 0.0 0.0 0.0 0.0 0.0 0.0 52,109,718.1 744,255.9 0.0 0.0 0.0
25
of which loans collateralised by
residential immovable property
50,439,910.6 50,439,910.6 285,200.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 50,439,910.6 285,200.4 0.0 0.0 0.0
26
of which building renovation loans
743,558.1
743,558.1
459,055.5
0,0
0,0
0,0
0.0
0.0
0.0
0.0
743,558.1
459,055.5
0.0
0.0
0.0
27
of which motor vehicle loans
926,249.5
926,249.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
926,249.5
0,0
0.0
0.0
0.0
28
Local governments financing
105,180.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
29 Housing financing 12,849.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
30
Other local government financing
92,330.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
31
Collateral obtained by taking
possession: residential and
commercial immovable properties
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
32
Assets excluded from the numerator
for GAR calculation (covered in the
denominator)
20,206,931.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
33
Financial and Non-financial
undertakings
95,435,967.4
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
213
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
34
SMEs and NFCs (other than SMEs)
not subject to NFRD disclosure
obligations
67,759,208.9
35
Loans and advances
67,713,917.9
36
of which loans collateralised by
commercial immovable property
0.0
37
of which building renovation loans
0.0
38
Debt securities, including UoP
0.0
39
Equity instruments
45,291,0
40 Financial undertakings
26,950,158.2
41
Non-EU country counterparties not
subject to NFRD disclosure
obligations
726,600.4
42
Loans and advances
710,910.5
43
Debt securities, including UoP
4,010.8
44
Equity instruments
11,679.0
45
Derivatives
1,575,056.3
46
On demand interbank loans
2,019,784.9
47
Cash and cash-related assets
8,417,519.1
48
Other categories of assets (e.g.
Goodwill, commodities etc.)
43,620,763.1
49
Total GAR assets
220,807,248.3
55,366,053.3
826,727.4
0.0
2.3
54,603.9
0.0
0.0
0.0
0.0
55,366,053.3
826,727.4
0.0
2.3
54,603.9
50
Assets not covered for GAR
calculation
62,799,747.2
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
214
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
51
Central governments and
Supranational issuers
47,503,665.5
52
Central banks exposure
6,246 368.2
53 Trading book 9,049,713.6
54
Total assets
283,630,255.1
Off-balance sheet exposures -
Undertakings subject to NFRD
disclosure obligations
55
Financial guarantees
22,196.6
188.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
188.1
0.0
0.0
0.0
0.0
56 Assets under management 19,188,939.2 1,112,753.1 128,714.8 0.0 12,968.7 115,746.1 228,162.7 70.6 0.0 70.6 1,340,915.8 128,785.4 0.0 12,968.7 115,816.7
57
Of which debt securities
15,530,809.5
683,442.1
63,402.2
0.0
6,964.8
56,437.5
149,502.5
61.7
0.0
61.7
832,944.5
63,463.9
0.0
6,964.8
56,499.1
58
Of which equity instruments
3,652,405.5
436,932.7
65,779.9
0.0
6,047.7
59,732.1
79,556.1
9.1
0.0
9.1
516,488.8
65,789.0
0.0
6,047.7
59,741.2
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
215
> Assets for the calculation of GAR by stock and CapEx
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally sustainable
(Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
69,738,157.5 56,212,007.9
1,127,250.3
0.0 9,086.7 235,854.8
0.0 0.0 0.0 0.0 56,212,007.9 1,127,250.3 0.0 9,086.7 235,854.8
2
Financial undertakings
11,765,208.7
2,381,289.2
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,381,289.2
0.0
0.0
0.0
0.0
3
Credit institutions
11,730,707.4
2,380,977.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,380,977.1
0.0
0.0
0.0
0.0
4
Loans and advances
11,210,991.0
2,152,301.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
2,152,301.9
0.0
0.0
0.0
0.0
5
Debt securities, including UoP
519,716.4
228,675.2
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
228,675.2
0.0
0.0
0.0
0.0
6
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
7 Other financial corporations 34,501.3 312.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 312.0 0.0 0.0 0.0 0.0
8
of which investment firms
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
9
Loans and advances
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
10
Debt securities, including UoP
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
11
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
12
of which management companies
2,178.7
21.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
21.1
0.0
0.0
0.0
0.0
13 Loans and advances 2,178.7 21.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 21.1 0.0 0.0 0.0 0.0
14 Debt securities, including UoP 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
15
Equity instruments
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
16
of which insurance undertakings
32,322.6
290.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
290.9
0.0
0.0
0.0
0.0
17
Loans and advances
32,322.6
290.9
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
290.9
0.0
0.0
0.0
0.0
18
Debt securities, including UoP
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
19 Equity instruments 0.0 0.0 0.0 , 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0,0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
216
Disclosure reference date T
PLN k
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
20 Non-financial undertakings 5,758,050.6 1,721,000.6
382,994.4
0.0 9,086.7 235,854.8 0.0 0.0 0.0 0.0 1,721,000.6 382,994.4 0.0 9,086.7 235,854.8
21 Loans and advances 5,758,050.6 1,721,000.6
382,994.4
0.0 9,086.7 235,854.8
0.0 0.0 0.0 0.0 1,721,000.6 382,994.4 0.0 9,086.7 235,854.8
22 Debt securities, including UoP 0.0 0.0
0.0
0.0 0.0 0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
23 Equity instruments 0.0 0.0
0.0
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
24 Households 52,109,718.1 52,109,718.1
744,255.9
0.0 0.0 0.0 0.0 0.0 0.0 0.0 52,109,718.1 744,255.9 0.0 0.0 0.0
25
of which loans collateralised by
residential immovable property
50,439,910.6 50,439,910.6 285,200.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 50,439,910.6 285,200.4 0.0 0.0 0.0
26
of which building renovation loans
743,558.1
743,558.1
459,055.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
743,558.1
459,055.5
0.0
0.0
0.0
27
of which motor vehicle loans
926,249.5
926,249.5
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
926,249.5
0.0
0.0
0.0
0.0
28 Local governments financing 105,180.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
29
Housing financing
12,849.7
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
30
Other local government financing
92,330.4
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
31
Collateral obtained by taking
possession: residential and
commercial immovable properties
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
32
Assets excluded from the numerator
for GAR calculation (covered in the
denominator)
20,206,931.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
33
Financial and Non-financial
undertakings
95,459,227.0
34
SMEs and NFCs (other than SMEs) not
subject to NFRD disclosure obligations
67,782,468,5
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
217
Disclosure reference date T
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
35
Loans and advances
67,713,917.9
36
of which loans collateralised by
commercial immovable property
0.0
37
of which building renovation loans
0.0
38
Debt securities, including UoP
23,259.6
39 Equity instruments
45,291.0
40 Financial undertakings 26,950,158.2
41
Non-EU country counterparties not
subject to NFRD disclosure
obligations
726,600.4
42
Loans and advances
710,910.5
43 Debt securities, including UoP
4,010.8
44 Equity instruments 11,679.0
45
Derivatives
1,575,056.3
46
On demand interbank loans
2,019,784.9
47
Cash and cash-related assets
8,417,519.1
48
Other categories of assets (e.g.
Goodwill, commodities etc.)
43,620,763.1
49
Total GAR assets
220,830,507.9
56,212,007.9
1,127,250.3
0.0
9,086.7
235,854.8
0.0
0.0
0.0
0.0
56,212,007.9
1,127,250.3
0.0
9,086.7
235,854.8
50
Assets not covered for GAR
calculation
62,799,747.2
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
218
Disclosure reference date T
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Total gross
carrying
amount
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which towards taxonomy relevant sectors
(Taxonomy-eligible)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which environmentally
sustainable (Taxonomy-aligned)
Of which environmentally sustainable (Taxonomy-
aligned)
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
Of which
Use of
Proceeds
Of which
enabling
Of which
Use of
Proceeds
Of which
transitional
Of which
enabling
51
Central governments and
Supranational issuers
47,503,665.5
52
Central banks exposure
6,246,368.2
53
Trading book
9,049,713.6
54
Total assets
283,630,255.1
Off-balance sheet exposures -
Undertakings subject to NFRD
disclosure obligations
55 Financial guarantees 22,196.6 188.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 188.1 0.0 0.0 0.0 0.0
56
Assets under management
19,188,939.2
1,112,753.1
128,714.8
0.0
12,968.7
115,746.1
228,162.7
70.6
0.0
70.6
1,340,915.8
128,785.4
0.0
12,968.7
115,816.7
57
Of which debt securities
15,530,809.5
683,442.1
63,402.2
0.0
6,964.8
56,437.5
149,502.5
61.7
0.0
61.7
832,944.5
63,463.9
0.0
6,964.8
56,499.1
58
Of which equity instruments
3,652,405.5
436,932.7
65,779.9
0.0
6,047.7
59,732.1
79,556.1
9.1
0.0
9.1
516,488.8
65,789.0
0.0
6,047.7
59,741.2
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
219
> GAR sector information by stock and turnover
Breakdown by sector - NACE 4 digits level (code
and label)
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Non-Financial corporates (Subject to
NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
[Gross] carrying amount
[Gross] carrying amount
[Gross] carrying amount
PLNk
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
1
B.07.29 Mining of other non-ferrous metal ores
68,411.82
0.0
0.0
0.0
68,411.82
0.0
2 C.11.02 Manufacture of wine from grape 1,040.97 0.0 0.0 0.0 1,040.97 0.0
3 C.17.12 Manufacture of paper and paperboard 79.31 0.0 0.0 0.0 79.31 0.0
4
C.19.20 Manufacture of refined petroleum products
25,485.81
0.0
0.0
0.0
25,485.81
0.0
5
C.20.15 Manufacture of fertilisers and nitrogen compound
287,998.62
0.0
0.0
0.0
287,998.62
0.0
6
C.20.16 Manufacture of plastics in primary forms
15.32
0.0
0.0
0.0
15.32
0.0
7
C.22.19 Manufacture of other rubber products
41.60
0.0
0.0
0.0
41.60
0.0
8 C.28.12 Manufacture of fluid power equipment 65.82 0.0 0.0 0.0 65.82 0.0
9
C.28.21 Manufacture of ovens, furnaces and furnace
burners
1,958.92
0.0
0.0 0.0
1,958.92
0.0
10
C.28.92 Manufacture of machinery for mining, quarrying
and construction
4,202.33
0.0
0.0 0.0
4,202.33
0.0
11
C.30.20 Manufacture of railway locomotives and rolling
stock
15.10
0.0
0.0
0.0
15.10
0.0
12
D 35.14 Trade of electricity
180,906.60
0.0
0.0
0.0
180,906.60
0.0
13
F.41.10 Development of building projects
34,643.92
0.0
0.0
0.0
34,643.92
0.0
14
G.45.31 Wholesale trade of motor vehicle parts and
accessories
102,115.23
0.0
0.0
0.0
102,115.23
0.0
15
G.46.32 Wholesale of meat and meat product
19,421.70
0.0
0.0
0.0
19,421.70
0.0
16
G.46.42 Wholesale of clothing and footwear
29,261.71
0.0
0.0
0.0
29,261.71
0.0
17 G.46.46 Wholesale of pharmaceutical goods 277.76 0.0 0.0 0.0 277.76 0.0
18
G.46.90 Non-specialised wholesale trade
37,056.51
0.0
0.0
0.0
37,056.51
0.0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
220
Breakdown by sector - NACE 4 digits level (code
and label)
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Non-Financial corporates (Subject to
NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
[Gross] carrying amount
[Gross] carrying amount
[Gross] carrying amount
PLNk
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
19
G.47.11 Retail sale in non-specialised stores with food,
beverages or tobacco predominating
2.21 0.0 0.0 0.0 2.21 0.0
21
G.47.41 Retail sale of computers, peripheral units and
software in specialised stores
10,324.14 0.0 0.0 0.0 10,324.14 0.0
21
G.47.71 Retail sale of clothing in specialised stores
20,733.01
0.0
0.0
0.0
20,733.01
0.0
22
G.47.72 Retail sale of footwear and leather goods in
specialised stores
25,887.39 0.0 0.0 0.0 25,887.39 0.0
23
J.58.13 Publishing of newspapers
3,379.56
0.0
0.0
0.0
3,379.56
0.0
24
J.61.10 Wired telecommunications activities
4,132.61
0.0
0.0
0.0
4,132.61
0.0
25
J.61.30 Satellite telecommunications activities
10,741.56
0.0
0.0
0.0
10,741.56
0.0
26 K.66.12 Security and commodity contracts brokerage 10,877.38 0.0 0.0 0.0 10,877.38 0.0
27
K.66.12 Security and commodity contracts brokerage
189.72
0.0
0.0
0.0
189.72
0.0
28
L.68.10 Buying and selling of own real estate
51,458.97
0.0
0.0
0.0
51,458.97
0.0
29
M.70.10 Activities of head offices
219,015.17
0.0
0.0
0.0
219,015.17
0.0
30
M.70.22 Business and other management consultancy
activities
17.35 0.0 0.0 0.0 17.35 0.0
31
N.77.40 Leasing of intellectual property and similar
products, except copyrighted works
1,673.64 0.0 0.0 0.0 1,673.64 0.0
32
N.82.91 Activities of collection agencies and credit
bureaus
2,180.96 0.0 0.0 0.0 2,180.96 0.0
33 R.93.11 Operation of sports facilities 9,481.70 0.0 0.0 0.0 9,481.70 0.0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
221
> GAR sector information by stock and CapEx
Breakdown by sector - NACE 4 digits level (code
and label)
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Non-Financial corporates (Subject to
NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
[Gross] carrying amount
[Gross] carrying amount
[Gross] carrying amount
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
1
B.07.29 Mining of other non-ferrous metal ores
68,411.8
0.0
0.0
0.0
68,411.8
0.0
2 C.11.02 Manufacture of wine from grape 1,041.0 0.0 0.0 0.0 1,041.0 0.0
3 C.17.12 Manufacture of paper and paperboard 79.3 0.0 0.0 0.0 79.3 0.0
4
C.19.20 Manufacture of refined petroleum products
25,485.8
0.0
0.0
0.0
25,485.8
0.0
5
C.20.15 Manufacture of fertilisers and nitrogen
compound
287,998.6
0.0
0.0
0.0
287,998.6
0.0
6
C.20.16 Manufacture of plastics in primary forms
15.3
0.0
0.0
0.0
15.3
0.0
7
C.22.19 Manufacture of other rubber products
41.6
0.0
0.0
0.0
41.6
0.0
8
C.28.12 Manufacture of fluid power equipment
65.8
0.0
0.0
0.0
65.8
0.0
9
C.28.21 Manufacture of ovens, furnaces and furnace
burners
1,958.9
0.0
0.0
0.0
1,958.9
0.0
10
C.28.92 Manufacture of machinery for mining, quarrying
and construction
4,202.3
0.0
0.0
0.0
4,202.3
0.0
11
C.30.20 Manufacture of railway locomotives and rolling
stock
15.1
0.0
0.0
0.0
15.1
0.0
12
D 35.14 Trade of electricity
180,906.6
0.0
0.0
0.0
180,906.6
0.0
13
F.41.10 Development of building projects
34,643.9
0.0
0.0
0.0
34,643.9
0.0
14
G.45.31 Wholesale trade of motor vehicle parts and
accessories
102,115.2
0.0
0.0
0.0
102,115.2
0.0
15
G.46.32 Wholesale of meat and meat product
19,421.7
0.0
0.0
0.0
19,421.7
0.0
16
G.46.42 Wholesale of clothing and footwear
29,261.7
0.0
0.0
0.0
29,261.7
0.0
17
G.46.46 Wholesale of pharmaceutical goods
277.8
0.0
0.0
0.0
277.8
0.0
18
G.46.90 Non-specialised wholesale trade
37,056.5
0.0
0.0
0.0
37,056.5
0.0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
222
Breakdown by sector - NACE 4 digits level (code
and label)
Climate Change Mitigation (CCM)
Climate Change Adaptation (CCA)
TOTAL (CCM + CCA)
Non-Financial corporates (Subject to
NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
Non-Financial corporates
(Subject to NFRD)
SMEs and other NFC not
subject to NFRD
[Gross] carrying amount
[Gross] carrying amount
[Gross] carrying amount
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCM)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
PLN
Of which
environmentally
sustainable
(CCM + CCA)
19
G.47.11 Retail sale in non-specialised stores with food,
beverages or tobacco predominating
2.2
0.0
0.0
0.0
2.2
0.0
21
G.47.41 Retail sale of computers, peripheral units and
software in specialised stores
10,324.1
0.0
0.0
0.0
10,324.1
0.0
21
G.47.71 Retail sale of clothing in specialised stores
20,733.0
0.0
0.0
0.0
20,733.0
0.0
22
G.47.72 Retail sale of footwear and leather goods in
specialised stores
25,887.4
0.0
0.0
0.0
25,887.4
0.0
23
J.58.13 Publishing of newspapers
3,379.6
0.0
0.0
0.0
3,379.6
0.0
24
J.61.10 Wired telecommunications activities
4,132.6
0.0
0.0
0.0
4,132.6
0.0
25
J.61.30 Satellite telecommunications activities
10,741.6
0.0
0.0
0.0
10,741.6
0.0
26
K.66.12 Security and commodity contracts brokerage
10,877.4
0.0
0.0
0.0
10,877.4
0.0
27 K.66.12 Security and commodity contracts brokerage 189.7 0.0 0.0 0.0 189.7 0.0
28
L.68.10 Buying and selling of own real estate
51,459.0
0.0
0.0
0.0
51,459.0
0.0
29
M.70.10 Activities of head offices
219,015.2
0.0
0.0
0.0
219,015.2
0.0
30
M.70.22 Business and other management consultancy
activities
17.3
0.0
0.0
0.0
17.3
0.0
31
N.77.40 Leasing of intellectual property and similar
products, except copyrighted works
1,673.6
0.0
0.0
0.0
1,673.6
0.0
32
N.82.91 Activities of collection agencies and credit
bureaus
2,181.0
0.0
0.0
0.0
2,181.0
0.0
33 R.93.11 Operation of sports facilities 9,481.7 0.0 0.0 0.0 9,481.7 0.0
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
223
> GAR KPI stock by turnover
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Łagodzenie zmian klimatu (CCM) Adaptacja do zmian klimatu (CCA) OGÓŁEM
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
79% 1% 0% 0% 0% 0% 0% 0% 0% 79% 1% 0% 0% 0% 25%
2
Financial undertakings
21%
0%
0%
0%
0%
0%
0%
0%
0%
21%
0%
0%
0%
0%
4%
3
Credit institutions
21%
0%
0%
0%
0%
0%
0%
0%
0%
21%
0%
0%
0%
0%
4%
4
Loans and advances
20%
0%
0%
0%
0%
0%
0%
0%
0%
20%
0%
0%
0%
0%
4%
5
Debt securities, including UoP
44%
0%
0%
0%
0%
0%
0%
0%
0%
44%
0%
0%
0%
0%
0%
6
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
7 Other financial corporations 1% 0% 0% 0% 0% 0% 0% 0% 0% 1% 0% 0% 0% 0% 0%
8
of which investment firms
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
9
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
10
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
11
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
12
of which management companies
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
13 Loans and advances 1% 0% 0% 0% 0% 0% 0% 0% 0% 1% 0% 0% 0% 0% 0%
14
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
15
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
16
of which insurance undertakings
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
224
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
17
Loans and advances
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
18
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
19
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
20
Non-financial undertakings
14%
1%
0%
0%
1%
0%
0%
0%
0%
14%
1%
0%
0%
1%
2%
21
Loans and advances
14%
1%
0%
0%
1%
0%
0%
0%
0%
14%
1%
0%
0%
1%
2%
22 Debt securities, including UoP 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
23
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
24
Households
100%
1%
0%
0%
0%
0%
0%
0%
0%
100%
1%
0%
0%
0%
18%
25
of which loans collateralised by
residential immovable property
100% 1% 0% 0% 0% 0% 0% 0% 0% 100% 1% 0% 0% 0% 18%
26
of which building renovation loans
100%
62%
0%
0%
0%
0%
0%
0%
0%
100%
62%
0%
0%
0%
0%
27
of which motor vehicle loans
100%
0%
0%
0%
0%
100%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
225
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
28
Local governments financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
29
Housing financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
30
Other local government financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
31
Collateral obtained by taking
possession: residential and
commercial immovable
properties
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
32
Assets excluded from the
numerator for GAR calculation
(covered in the denominator)
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
226
> GAR KPI stock by CapEx
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Łagodzenie zmian klimatu (CCM) Adaptacja do zmian klimatu (CCA) OGÓŁEM
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both
numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
81% 2% 0% 0% 0% 0% 0% 0% 0% 81% 2% 0% 0% 0% 25%
2
Financial undertakings
20%
0%
0%
0%
0%
0%
0%
0%
0%
20%
0%
0%
0%
0%
4%
3
Credit institutions
20%
0%
0%
0%
0%
0%
0%
0%
0%
20%
0%
0%
0%
0%
4%
4
Loans and advances
19%
0%
0%
0%
0%
0%
0%
0%
0%
19%
0%
0%
0%
0%
4%
5
Debt securities, including UoP
44%
0%
0%
0%
0%
0%
0%
0%
0%
44%
0%
0%
0%
0%
0%
6
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
7
Other financial corporations
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
8 of which investment firms 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
9 Loans and advances 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
10
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
11
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
12
of which management companies
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
13
Loans and advances
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
14
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
15 Equity instruments 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
16
of which insurance undertakings
1%
0%
0%
0%
0%
0%
0%
0%
0%
1%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
227
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
17 Loans and advances 1% 0% 0% 0% 0% 0% 0% 0% 0% 1% 0% 0% 0% 0% 0%
18
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
19
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
20
Non-financial undertakings
30%
7%
0%
0%
4%
0%
0%
0%
0%
30%
7%
0%
0%
4%
2%
21
Loans and advances
30%
7%
0%
0%
4%
0%
0%
0%
0%
30%
7%
0%
0%
4%
2%
22
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
23 Equity instruments 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
24
Households
100%
1%
0%
0%
0%
0%
0%
0%
0%
100%
1%
0%
0%
0%
18%
25
of which loans collateralised by
residential immovable property
100% 1% 0% 0% 0% 0% 0% 0% 0% 100% 1% 0% 0% 0% 18%
26
of which building renovation loans
100%
62%
0%
0%
0%
0%
0%
0%
0%
100%
62%
0%
0%
0%
0%
27
of which motor vehicle loans
100%
0%
0%
0%
0%
100%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
228
Disclosure reference date T
% (compared to total covered
assets in the denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
28
Local governments financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
29 Housing financing 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
30
Other local government financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
31
Collateral obtained by taking
possession: residential and
commercial immovable
properties
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
32
Assets excluded from the
numerator for GAR calculation
(covered in the denominator)
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
229
> GAR KPI flow by turnover
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Łagodzenie zmian klimatu (CCM) Adaptacja do zmian klimatu (CCA) OGÓŁEM
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both
numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
14% 0% 0% 0% 0% 0% 0% 0% 0% 14% 0% 0% 0% 0% 26%
2
Financial undertakings
14%
0%
0%
0%
0%
0%
0%
0%
0%
14%
0%
0%
0%
0%
16%
3
Credit institutions
14%
0%
0%
0%
0%
0%
0%
0%
0%
14%
0%
0%
0%
0%
16%
4
Loans and advances
44%
0%
0%
0%
0%
0%
0%
0%
0%
44%
0%
0%
0%
0%
16%
5
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
6
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
7
Other financial corporations
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
8 of which investment firms 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
9 Loans and advances 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
10
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
11
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
12
of which management companies
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
13
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
14
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
15 Equity instruments 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
16
of which insurance undertakings
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
230
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
17
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
18
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
19
Equity instruments
27%
3%
0%
3%
0%
0%
0%
27%
3%
0%
3%
0%
20
Non-financial undertakings
27% 3% 0% 0% 3% 0% 0% 0% 0% 27% 3% 0% 0% 3% 1%
21
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
1%
22
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
23
Equity instruments
100%
4%
0%
0%
0%
0%
0%
100%
4%
0%
0%
0%
24
Households
100%
1%
0%
0%
0%
0%
0%
0%
0%
100%
1%
0%
0%
0%
8%
25
of which loans collateralised by
residential immovable property
100% 96% 0% 0% 0% 0% 0% 0% 0% 100% 96% 0% 0% 0% 7%
26
of which building renovation loans
100%
0%
0%
0%
0%
0%
0%
0%
0%
100%
0%
0%
0%
0%
0%
27
of which motor vehicle loans
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
1%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
231
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
28
Local governments financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
29 Housing financing 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
30
Other local government financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
31
Collateral obtained by taking
possession: residential and
commercial immovable
properties
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
32
Assets excluded from the
numerator for GAR calculation
(covered in the denominator)
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
232
> GAR KPI flow by CapEx
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Łagodzenie zmian klimatu (CCM) Adaptacja do zmian klimatu (CCA) OGÓŁEM
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
GAR - Covered assets in both
numerator and denominator
1
Loans and advances, debt securities
and equity instruments not HfT
eligible for GAR calculation
45% 2% 0% 0% 1% 0% 0% 0% 0% 45% 2% 0% 0% 1% 85%
2
Financial undertakings
16%
0%
0%
0%
0%
0%
0%
0%
0%
16%
0%
0%
0%
0%
53%
3
Credit institutions
16%
0%
0%
0%
0%
0%
0%
0%
0%
16%
0%
0%
0%
0%
53%
4
Loans and advances
14%
0%
0%
0%
0%
0%
0%
0%
0%
14%
0%
0%
0%
0%
52%
5
Debt securities, including UoP
223%
0%
0%
0%
0%
0%
0%
0%
0%
223%
0%
0%
0%
0%
1%
6
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
7
Other financial corporations
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
8 of which investment firms 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
9 Loans and advances 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
10
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
11
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
12
of which management companies
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
13
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
14
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
15 Equity instruments 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
16
of which insurance undertakings
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
233
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
17
Loans and advances
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
18
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
19
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
20
Non-financial undertakings
48% 14% 0% 0% 9% 0% 0% 0% 0% 48% 14% 0% 0% 9% 5%
21
Loans and advances
48%
14%
0%
0%
9%
0%
0%
0%
0%
48%
14%
0%
0%
9%
5%
22
Debt securities, including UoP
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
23
Equity instruments
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
24
Households
100%
4%
0%
0%
0%
0%
0%
0%
0%
100%
4%
0%
0%
0%
28%
25
of which loans collateralised by
residential immovable property
100% 1% 0% 0% 0% 0% 0% 0% 0% 100% 1% 0% 0% 0% 23%
26
of which building renovation loans
100%
96%
0%
0%
0%
0%
0%
0%
0%
100%
96%
0%
0%
0%
1%
27
of which motor vehicle loans
100%
0%
0%
0%
0%
100%
0%
0%
0%
0%
4%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
234
Disclosure reference date T
% (compared to total
covered assets in the
denominator)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych
dla systematyki (kwalifikujące się do systematyki)
Udział procentowy uwzględnionych aktywów ogółem
przeznaczonych na finansowanie sektorów istotnych dla
systematyki (kwalifikujące się do systematyki)
Proportion of
total assets
covered
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
28
Local governments financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
29 Housing financing 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
30
Other local government financing
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
31
Collateral obtained by taking
possession: residential and
commercial immovable
properties
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
32
Assets excluded from the
numerator for GAR calculation
(covered in the denominator)
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Management Board Report on Santander Bank Polska Group Performance in 2023
(including the Management Board Report on Santander Bank Polska S.A. Performance)
235
> KPI off-balance sheet exposures
Disclosure reference date T
% (compared to total
eligible off-balance sheet
assets)
Climate Change Mitigation (CCM) Climate Change Adaptation (CCA) TOTAL (CCM + CCA)
Proportion of total covered assets funding taxonomy relevant
sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-
eligible)
Proportion of total covered assets funding taxonomy
relevant sectors (Taxonomy-aligned)
Proportion of total covered assets funding
taxonomy relevant sectors (Taxonomy-
aligned)
Proportion of total covered assets funding taxonomy relevant sectors
(Taxonomy-aligned)
Of which Use
of Proceeds
Of which
transitional
Of which
enabling
Of which Use
of Proceeds
Of which
enabling
Of which Use of
Proceeds
Of which
transitional
Of which enabling
1
Financial guarantees
(FinGuar KPI)
0.85% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.85% 0.00% 0.00% 0.00% 0.00%
2
Assets under management
(AuM KPI)
5.80% 0.67% 0.00% 0.07% 0.60% 1.19% 0.00% 0.00% 0.00% 6.99% 0.67% 0.00% 0.07% 0.60%
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Rules for Taxonomy analysis for the purpose of GAR reporting for 2023
Identification of customers subject to the NFRD and general rules
The list of the Group’s customers subject to non-financial reporting obligations (in accordance with the criteria laid down in Article 19a and 29a of Directive
2013/34/EU on the annual financial statements, consolidated financial statements and related reports and Non-Financial Reporting Directive 214/95/EU)
was defined using the databases of third parties, particularly BIK (domestic entities) and Clarity (EU entities based outside Poland).
In the case of general purpose debt instruments, the value of Taxonomy-eligible and Taxonomy-aligned assets was calculated as a product of the gross
value of exposures and relevant turnover and CapEx KPIs. These indicators were provided by third parties, i.e. BIK (in terms of domestic entities) and
Clarity (in terms of non-residents). They come from the publicly available statements of non-financial information published by entities subject to NFRD.
In the case of specific purpose loans and advances and instruments issued to finance specific investments, the economic activities financed by the Group
were assessed on a case-by-case basis in terms of Taxonomy eligibility, i.e. if they were included in the EU Taxonomy as part of individual climate
objectives. If the result of the assessment was positive, they were subsequently analysed in terms of Taxonomy alignment, i.e. if they met the technical
criteria (contribute substantially to one climate objective and cause no significant harm to other environmental objectives) and minimum social
safeguards (meet specific social and ethical standards).
The methodology, analysis and results of both stages of the Taxonomy assessment were reviewed and approved by the ESG Panel. The Panel reviews
the transactions made by business units of Santander Bank Polska Group (excluding Santander Consumer Bank Group) and decides if they meet the
criteria of the EU Taxonomy, internal sustainable finance classification system (SFCS) and transition finance classification system (TFCS). Entities of
Santander Consumer Bank Group collect data and conduct Taxonomy analyses independently. The final templates are aggregated at the level of
Santander Bank Polska S.A. as a parent entity.
Assessment of Taxonomy eligibility of exposures to customers subject to the NFRD
Transactions with credit institutions and other financial institutions (understood exclusively as insurance companies, investment firms and asset
managers) gave rise to general purpose exposures and qualified as Taxonomy-eligible to the extent indicated by the KPIs published by the above-
mentioned customers. Exposures to financial institutions were not assessed in terms of Taxonomy alignment because of the transition period effective
until the end of 2023, during which those entities were only required to publish the eligibility ratio.
In the Corporate and Investment Banking Division, expert judgment was used to assess Taxonomy eligibility of specific purpose exposures to corporate
customers subject to the NFRD arising from term/investment loans, syndicated loans, trade finance and project finance.
In the Business and Corporate Banking Division, Taxonomy-eligible debt instruments were identified either on the basis of expert judgment (in the case
of older exposures) or digitalised results of the questionnaire obligatorily completed by customers subject to the NFRD applying for special purpose loans
as part of the regular classification of loans based on the EU Taxonomy and the internal sustainable finance classification system (in the case of new
exposures).
The eligibility of leasing transactions with customers subject to the NFRD was assessed on the basis of the leased assets.
As a result of the review and verification of the transactions from the Group’s debt instrument portfolio (both Business and Corporate Banking and
Corporate and Investment Banking) in terms of the type of the financed activity and its inclusion in the EU Taxonomy, the following activities were
classified as Taxonomy-eligible in accordance with Commission Delegated Regulation (EU) 2021/2139 establishing the technical screening criteria for
determining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation and for determining
whether that economic activity causes no significant harm to any of the other environmental objectives.
Assessment of Taxonomy alignment of exposures to customers subject to the NFRD
Transactions classified by the ESG Panel of Santander Bank Polska S.A. as sustainable finance in line with the internal sustainable finance classification
system (SFCS) were thoroughly reviewed in terms of their alignment with the EU Taxonomy.
In 2023, the assessment covered specific purpose lending in the form of project finance originated by the Corporate and Investment Banking Division not
disbursed earlier than in 2022. Based on the information collected, one transaction with an SPV of a customer subject to the NFRD was identified.
Both the customer and Santander Bank Polska Group are still conducting the assessment and collecting evidence for the purpose of Taxonomy
disclosures. As part of the transaction, a loan of PLN 251m was granted, of which PLN 26.7m was disbursed as at 31 December 2023. The activity subject
to assessment is electricity generation from wind power, which contributes to climate change mitigation.
In the Business and Corporate Banking segment, one potential Taxonomy-aligned specific purpose transaction with a customer subject to the NFRD was
identified. Lending is to be disbursed next year. The Taxonomy assessment is in progress. As a result, no transaction from the Business and Corporate
Banking segment was included for further analysis.
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Assessment of Taxonomy eligibility and Taxonomy alignment of exposures to households
Santander Bank Polska Group identified the following products for households as Taxonomy-eligible: home loans and loans for biomass-fuelled heating
devices, electric car charging stations, solar collectors, photovoltaic panels/installations, heat pumps, wind turbines, passenger cars and delivery vans up
to 3.5t granted on or after 1 January 2022.
The following facilities were classified as Taxonomy-aligned: loans for electric car charging stations, solar collectors and photovoltaic panels/installations
which do not cause significant harm to objectives related to climate change adaptation. The assessment was made on the basis of customers’ postal
codes and the database prepared by Munich Re, including information about the severity and frequency of climate threats in NUTS territorial units in
Poland.
The Taxonomy-aligned products also included home loans of Santander Bank Polska S.A. (excluding the portfolio of Santander Consumer Bank S.A. as
those loans were withdrawn from the offer in 2009) that met the criterion of substantial contribution based on the analysis of data included in the central
register of energy performance certificates (issued in Poland since 2015) and the “do no significant harm” criterion with regard to climate change
adaptation.
As it was not possible to automatically separate mortgage loans for development of new buildings or loans for purchase of residential properties, such
loans are presented at an aggregate level as part of the portfolio secured by residential properties. In order to assess if the above portfolio contributes
substantially to climate change mitigation, a more stringent criterion was used, i.e. the criterion applicable to buildings constructed after 31 December
2020, according to which the primary energy demand should be at least 10% lower than the threshold set for nearly zero-energy buildings in the domestic
legislation implementing Directive 2010/31/EU of the European Parliament and of the Council. To that end, the ratio showing the annual demand for
non-renewable primary energy for space and water heating, ventilation and cooling was compared with the threshold value reduced by 10% (calculated
in line with the formula presented in § 329(1) of the Notice of the Minister for Development and Technology of 15 April 2022): 63kWh/(sqm*year) for
single-family residential buildings and 58.5 kWh/(sqm*year) for multi-family residential buildings.
The physical risks of the portfolio of loans secured by residential properties were assessed on the basis of customers’ postal codes and the database of
NUTS territorial units in Poland including information about climate threats of high severity or frequency on a given territory.
Due to insufficient evidence resulting from disproportionate efforts and resources required to obtain relevant information and confirmations from
customers for the purpose of reporting for 2023, loans for electric and plug-in hybrid cars and loans for biomass-fuelled heating devices were not
classified as Taxonomy-aligned.
Local governments
The Group did not grant loans to local governments to finance residential or commercial properties. No other specific purpose lending was sanctioned to
that group either.
Voluntary disclosures
Information about transactions with special purpose vehicles
Lending granted to customers subject to the NFRD is not the only significant financing provided by the Bank that contributes to environmental objectives.
As part of specific purpose lending in the form of project finance originated by the Corporate and Investment Banking Division and disbursed not earlier
than in 2022, which was classified by the ESG Panel of Santander Bank Polska S.A. as sustainable finance according to the internal classification system,
five transactions with SPVs of customers not subject to the NFRD were identified. They were thoroughly analysed in terms of Taxonomy alignment.
Three transactions were classified as Taxonomy-aligned. Their total nominal value is PLN 400m, of which PLN 277m was disbursed as at 31 December
2023. The above projects substantially contribute to climate change mitigation through electricity generation from wind power. The projects meet the
technical criteria and the “do no significant harm” rule, and project sponsors comply with minimum safeguards.
Each location specified in the project documentation was verified in terms of physical risks. No such risks were identified using tools available to the Bank.
As the project documentation did not include information about a potential negative impact on the transition to a circular economy, the parameters of
wind turbines used in the projects and their suppliers were analysed in greater detail. The analysis covered availability, durability, recyclability, easy
disassembly and adaptability of products manufactured. The impact on the protection and recovery of biodiversity and ecosystems was analysed too.
The assessment focused on the environmental impact and effectiveness of implementation of the required mitigation and compensation measures. The
projects classified by Santander Bank Polska S.A. as Taxonomy-aligned do not adversely affect the protection and recovery of biodiversity and ecosystems.
The environmental and social analysis was conducted in line with the Equator Principles, which are an official project assessment methodology adopted
by the Bank. Each majority investor was verified in terms of compliance with minimum safeguards. Specifically, the Bank checked if they had rules or due
diligence processes in place regarding human rights, good tax practices, fair competition and prevention of corruption, and if all employees and suppliers
were required to adhere to them. Investors in projects classified by Santander Bank Polska S.A. as Taxonomy-aligned comply with minimum safeguards.
The other two transactions did not qualify as Taxonomy-aligned as there was insufficient evidence to demonstrate the compliance with the “do no
significant harm” criterion. However, they meet some or all criteria of substantial contribution to the environmental objectives of the Taxonomy.
The purpose of one of these transactions was to finance the renovation of an existing building, reducing the primary energy demand by at least 30%
(according to SPO). PLN 186m worth of lending was provided, of which PLN 79m was disbursed as at 31 December 2023. Due to incomplete
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documentation, it was not possible to confirm that other technical criteria and the “do no significant harm” rule were met. Still, the transaction qualifies
as sustainable finance according to the internal classification system.
The purpose of the other transaction was to finance the construction of photovoltaic infrastructure. PLN 225m worth of lending was granted, of which
PLN 150m was disbursed as at 31 December 2023. The transaction was classified by the ESG Panel as sustainable finance according to the internal
classification system but did not qualify as Taxonomy-aligned. The results of the Taxonomy analysis were not sufficient to demonstrate compliance with
the “do no significant harm” rule (transition to a circular economy). The project documentation included information about at least six suppliers of solar
panels, which limited the possibility to confirm availability, durability, recyclability, easy disassembly and adaptability of products manufactured.
Specific purpose lending granted by the Business and Corporate Banking and reviewed by the ESG Panel in terms of alignment with the internal
classification system (SFCS) concerned the development and purchase of commercial properties. The assessment was based on the BREEAM and LEEDS
(pre)certification, which is not sufficient to determine the alignment with the EU Taxonomy. It was concluded that the Group did not have sufficient
evidence to consider those transactions to be Taxonomy-aligned. As a result, no transaction from the Business and Corporate Banking segment was
classified as such.
Other qualitative disclosures related to EU Taxonomy
Nature and objectives of Taxonomy-aligned economic activities and the evolution of the Taxonomy-aligned economic
activities over time
The Bank takes steps to align its portfolio with the goals set in the Paris Agreement, the TCFD's recommendations and the EU policies, which indicate
that the financial sector plays a major role in tackling climate change. The value of lending granted by the Bank for sustainable purposes has been steadily
rising. Such purposes include renewable energy sources, energy-efficient buildings and electromobility. The Bank also intends to increase the financing
of energy storage facilities and hydrogen installations.
-The Bank analyses requirements arising from the EU Taxonomy-related regulations. It is aware of challenges connected with the robust criteria for
assessing different types of economic activities and the availability of the underlying data. That is why the Bank keeps improving its reporting systems
and processes. Work is underway to create an analytical database which will be used as a uniform data source for reporting purposes. The Bank also
obtains data from its customers and other external sources to make sure that its data repository is as accurate and complete as possible. As a result of
an analysis, the Bank identified assets and activities which currently cannot be classified as Taxonomy-aligned due to insufficient data. Specifically, there
are no consistent rules or sufficient evidence to assess the “do no significant harm” criteria and the minimum social safeguards. The assessment of the
Taxonomy alignment of different types of economic activities may change in the future, once more data are available and a common sector approach is
adopted.
Compliance with Regulation (EU) 2020/852 in the financial undertaking’s business strategy, product design processes
and engagement with clients and counterparties
The Bank considers the environmental objectives specified in the EU Taxonomy in its sustainable development initiatives and integrates the ESG criteria
into the credit analysis of its customers. The Bank follows a climate strategy which complies with the Net Zero global strategy of Banco Santander and
supports customers in their transition to a low carbon economy. Specifically, it provides advisory services and steadily expands the range of products
supporting the transition (including debt instruments).
For 2024–2026, the Bank’s Management Board adopted the “We Help You Achieve More” strategy. It emphasises that the challenges the Bank and the
society face require a huge responsibility. With a sustainable business model, the Bank creates value for customers, employees, shareholders and local
communities, working towards a better future for us, our children and our planet. This is what the Bank’s third strategic direction – Total Responsibility
– is about. The strategy includes the Bank’s commitment to comply with the reporting requirements regarding ESG (including the EU Taxonomy) and
diversify the portfolio of green assets. Therefore, in 2024–2026 the Bank will launch new financial products and services to support the transition, provide
advisory services in terms of green investments, finance new sustainable projects and communicate with investors to ensure that green assets generated
by the Bank meet their expectations.
Additional or complementary information in support of the financial undertaking’s strategies and the weight of the
financing of Taxonomy-aligned economic activities in their overall activity
Apart from the assessment of its exposures in terms of alignment with the EU Taxonomy, in 2022 the Bank implemented the internal Sustainable Finance
Classification System (SFCS). It specifies the criteria to be met by specific and general purpose lending to be classified as green, social or sustainable
finance. The system is based on the recognised market standards, including the EU Taxonomy. Other guidelines that the system complies with are: ICMA
Social and Green Bond Principles, Climate Bond Standards and LMA Sustainability Linked Loan Principles. Based on the EU Taxonomy, the Bank identifies
environmentally sustainable finance (GAR), which is part of the finance that meets the SFCS criteria. In 2023, the value of the latter finance was PLN
7,671m (PLN 3,127.5m in 2022) and increased by 145% YoY, reflecting a dynamic growth of the Bank’s investments in sustainable projects. As the GAR
is published for the first time, its YoY evolution can be presented in the future reporting periods.
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Environmental impact of operations
Greenhouse gas emissions
Since 2020, we have been neutral in terms of our own CO2 emissions. We only buy energy from renewable sources and emissions are offset by so-called
carbon credits. These are purchased for all subsidiaries by the Banco Santander Group. In 2023, our direction was set by the Responsible Banking and
Sustainability Policy. We are also implementing the Global Net Zero Strategy, reducing greenhouse gas emissions from internal activities such as
electricity consumption, business travel or car fleet operations. Since 2022, our offices have been powered by RES electricity under a grid contract with
Tauron, as evidenced by the ECO Premium product accession certificate. The electricity we buy participates entirely in the Green Energy Sales Guarantee
scheme and comes from green energy sources - mainly hydroelectric power plants. In addition, we are focusing on increasing energy efficiency in our
own operations. In 2022, electricity consumption in the bank’s offices fell by 19.6% and we reduced natural gas consumption for central heating and hot
water by a quarter (compared to 2021).
The bank calculates its greenhouse gas emissions. In 2023, for the first time we included in the calculations data of subsidiary companies from the
Santander Bank Polska’s capital group. As at the date of publication of the Management Board's Report, the data was under attestation; therefore,
information on emissions and their constituent data will be published in the Bank’s 2023 ESG Report.
Other environmental indicators
> Water consumption
At all our Group’s locations, we use tap water for drinking and sanitary purposes and then discharge it into the municipal sewerage networks.
> Consumption of materials at the bank by weight and volume
Santander Bank Polska S.A.
Santander Bank Polska Group
Magnetic data storage media [kg]
2,213.00
2,550.64
Paper [kg]
137,628.75
148,007.25
Total [kg]
139,841.75
150,557.89
5. Anti-corruption policies and their outcomes
Ethics
The Group’s key document in place since 2018, which describes ethical standards, is the publicly available General Code of Conduct. It defines the detailed
principles of work ethics in our organisation, presents examples of desirable behaviour in specific situations and clearly communicates the consequences
of violating ethical standards. The Code’s standards are applicable to all our workers under employment contracts or civil law contracts, including top
management and members of management and supervisory bodies.
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> Selected aspects addressed by the Code:
organisational culture - the „Santander Way” and the
TEAMS values,
equal opportunities and non-discrimination,
inclusive and respectful working environment,
prevention of conflicts of interest,
handling confidential information and personal data,
behaviour in the media and during public appearances,
procedures for conduct in the securities markets,
maintaining fair and responsible relationships with
competitors,
cyber security,
responsible use of social media,
reliability and transparency of financial information,
control of employee expenses,
respect for intellectual and industrial property rights,
sales of banking products and services,
relations with suppliers and intermediaries,
gifts and invitations from third parties,
prevention of financial crime,
cooperation with public authorities.
The Code also sets out the responsibilities of the various units for the implementation of ethical principles, including those of the management of the
Compliance function, the Santander Group Regulatory Compliance Committee, Internal Audit, the Audit and Compliance Committee, the Supervisory
Board, the Human Resources Management Unit and the Business Ethics Council.
The Code is subject to annual reviews. In 2023, changes were made to the provisions on TEAMS corporate behaviours, among others.
The provisions of the Code are complemented by the following Group internal documents:
Code of Conduct on Securities Markets,
Anti-Money Laundering Policy,
Anti-Bribery and Corruption (ABC) Policy,
Conflict of Interest Policy,
Whistleblowing Policy,
“Respect and Dignity” Policy.
One of the areas regulated in the Code and further elaborated in the Whistleblowing Policy is the issue of reporting violations of the law and corporate
standards. Employees can report misconduct, also anonymously, using the following channels:
KLAKSON application,
ethical helpline,
a dedicated email box,
letters sent by post to the address indicated in the internal regulations.
All channels are operated internally. Only in certain situations may the submitted reports be forwarded to an external expert for examination. All
information sent, including the identity of the whistleblower, is treated as confidential. The whistleblower can choose whether to report the case giving
their name or remaining anonymous. Once the information gathered has been clarified and validated, disciplinary or other action may be taken against
the persons concerned. Whistleblowers may not be subject to reprisal or any other sanctions for whistleblowing in accordance with the Group’s internal
regulations. The Group also applies the good industry practices compiled in the “Code of Banking Ethics”, developed by the Polish Bank Association (ZBP).
In 2022, we received 143 reports via whistleblowing channels
(including the ethical mailbox, the app and the helpline).
At Santander Bank Polska S.A., the Chief Compliance Officer, acting under the authority of the Bank’s CEO, is responsible for the functioning of the
whistleblowing procedures, and designated employees of the Compliance Area are authorised to receive reports and take follow-up action. The rules on
whistleblowing contained in the General Code of Conduct are reflected in the internal regulations of the Group entities.
The whistleblowing channels indicated above are dedicated to persons employed by the Bank under an employment or civil law contract, including top
management and members of the Bank’s management and supervisory bodies. These channels are also used by persons in equivalent roles in subsidiary
companies (Santander Factoring sp. z o.o., Santander Leasing S.A., Santander Towarzystwo Funduszy Inwestycyjnych S.A.). At Santander Factoring sp. z
o. o. the Whistleblowing Policy based on the regulations of Santander Bank Polska S.A. takes into account the specific nature and organisational structure
of the company. Among other things, special forms and applications have been implemented to enable open reporting of violations of applicable
regulations and suspicious customer behaviour that may result in committing a criminal offence (so-called antifraud).
At Santander Leasing S.A., reports sent through whistleblowing channels made available by the Bank are dealt with by special units of the Bank with the
participation of Santander Leasing S.A. Complaints submitted by customers directly to the company are handled by its business units. Santander Leasing
S.A. also maintains records of breaches of regulations and incidents that threaten the company’s reputation.
At Santander TFI S.A. The Internal Audit and Compliance Department is authorised to receive reports of violations, take follow-up action and manage the
functioning of the anonymous reporting procedures.
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Santander Consumer Bank S.A. also has channels in place for reporting violations of the law, internal regulations and ethical rules. These include
mailboxes and the external Sygnanet application. Violations can be reported there by current and former employees, job candidates, trainees and interns,
members of Santander Consumer Bank’s governing bodies and suppliers. The responsibility for receiving reports lies (depending on the reporting channel)
with either the Bank’s Chief Executive Officer and designated employees of the Compliance Department or the Supervisory Board or designated members
of the Supervisory Board.
Conflicts of Interest
The conflict of interest policies in place in the Santander Bank Polska Group are based on the regulations implemented in the parent company. The
Conflicts of Interest Policy of Santander Bank Polska S.A. details the relevant provisions of the General Code of Conduct and requires all employees to
give priority to the interests of the Group, customers and other stakeholders, which they may under no circumstances subordinate to their private
interests. According to the Code, employees and management are subject to the following obligations:
prohibition of special treatment or offering special terms of employment due to personal or family ties,
prohibition on deriving additional benefits from a position held in the Group, except in explicitly permissible cases,
prohibition from participating in the approval of transactions or influencing transactions with parties associated by economic or family ties acting
as beneficiaries or guarantors.
The Conflicts of Interest Policy of Santander Bank Polska S.A. also addresses cases of conflict of interest:
between clients,
between the Bank and its customers,
arising from the relationship between the subsidiary and the bank acting as the parent company,
between Group entities and members of their management bodies,
with significant shareholders of subsidiaries,
between the bank and its suppliers, third parties or key business partners,
between the bank’s functions and/or business units,
between two subsidiaries.
between members of the Bank’s Supervisory Board or Management Board, or between members of these bodies and other employees (arising,
among other things, from non-business relationships, kinship or affinity),
between the Bank and related parties other than the ones mentioned above.
At Santander Bank Polska S.A., potential conflicts of interest are assessed by experts from the Compliance Area. They have the right to request certain
data or information about personal or professional circumstances that may affect the performance of employees’ duties and the decisions made. The
Policy applies to the Bank and is a reference document to be followed by other units in their activities related to the subject matter. Group companies are
required to use this document as the basis for all the policies, procedures and regulations they develop and implement in the areas concerned, making
any changes required to bring its provisions into line with local rules, recommendations and instructions issued by supervisory authorities.
Prevention of corruption
Anti-corruption matters are outlined in the Group-wide General Code of Conduct, originally supplemented by the Anti-Corruption Programme, which was
replaced in December 2023 by the Anti-Bribery and Corruption (ABC) Policy, which provides an update on, among others, anti-bribery and corruption
training issues. All of our Group companies operate according to the “zero tolerance for corruption” principle, and the regulations in force govern, among
other things:
gifts and invitations given to public officials,
gifts and invitations given to employees,
relations with third parties,
application of additional control mechanisms,
whistleblowing channels.
In 2023, the Group did not record a single case of corruption, no any legal proceedings for corrupt practices against companies or their employees.
Our anti-corruption policies as well as our approach to this issue are known to all Group employees and to members of the governing bodies. In addition
to informing about the procedures as part of the standard process of internal regulation communication, we also provide anti-corruption training. In
2023, e-learning was available for employees on topics related to:
General Code of Conduct,
Anti-corruption program / Anti-Bribery and Corruption (ABC) Policy,
Guidelines concerning gifts and invitations,
Corporate Defence.
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Number of employees
by employment
category
Number of employees
to whom anti-
corruption policies and
procedures have been
communicated
% of employees to
whom anti-corruption
policies and procedures
have been
communicated
Number of employees
who have received
anti-corruption training
% of employees who
have received anti-
corruption training
Group (including the
Bank)
12,072 11,799 97.74% 11,677 96.73%
Members of the
Bank’s Management
Board
11 11 100% 11 100%
Members of the
Bank’s senior
management
64 64 100% 63 98%
Members of the
Bank’s middle
management
1,369 1,369 100% 1,357 99%
Other employees of
the Bank
8,602 8,602 100% 8,495 99%
Total
10,046
10,046
100%
9,926
99%
* Employees excluding members of the Management Board and middle management of Santander Bank Polska S.A.
** Other managers of Santander Bank Polska S.A.
*** Employees on long-term leave of absence are not included
> Members of the Bank’s governing bodies trained in anti-corruption / to whom anti-corruption policies and procedures have been
communicated
Percentage of management members to whom the
corporate anti-corruption policy and procedures have
been communicated
Percentage of management members who have
received anti-corruption training
Management Board 100% 100%
Supervisory Board 100% 0%
Total 100% 52%
We do not collect aggregate data on the communication of anti-corruption procedures to business partners across the Group. We do not collect data by
regions.
6. Human rights policies and their outcomes
Human rights
Respect and protection of human rights in the Santander Bank Polska Group is a topic regulated by the Responsible Banking and Sustainability Policy,
which in October 2023 replaced two previous documents: Sustainability Policy and Human Rights Policy. The policy’s provisions emphasise the relevance
of commitments to stakeholders and clarify the processes for applying social, environmental and corporate governance standards in line with the
Responsible Banking Model, adopted in the Group in 2023. This internal regulation supports the responsible banking agenda by describing key
responsibilities and processes, assigning duties and responsibilities for key activities and developing a common approach to responsible banking issues.
The Responsible Banking and Sustainability Policy, sets out principles, commitments, objectives and strategy pf the Santander Bank Polska Group in
relation to shareholders, employees, customers, suppliers, society, environment, diversity, fiscal responsibility, respect for human rights and the
prevention of corruption and other illegal activities. These principles cover:
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Relations with employees:
prevention of discrimination and practices that violate human dignity,
refraining from the use of forced labour and child labour,
respect for the right of association and collective bargaining,
fair conditions of employment.
Relations with customers and suppliers:
equal treatment of customers,
equal treatment of suppliers.
Relations with the community:
fight against corruption,
social involvement.
The international standards underpinning the Responsible Banking and Sustainability Policy include, among others:
Equator Principles by the International Finance Corporation,
Universal Declaration of Human Rights,
UN Global Compact,
Principles for Responsible Banking by UNEP FI,
UN Sustainable Development Goals,
UN Guiding Principles on Business and Human Rights,
OECD Guidelines for Multinational Enterprises,
Fundamental Conventions of the International Labour Organisation (ILO).
Sustainable supply chain
In line with the Responsible Banking and Sustainability Policy in force in the Santander Bank Polska Group, we promote respect for ESG commitments
throughout the entire supply chain.
> The most important regulations related to the supply chain management of Group companies are as follows:
Santander Bank
Polska S.A.
Santander
Leasing S.A.
Santander Factoring Sp. z
o. o.
Santander Consumer
Bank S.A.
Santander TFI S.A.
Santander Bank Polska Purchasing
Policy
+ + +
Supplier Selection Procedure of
Santander Bank Polska S.A.
+ + +
Policy on Cooperation with Suppliers
and Outsourcing at Santander Bank
Polska S.A.
+ + +
Responsible Banking and Sustainable
Development Policy
+ + + + +
Procedure for Supplier Management
and Outsourcing at Santander Bank
Polska S.A.
+ + +
In its dealings with suppliers, Santander Bank Polska S.A. takes into account compliance with the principles of fair and equitable treatment, transparency
and integrity. Suppliers are expected to implement policies on ethics and compliance with the law, anti-corruption mechanisms and initiatives to ensure
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business integrity, health and safety standards, workplace diversity and inclusiveness, as well as adherence to the UN Universal Declaration of Human
Rights and the principles of the UN Global Compact.
When qualifying suppliers for collaboration, we verify, among other things.:
their diversification of revenues and whether they do not become dependent on the Bank;
their relevant certifications, e.g. on environmental protection and labour relations;
their ESG policies and codes of ethics in place, anti-corruption proceedings and programmes implemented and reports published;
their ethical approach to finances - we check whether they pay employee contributions, taxes and amounts due to contractors.
We aim to ensure that, ultimately, all the companies that make up the Santander Bank Polska Group include social and environmental criteria in their
supplier assessments, whenever they run procurement processes on their own. In 2023, among the Group companies, such assessments were carried
out by selected companies:
> Group companies incorporating sustainability criteria in the supplier selection procedure
Santander
Bank Polska S.A.
Santander
Consumer Bank S.A.
Santander
Leasing S.A.
Santander
Factoring Sp. z o. o.
Santander
TFI S.A.
Social criteria
+
+
-
-
-
Environmental
criteria
+
+
-
-
-
At Santander Bank Polska S.A., part of the procurement process is a CSR questionnaire, which bidders participating in tender procedures are obliged to
complete.
> Key indicators reflecting the performance of the Bank’s procurement process policies in 2023:
Number of suppliers with an annual turnover of more than PLN 50,000.
1,640
of which the number of suppliers subject to qualification
1,010
Percentage of suppliers - Polish or foreign companies with headquarters or branch registered in Poland
89.5%
Number of completed purchasing processes
384
Percentage of new suppliers that have been reviewed for environmental criteria
100%
Percentage of new suppliers who have been reviewed for social criteria*
100%
* Each bidder will compulsorily complete a CSR survey.
7. Employee policies and their outcomes
The Santander Bank Polska Group’s human and intellectual capital is based on its employees, who are given opportunities to increase their competences
and are systematically motivated to exchange knowledge and self-educate. The Bank’s organisational culture has been built on the basis of values and
ethical standards that build trust and lasting employee loyalty.
A comprehensive set of guidelines and values for all Bank employees is described in the General Code of Conduct. The Code sets performance standards
and shapes desirable attitudes in many dimensions of the organisation’s performance.
Employee issues are also addressed in other documents. The most important of these include:
Work regulations;
HR policies including, inter alia, the Remuneration Policy of Santander Bank Polska S.A. Group;
Training Policy;
Corporate Culture Policy of Santander Bank Polska Group.
The formal framework of the corporate culture is also underpinned by the Responsible Banking and Sustainability Policy which emphasizes the key role
of employees in building the Bank’s success. The document indicates the need to maintain relationships with employees based on mutual trust and
loyalty. The Bank pledges to implement measures to make employees feel motivated, involved and rewarded.
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Elements of the HR policy
Recruitment policy
Santander Bank Polska S.A. recruits new employees both internally and externally using methods and sources which are relevant to existing vacancies.
They include specialist recruitment portals, the Referrals Programme, recruitment agencies, PR campaigns and targeted recruitment campaigns in social
media, practical training and internships and cooperation with Santander Universidades.
The Bank’s employees have precedence over other candidates in the internal recruitment processes at Santander Bank Polska S.A. and the companies
from Santander Consumer Bank Group, which increases their development opportunities and helps build individual career paths.
The candidate profiles are checked to see if they meet the required job criteria in terms of their competencies, experience, knowledge, motivation,
personality and compatibility with the organisational culture. All persons involved in the recruitment process must comply with the business ethics
principles arising from the Labour Code and internal policies, in particular with the confidentiality and non-discrimination regulations.
The Referrals Programme of Santander Bank Polska S.A. engages employees in the recruitment process as it provides an opportunity to recommend
candidates for vacant job roles in the Bank. The system helps to reach a wider group of prospective employees who have relevant skills, aptitude and
motivation, and are interested in taking up a job at the Bank.
The Bank’s recruitment policy describes the recruitment process, establishes the criteria for defining recruitment needs and sets FTE limits.
Management by objectives
Santander Bank Polska S.A. has a standardized management-by-objectives process, which supports the achievement of strategic objectives and the
development of employees. The management-by-objectives process is also one of the elements that build the corporate culture. It promotes activities
in line with our values: Simple, Personal, Friendly and the five corporate behaviours (TEAMS). A core of the process is the regular offering of feedback
and frequent meetings between employee and manager. We also attach great importance to the recognition aspect.
The management-by-objectives process model is common across the Santander Group. Objectives are defined in three dimensions: WHAT (business
objectives), HOW (the way the objectives are achieved) and RISK.
At each stage of the process, employees and managers receive a wide range of support, including training, newsletters, instructions and webinars. In
addition, an intranet page has been created as a knowledge library for employees.
Remuneration policy and bonus schemes
The scope and application of the Remuneration Policy
The rules for remunerating employees are set out in the Remuneration Policy of Santander Bank Polska Group, which covers employees of the bank and
its subsidiaries, including identified employees (known as Material Risk Takers, i.e. employees whose professional activity has a significant impact on the
risk profile of the organisation) excluding members of the Management and Supervisory Boards. The remuneration for members of the management and
supervisory bodies is governed by separate policies described in Chapter XIII “Statement on Corporate Governance in 2023”, section 4 “Governing Bodies”.
The Group’s Remuneration Policy covers a wide range of topics. It defines the rules for determining fixed and variable remuneration, awarding bonuses
for the sales force, identifying and awarding bonuses to material risk takers in the Group, determining remuneration of control function employees and
applying malus clauses (the principles for identifying, assessing and reviewing ex-post performance requiring the application of variable remuneration
adjustments for employees whose actions may have a material impact on the Group’s risk profile).
The purpose of the policy is to ensure long-term sustainable growth of the Group by ensuring that employees are adequately remunerated and effectively
motivated to deliver best results and to achieve the strategic goals. The remuneration system is consistent with the interests of key stakeholder groups
(shareholders, employees, customers and communities) and supports long-term value creation, while taking into account such aspects as risk
management, strategy, interests of the organisation, capital requirements and corporate culture. The practices related to the Remuneration Policy are
gender neutral. They allow the Group to recruit and retain top talent using a competitive remuneration package including base salary, bonus schemes
and attractive benefits which include:
base salary,
bonus schemes and ,
additional benefits.
The regulations in place in the Group promote excessive risk avoidance among employees.
The owner of the Policy is the Management Board of Santander Bank Polska S.A., which is responsible for major updates and review of the Policy at least
once a year. The Bank’s organisational unit in charge of remuneration assists the Management Board in this process. The Supervisory Board is responsible
for overseeing the Policy, approving it, reviewing the remuneration principles and assessing their impact on the Bank’s management at least once a year.
The Remuneration Policy of Santander Bank Polska Group was prepared in cooperation with the Risk units, the Compliance Area and the Legal Area. In
determining remuneration, we use reports offered by an independent consulting firm. The remuneration principles applied are subject to an independent
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internal review carried out annually by the Internal Audit Area of Santander Bank Polska S.A. A report on the review is presented to the Supervisory Board
and the Remuneration Committee of the Supervisory Board.
In determining the proportion of variable to fixed remuneration components, Santander Bank Polska S.A. takes into account the opinions of the
shareholders (as a general rule, it is then necessary to obtain the approval of the General Meeting of Shareholders by a majority of 2/3 of votes in the
presence of persons representing at least half of the share capital).
Fixed remuneration
The key component of remuneration at Santander Bank Polska S.A. is the base salary, which is determined on the basis of the role performed, scope of
responsibility, qualifications and experience. In its approach to job valuation, the Bank’s remuneration unit uses best market practice to ensure
competitiveness of remuneration. In response to dynamic changes in the labour market, the Group’s remuneration system is periodically revised using
payroll reports of leading advisory companies and data published by Poland’s Central Statistical Office (GUS).
The last comprehensive review of base salaries in relation to the market was conducted in Q3 2023, based on the following assumptions:
ensure that base salaries reflect market rates;
increase the pay of the lowest earners across the Bank;
ensure equal pay for women and men performing the same roles;
reward employees engaged in the Bank’s digital transformation and in strategic projects and initiatives;
reward top performers who demonstrate the Bank’s corporate values.
The review resulted in a pay rise process in Q3 2023. Its intended effect is to improve the competitiveness of the Bank’s salaries compared to the market
and to reduce the gender pay gap. The Bank monitors the situation in the remuneration market on an ongoing basis (based, among other things, on salary
reports) and takes appropriate decisions as part of the implementation of the remuneration strategy.
Variable components of remuneration
The employees of Santander Bank Polska Group are subject to bonus schemes defining the variable component of their remuneration. The bonus schemes
enhance staff motivation and support the delivery of strategic objectives set by the organisation. The awarding criteria and bonus levels are strictly linked
to business and qualitative results of the Group and individual employees whose performance, delivery of objectives, behaviours and engagement are
reviewed on a regular basis.
The Group’s employees are set individual objectives that correspond to the activities of a given organisational unit. The objectives of the employees within
the control units (internal audit, compliance area, risk management units and HR units) arise from the roles they perform and their remuneration does
not depend on the financial performance of business areas they control. In the case of the sales staff, in addition to quantitative and qualitative objectives
the performance review also covers the indicators related to customer service, risk management and compliance with the applicable regulations.
Variable remuneration depends on a bonus scheme relevant to a given employee (including bonus regulations for front-office staff, back-office staff and
employees of control units). Individual bonus schemes differ in terms of eligibility criteria, bonus amount and payment frequency. Bonus payment is
conditioned upon the delivery of specific quantitative objectives (e.g. a stated gross or net profit growth rate or amount, credit cost, NPL, RWA) and
satisfaction of qualitative criteria (e.g. customer satisfaction). It is also possible to grant individual discretionary awards in accordance with the Bank’s
internal regulations.
The ratio of total variable remuneration to fixed remuneration may not exceed the limit of 100%, even in the event of above-average performance.
However, in extraordinary cases, this threshold may be increased to a maximum of 200%, subject to the approval of the Annual General Meeting.
Given that the bonus criteria (defined in the applicable regulations) were met, the annual bonus for 2022 was paid to the Bank’s employees in 2023. The
payments were made in March 2023.
Social benefits and perks
The Group also offers additional benefits tailored to employees’ needs, such as medical care or a cafeteria system providing access to a wide range of
cultural, sporting and tourism benefits.
Regardless of the type of employment contract (full-time vs. part-time), employees receive additional benefits. The benefits offered by the Group
companies are presented below:
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Santander Bank
Polska S.A.
private medical care
cafeteria system
co-financing of the Multisport card
loans for house renovation and other housing purposes
financial assistance - support for persons in a difficult life and financial situation
support for parents: holiday subsidies for children, school starter kits, care in day nurseries, children’s clubs and
kindergartens financed from the Social Benefits Fund (ZFŚS)
annual holiday allowance for Bank’s pensioners
allowances for persons with disabilities
financial allowance for pro-
health purposes, 2 days off for persons with light disabilities and entirely remote work option
for such persons (where the organisation and type of work permits)
Santander
Consumer
Bank S.A.
private medical care
Social Benefits Fund (ZFŚS):
Multisport card,
loans for renovation and housing purposes,
allowances - support for people in a difficult life and financial situation (including pensioners),
holiday subsidies for children
Children’s Day contribution
Christmas subsidy (also for pensioners)
summer holiday subsidy (also for pensioners)
Additional length of service benefits:
additional paid days off - 1 to 5 days (number increases every 5 years after 5 years of seniority)
seniority gift (every 5 years from 10 years of seniority)
retirement gift
Santander TFI
private medical care
psychological support
subsidised insurance policy
sports card
extra free time
Santander Factoring
private medical care
group insurance
English language learning
sports card
reimbursement of eyeglasses
Santander Leasing
private medical care
Multisport card
MyBenefit cafeteria,
group insurance,
English language courses,
Spanish language courses,
Company Social Benefits Fund,
financial services,
subsidies for contact lenses or eyeglasses.
At Santander Bank Polska Group, we make sure that employees are familiar with the benefit offer and know exactly which social benefits they can avail
of.
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Key HR initiatives in 2023
The HR strategy of Santander Bank Polska Group focuses particularly on creating an employee-focused corporate culture, improving employee
experience by modelling the corporate culture, ensuring employee wellbeing, digitalising processes and ensuring flexible work environment.
The Group’s human resources strategy and strategic priorities are presented in Chapter V ‘Employee relations’, where the Group’s workforce structure in
various dimensions is also presented. Below find the information on the employment structure by gender.
> Employment by gender (“active” employees)
Number of employees
2023
2022
Female
Male
Female
Male
Group 7,892 3,955 7,877 3,816
Bank 6,637 3,300 6,580 3,152
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A selection of the activities implemented in 2023 as part of the HR strategy execution are summarised below.
Number of employees
2023
2022
Female
Male
Female
Male
Group 6,580 3,816 7,877 3,704
Bank 7,887 3,152 6,546 3,038
A selection of the activities implemented in 2023 as part of the HR strategy execution are summarised below.
HR projects
Activities implemented in 2023
Creation of an
employee-focused
corporate culture
Wide-scale development activities continued, including:
”Young Leaders” –
a global talent programme to enhance the leadership competencies of those with the highest
leadership potential
”Development Elixir” – a series of articles and inspirational sessions open to all Bank employees whose topics are mainly
related to personal performance and management of emotions;
”Be Tech&Business” –
a global talent development programme for STEM professionals (Science, Technology, Economics,
Mathematics);
”Dojo” –
a global website to support employee development, providing unlimited access to proprietary material
(Santander) and popular commercial tools, such as LinkedLearning, O’Reily, Netex or Bookmark.
The „Digitisation Fan” internship programme and development programmes for advisers were rolled out in the Branch
Network: „Advisor of the Future”, „Leader Academy” and „Powerful Leader” for sales team managers.
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Building a positive
employee experience
Three rounds of the ‘Your Voice’ employee satisfaction survey were conducted and analysed, with a total response of over
90% of employees.
We recorded record increases in eNPS (Employee Net Promoter Score) and Employee Engagement
score. This result was influenced by a number of measures implemented to improve the Bank’s employee experience.
The Bank’s employee experience management was improved. The working methodology was enhanced by adapting it to
the current needs of employees and the organisation through an even stronger reliance on data and the use of design
methodologies (service design).
In line with the
employee experience management model, the related initiatives are implemented through two types of
dedicated HR projects led by managers from the Bank and involving cross-functional employee teams:
Hot Spots -
projects to improve pain points resulting from the employee satisfaction survey. In 2023, a number of
initiatives have been introduced in the areas of financial and non-
financial employee recognition, addressing workload,
promoting employee off
erings and improving employee onboarding, among others. Two of the Hot Spots (“I provide
simple and efficient service to retail customers” and “I know how meeting my individual goals supports customers and
the Bank’s objectives”) successfully met their objectives and were closed. The work under the Hot Spots “My workload
allows me to take care of myself”, “My work is appreciated” and “I am well implemented 2.0” continued throughout the
year and will continue in the following year.
Gain Spots -
the purpose of the projects is to reinforce the points that are identified in employee surveys as strengths of
the work experience in the organisation. In the last quarter of 2023, analyses were carried out, based on which two
themes were iden
tified for further strengthening in the following year: employee development and the involvement of
employees in the development and testing processes of the Bank’s products and services.
The work on employee experience within the individual Bank Divisions is supported by the Employee Experience Champions
(the Division change leaders responsible for managing the local employee experience agenda, supported by the Employee
Experience Competence Centre team and HRBP).
A regular EX Forum was held -
a meeting of members of the Management Board, top managers, representatives of the
Business Partnerships Division and Hot Spot leaders, devoted entirely to the status of work on the employee experience at
Santander Bank Polska
. In 2023, a new initiative called EX #onTheWay was introduced, with periodic meetings for
employees in different cities in Poland in order to strengthen dialogue with employees and create solutions together.
Work was started on systemically integrating the employee dimension into the business agenda, i.e. employee experience
when launching new processes and initiatives.
Work was completed on the Bank’s new strategy for 2024-
2026, which incorporates the employee experience in an even
stronger way than before.
Wellbeing & Mental
Health
Cyclical activities on physical health, mental health, successful relationships and financial education were implemented:
Health Week with the theme ‚Take care of yourself -
from head to toe’ was organised which included webinars on women’s
health issues, nutrition topics and meetings with doctors on cancer prevention.
A total of 4,982 participants registered for
all events.
Preventive action for employees glucose testing in mobile gluco-buses in various locations in Poland.
Santander Helps charity campaign in partnership with the Santander Foundation, with 2046 participants.
The „Keep an eye on eye hygiene” campaign dedicated to eye hygiene. It included eye screening in offices, yoga for sight, a
webinar - diet for sight and a meeting with an optometrist.
A series of articles aimed at all employees and their families who are struggling with the topic of allergies entitled „How to
live with allergies?”.
RakReaton -
a campaign in which the „Rescue of Children with Cancer” Foundation invited companies from all over Poland
to take part in a sports challenge. A total of 763 employees signed up to the initiative to cover the distance together by
cycling, walking, rollerblading or Nordic walking etc. The campaign raised PLN 160,000 to support children with cancer.
World Wellbeing Day - 3 webinars and 3 workshops for all bank employees at various locations on taking care of mental
and physical health, which were attended by a total of more than 700 people. In addition, surprises were prepared especially
for Branch Banking - all branches
received packages with healthy items and healthy eating guidelines prepared by a
nutritionist.
Leadership
The transformation of leadership at the Bank continued, mainly in the direction of „human-centred leadership”, a concept
that puts people at the centre and assumes a special role for the leader in building the employee experience.
Development
activities were primarily addressed to the Management Board and top management. They focused on ensuring a relevant
and talented manpower through courage in leadership, building trust and psychological and emotional security, taking into
accoun
t diversity (including neurodiversity) and supporting the mental balance of employees. The aforementioned
managerial competences were identified as key in the face of current challenges.
Processes were
implemented to ensure the succession of 150 key roles in the Bank with a view to business continuity and
filling key positions. In doing so, care was taken to ensure a diverse workforce in terms of geography, business units and
gender.
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Digitising processes
and providing a
flexible working
environment
2023 marked a milestone in the implementation of the paperless strategy. A key value for our employees is the possibility
to complete the majority of HR processes fully online thanks to the availability of personal e-
Files (employees have
reviewed more than 70,000 documents in a self-service mode), which directly translates into reduced workload for HR
departments and less paper consumption. Combined with the previously implemented e-
Signature solution, 25,000 of our
employees’ documents were reprocessed 100% online.
2023 also meant even more convenient ecosystems around HR services and processes. Our employees can take better and
easier care of their health, thanks to a new online application to change their healthcare package (for themselves and their
loved ones). Before an employee makes a change, he or she can easily view and compare packages,
making the best choice
for him or her (around 4,500 employees have already taken advantage of this opportunity). Another solution in the health
category is the possibility to
apply online for a prior medical examination referral and the simple settlement of a subsidy
for eyeglasses or corrective lenses. As a result, employees are more likely to be reimbursed for eyeglasses or contact lenses
.
At the same time, the handling of submitted applications is kept to a minimum.
Digitisation is more than just a functional benefit for our solutions, it is also a tangible financial benefit for our employees -
such as the 50% income deductible costs application, which translates directly into financial benefit for employees and the
company and is a fully self-
service process. By designing it together with users, we have delivered a highly intuitive solution
where employees can quickly and continuously record the time spent producing unique solutions.
8. Diversity policy and its outcomes
Foundations of a diversity-promoting attitude
Santander Bank Polska Group complies with the laws on diversity, inclusion and equal opportunities. It is committed to promoting diversity in accordance
with best practice and ensuring equal treatment of employees and other stakeholders regardless of their gender, age, education, health conditions, race,
religion, national or ethnic origin, political beliefs, trade union membership, family status or sexual orientation.
Aspects such as respect for individuality, promotion of equal treatment and prevention of discrimination are addressed by a number of policies and
procedures applicable at the Bank, including the Sustainability Policy, the Diversity Policy, the Respect and Dignity Policy and the Corporate Culture Policy
of Santander Bank Polska Group.
Furthermore, as a signatory to the Diversity Charter (the international initiative supported by the European Commission), Santander Bank Polska S.A.
committed itself to respecting and supporting diversity. Respect for individualism, equal treatment and prevention of discrimination are the cornerstones
of the Bank’s corporate culture.
The culture of diversity and inclusiveness is supported at the bank through initiatives such as Diversity Ambassadors (top management promoting these
values), Employee Networks (grassroots employee initiatives focused on promoting diversity), educational campaigns, training, webinars (e.g. Diversity
Month, Pride Month). The bank’s activities in this area are strengthened by strategic partnerships with expert organisations: Share the Care, UN Global
Compact, Vital Voices and Responsible Business Forum.
In addition, the bank was ranked for the third consecutive year as one of the most advanced employers in Poland when it comes to diversity and inclusion.
The list is the result of the Diversity IN Check survey, which examines the level of maturity of organisations in managing diversity and building an inclusive
work environment. The survey is conducted by the Responsible Business Forum, which coordinates the Diversity Charter in Poland.
As a result of the activities carried out, Santander Bank Polska received two awards: the title of Top Employer 2023 (awarded by the Top Employers
Institute) and the Great Place to Work! certificate (awarded on the basis of a survey of employee opinions by an independent research company).
The bank pursues a diversity strategy in the selection, qualification assessment and succession processes of its governing bodies.
The aforementioned processes ensure that there is no discrimination of any kind, in particular with regard to gender, race, colour, descent, genetic
background, religion or belief, membership of a national minority, property, birth, disability, age or sexual orientation.
The diversity policy with regard to the supervisory and management bodies is described in Chapter XIII ”Corporate Governance Statement for 2023”.
Below we present the results of the implementation of diversity polices at the Bank. Data for the Santander Bank Polska Group are under attestation.
They will be published in the 2023 ESG Report.
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> Santander Bank Polska's employees by employment category, age group and gender (per person).
As at 31 December 2023
Employees
Number of employees in the Bank
% of employees in the Bank
Female
Male
Total
Female
Male
% of total category
Senior
management*
up to 30
years old
0
0 0 0.00% 0.00% 0.00%
30-50 years
old
24
48 72 0.24% 0.48% 0.71%
over 50 years
old
16
19 35 0.16% 0.19% 0.35%
Total 40
67
107
0.40%
0.66%
1.06%
Other
management
up to 30
years old
16
20 36 0.16% 0.20% 0.36%
30-50 years
old
538
418 956 5.34% 4.15% 9.49%
over 50 years
old
205
117 322 2.03% 1.16% 3.20%
Total 759
555
1 314
7.53%
5.51%
13.04%
Other employees
up to 30
years old
1 055
492 1 547 10.47% 4.88% 15.35%
30-50 years
old
3 737
1 727 5 464 37.08% 17.14% 54.22%
over 50 years
old
1 193
453 1 646 11.84% 4.49% 16.33%
Total 5 985
2 672
8 657
59.39%
26.51%
85.90%
* This category does not include Management Board members who belong to the “Top management” category.
> Santander Bank Polska’s foreign employees (persons). As at 31 December 2023
Foreign employees
Number of foreign employees
% of foreign employees by age and gender
Female
Male
Total
Female
Male
Total
up to 30 years old 24 15 39 0.20% 0.15% 0.39%
30-50 years old 12 4 16 0.12% 0.04% 0.16%
over 50 years old 2 4 6 0.02% 0.04% 0.06%
Total 38 23 61 0.38% 0.23% 0.60%
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9. Customer experience management policy
Since 2022, the Santander Bank Polska Group has had a Customer Experience Management Policy (CX Policy) in place.
The CX Policy describes the customer experience management process and the bank’s key customer-centric standards. The customer experience
management process starts with a diagnosis of customer needs, followed by setting NPS goals and planning appropriate initiatives, followed by
implementation, ongoing monitoring and reporting. The customer-centric standards define the framework for the implementation of initiatives to
improve the customer experience. In 2023, Santander Bank Polska S.A. prepared new customer service standards. The changes were inspired by
qualitative interviews conducted with 24 customers and quantitative research involving 467 employees.
We ensure a positive experience for all customers by:
applying service standards that meet current market trends,
adapting the solutions offered to customers’ expectations,
responsible sales practices and preventing the sale of financial products that do not meet customer needs (misselling),
raising customer awareness of cybersecurity,
adhering to ethical principles in marketing communications, providing reliable and understandable information about products and services.
The measures we took in 2023 were recognised by customers. In the NPS survey for a mass customer, we were among the top 3 most recommended
banks, which was an increase of 1 position compared to the previous year. In the group of affluent customers, we maintained our third NPS position, and
the nominal value of this indicator increased by 6pp compared to the previous year. Among small and medium-sized business customers, we achieved
second place among the most recommended banks. We also see a significant improvement in NPS performance among corporate and investment
banking customers by 12pp and Private Banking by 16pp (year-on-year).
Complaints management
We care about the high quality of the complaints handling process. Customers of Santander Bank Polska S.A. can file complaints:
in branches,
through the Call Centre,
in online and mobile banking,
by post.
If we cannot accept a complaint, we inform the customer how they can appeal against our decision, internally to the Customer Care Officer or to external
institutions. We regularly review the quality and speed of our work and satisfaction/referral levels (confirmed by surveys). In addition, as of September
2023, we have introduced a post-complaint phone call process for certain categories of complaints. Our advisors call customers to communicate the
response to the complaint, clarify any doubts or questions and suggest solutions that customers might benefit from. We use the findings and results to
improve the process of reporting and handling complaints.
We have described the rules for accepting and handling complaints in the terms and conditions of the individual products (for loans, in loan contracts).
Customers will also find them on our website.
To facilitate reporting of serious concerns to the Management Board, a special unit in the Compliance Area has been set up in the Bank to analyse and
report on complaint trends and incidents contributing to a significant increase in the number of complaints. Information on complaints is part of the
quarterly report presented to the Management Board and the Supervisory Board. In addition, complaints issues are discussed once a year at a meeting
of the Management Board and the Audit and Compliance Committee.
We respond to complaints in the manner chosen by the customer. The available forms of response are a letter or a message in online and mobile banking.
In 2023:
67% of complaints were resolved within three working days.
27% of cases were dealt 'on the spot' - by bank staff accepting the complaint on the basis of their authority. This means that the customer received
a decision immediately after submitting the complaint.
96% of the cases we handle through the simplified process were resolved within one working day.
86% of our responses were provided electronically.
Barrier-free service and digital accessibility
The Group tailors its offering, service and delivery system to the needs of all customers. We offer inclusive services in traditional branches, digital
channels and, in addition, we have a network of self-service facilities. Among other things, we increase accessibility through the “Barrier-free service”
programme implemented at Santander Bank Polska S.A. consistently since 2010. The aim of this programme is to provide access to the Bank’s offering
to customers with special needs, including people with disabilities and senior citizens. Thanks to modern technologies, we are consistently increasing
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the possibility of remote use of our products and services across the Group. At the same time, we take care to provide the right conditions for customers
in traditional branches.
Barrier-free service
Barrier-free Service Standards are in place at all branches and partner outlets. They are equipped with, among other things, mini magnifying glasses and
frames to make signing easier for the visually impaired and blind customers. At the Bank’s partner outlets and branches, it is possible to connect online
with an advisor who speaks Polish Sign Language (PJM). This is also possible when using the Santander mobile application, Santander online services
and on our website.
Barrier-free branches
Branches are designed and upgraded in accordance with accessibility guidelines. For years, the Bank has also been implementing a process of barrier-
free branch architectural audits and certification. Approximately 45% of Santander Bank Polska S.A. branches have been certified for architectural
accessibility for people with disabilities.
23 branches are equipped with a tactile path and 15 branches with a typhlographic map, i.e. a multisensory plan of the branch with convex elements
reflecting the layout of the branch, with descriptions in Braille and a button for calling staff. TOTUPOINT, a navigation and information system to aid
spatial orientation and enhance safety for visually impaired patients, is installed in 30 locations.
In 56 branches, there are portable induction loops, devices that facilitate conversations for hearing-impaired customers who use hearing aids.
Barrier-free remote channels
Online and mobile banking, as well as the pages of the Bank’s website (www.santander.pl) are being developed and equipped with user-friendly facilities
and checked for accessibility for customers with disabilities. The Bank allows customers to log in to the mobile banking application with their fingerprint
or through facial recognition, among other things.
Customers calling our Contact Centre can use Call Steering technology - also known as voice IVR - which enables recognition and interpretation of human
speech. A virtual assistant asks the customer what they would like to talk about and, based on the answer, directs the call to the appropriate advisor. Call
Steering technology creates a voice-managed, modern, intuitive IVR environment for the customer, reduces call duration and the time it takes to reach
an advisor, thereby increasing customer satisfaction.
Barrier-free communication
The Bank’s advertising messages are adapted to the needs of visually and hearing impaired people. Videos posted on the Barrier-Free Service website
and on the bank’s YouTube channel are available with subtitles, audio description (voice-over) and a Polish Sign Language interpreter.
The Bank also provides the possibility to request - remotely or in branches - so-called accessible documents (non-personalised contract templates,
regulations) as required under the Accessibility for Persons with Special Needs Act.
10. Social policies and their outcomes
The Santander Bank Polska Group is committed to long-term social projects that not only respond to the needs of local communities but also aim to
create positive change in society. Our approach to social involvement is defined by our Responsible Banking and Sustainability Policy. We address
significant social challenges, such as:
education - supporting higher education by funding scholarships for students, disseminating financial and cybersecurity knowledge;
financial inclusion by facilitating access to banking products and services;
civil society development;
supporting entrepreneurship;
sponsorship of culture and sport.
Sponsorship, charity and volunteering activities are described below.
Key sponsorship projects in 2023
In 2023, Santander Bank Polska S.A.’s sponsorship activities continued to focus on three main areas: education (in particular financial education), sport
and culture. Notably, the Bank continued to pursue long-term projects that offer greater opportunities to create a lasting association between an event
and the Bank. New image projects were also launched, involving experts from various areas of the Bank. The Bank was also actively involved in the
promotion and communication of two of the Santander Group’s global image sponsorship projects, namely the partnership with Scuderia Ferrari and with
the League of Legends European Championship (LEC).
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> Key sponsorship projects continued/initiated in 2023
Scuderia Ferrari
In December 2021, Banco Santander announced becoming one of the key partners of Scuderia Ferrari, which it has been
working with since 2010. From the start of the 2022 season, the Santander logo will appear on the vehicles, overalls and
caps of Scuderia Ferrari drivers.
Over the duration of the multi-
year partnership agreement, Santander will provide Scuderia Ferrari with solutions to support
the Team in its plans to achieve carbon neutrality by 2030.
In 2023, Santander Group launched the Santander Lap Zero project in its geographies - a quiz on F1 knowledge, in which
participants answered questions about racing but also about important sustainability issues. The questions broadened
knowledge about F1’s history and results but also about plans to reduce carbon emissions: switching to green fuels,
promoting hybrid drives or using recyclable materials in vehicles. Prizes for the best participants included gadgets with the
F1 logo and the grand prize - the F1 VIP experience package.
League of Legends
European
Championship
(LEC)
In 2022, Banco Santander signed a long-term partnership agreement with the League of Legends European Championship
(LEC), becoming the main sponsor of the League of Legends competition in Europe and Latin America (the most popular
eSports game in the world).
The sponsorship agreement with the LEC will support the bank in promoting innovation, diversity and digitalisation.
Under the slogan ‚Level Up Your Dreams’, the Santander Group wants to build a new community to help the younger
generations achieve success
Santander Summer
Sounds
Santander Bank Polska has become the title sponsor of the summer concert tour “Santander Summer Sounds 2023” - a
series of weekend concerts by the best Polish male and female artists (including Mrozu, Zalewski, Vito Bambino, Brodka,
Zawiałow, Nosowska, Rubens, Kacperczyk and others)
117 concerts featuring over 30 artists over 18 festival days - from 23 June to 2 September 2023.
9 cities: Bielsko-Biała, Kraków, Rzeszów, Lublin, Warsaw, Łódź, Gdańsk, Wrocław and Poznań
The festival was attended by more than 60,000 people (69% women, 31% men, age: 25-34 - 42%, 35-44: 33%)
During the festival, an intergenerational project entitled ‚Indian Summer’ was carried out, bringing together representatives
of different musical realms on one stage. Natalia Kukulska took artistic charge of the initiative. The artist invited Bovska,
Margaret, Zalia and Mery Spolsky to collaborate.
In the bank’s mobile application, customers could buy tickets and passes for all concerts with a 20% discount (almost 5,000
tickets sold in the application). In addition, customers received a 5% discount in the catering area at the festival.
“Picasso”
temporary
exhibition
Santander Bank Polska was a sponsor of the temporary exhibition ‚Picasso’. The Polish public could admire the works of
Pablo Picasso - one of Spain’s greatest artists - in the interiors of the National Museum in Warsaw. The exhibition, held on
the occasion
of the 50th anniversary of the artist’s death and Spain’s assumption of the Presidency of the Council of the
European Union, was on view for three months -
from 12 October 2023 to 14 January 2024. It featured over 120 works by
Picasso, including prints, c
eramics and book illustrations created by the artist over several decades. Most of the works came
from the collection of the Museo Casa Natal Picasso (Picasso’s Birthplace Museum) in Málaga and were presented in Poland
for the first time. In addition to works on loan from the Museo Casa Natal Picasso, the exhibition also featured a selection
of works by the artist from the collection of the National Museum in Warsaw (MNW), including works donated to the
Museum by Picasso himself when he visited Poland in 1948.
The exhibition was accompanied by an educational programme aimed at adults and young people (including curator tours,
Thursday lectures, ceramics workshops, lithography workshops) and children (e.g. animations - open art activities).
The exhibition was accessible to persons with special needs, including a guide in Polish Sign Language for deaf people during
the tour. A guided tour in Polish Sign Language and a guided tour with audio description (for the blind and visually impaired)
were also organised. Admission to these events was free.
The exhibition enjoyed record audience interest. During three months 142,891 people had seen the exhibition.
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Economic
education project
”Finansiaki”
“Finansiaki” is a proprietary project of Santander Bank Polska S.A., which aims to support the educational competences in
the area of finance and entrepreneurship of parents and teachers by providing them with relevant educational materials.
At the heart of the project is the website https://finansiaki.pl/, which has been operational since December 2016. The
educational materials posted there have been developed by experts and include a variety of ideas for introducing children
to the world of
finance, building knowledge about money management through play and spending time together with
children.
The programme is complemented by classes in kindergartens and schools run by bank employees as part of corporate
volunteering, a free guide for parents “Finansiaki To My!” for teaching children entrepreneurial attitudes, and “Finansiaki to
My” profiles on Facebook and Instagram showing parents and teachers how to introduce children to financial knowledge in
a simple and straightforward way.
A number of activities were carried out as part of the project in 2023, including:
a survey of parents and teenagers aged 12-15 and 16-18 (“Portrait of teenagers “) conducted by the IQS research agency.
Based on the results of the survey, a four-
stage educational campaign was prepared on how teenagers deal with the
world of finance - fro
m everyday, small expenses to planning for the future. What emotions they feel about the modern
world, what fears they experience and where they actually find the knowledge about sound money management.
a wide-ranging educational campaign with Onet.pl “Young and Money”: a recording session in Onet Rano Wiem with an
expert, economic psychologist Dr Agata Trzcińska, an editorial section with proprietary educational materials: “Where do
teenagers get their k
nowledge of finance from and what can we do to increase their awareness in this area, teenagers’
fears related to safety on the Internet, a video debate with experts “The Young and Money - how does economic education
affect the future of teenagers?”
The Bank became a partner of the Around the World board game , which promotes financial education and teaches the
basics of entrepreneurship. Cooperation with Science Boards and expert consultation of the game content by Dr Agata
Trzcińska, consultant of the Finansiaki project. The game was released in December 2023.
”Finansiaki to my” in numbers:
15,213 downloads of lesson plans for teachers, educational articles and an e-book guide for parents “Finansiaki. To my”
from the finansiaki.pl website
1,052 children from primary schools and kindergartens took part in financial education classes conducted by Santander
Bank Polska employee volunteers
14,
315 copies of “Finansiaki. To my” guide in pdf version, sent to Santander Bank Polska customers together with
regulations for an account for children up to the age of 12 between January and December 2023
506 pupils attending lessons conducted by teachers in primary schools and kindergartens (on the basis of ready-made
lesson scripts downloaded from the finansiaki.pl portal)
821,335 recipients of the educational campaign „The Young and Money” carried out in cooperation with Onet.pl
Workshop for
teenagers
„Financial Games”
2023 edition
The Bank, in partnership with MCA BIS Sp. z o.o, organised the second edition of a series of financial education workshops
“Financial Games” for teenagers - students of grades 5-8 of primary schools. The aim of the project is to familiarise the
students with difficult financial topics in an easy and enjoyable way
. During interactive activities, students took part in a
financial strategy game in which the task was to manage their budgets as well as possible.
The workshops were held in September and October 2023 in 10 cities: Toruń, Szczecin, Olsztyn, Gdynia, Łódź, Legnica,
Kraków, Rzeszów, Kalisz, Ostrów Wielkopolski.
5 thematic areas: 1. Money, payments and cyber security; 2. Demand, supply and prices; 3. Advertising and its influence
on purchase decisions; 4. Credits and loans; 5. Savings and interest.
Number of beneficiaries/students trained: almost 2500; number of classes: 138, number of participating schools: 50
Evaluation surveys: initial and final, checking students’ knowledge: average increase in knowledge was +29 pp. The
largest increase was in the area of banking with an average of +44 pp.
Workshops as assessed by teachers: 5.9 (on a 1-6 scale).
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Educational project
„Security in
Cyberspace”
Santander Bank Polska is a partner of the project ‘Security in Cyberspace’, which was launched in 2017 and is coordinated
by the Warsaw Institute of Banking (WIB). The aim of the project is to impart basic knowledge on broadly understood online
security and to develop practical skills related to the use of new technologies, as well as to raise awareness of cyber threats
and develop appropriate attitudes in the area of cyber security. It is aimed at various audiences (mainly schoolchildren,
college students and seniors).
In 2023, the project involved, among other things:
lessons for primary and secondary school students, lectures and trainings for first-year students, knowledge tests Cyber
Genius Student (2,891 participants), Cyber Genius Student (1,000 participants), educational trainings (workshops) with
seniors,
activities on the occasion of the European Cyber Security Month: a nationwide online lesson with a Santander Bank Poland
expert on cyber security (6,409 participants) and two other lessons for primary and secondary schools (approx. 3,000
people).
In 2023, a total of approximately 2,000 lessons, lectures, webinars, training courses, e-learning, conferences and
competitions were conducted as part of the project. The project reached approximately 287,000 participants (children and
young people, students, seniors).
Detailed information about the project is available at: https://cyberbezpieczenstwo.edu.pl or https://cyber.wib.edu.pl/.
Sustainability
taught at
universities
In 2023, the Bank continued the partnership established in 2022 with the HumanDOC Foundation within the framework of
the project to introduce the new subject „Sustainability” at universities. The subject was permanently introduced into the
compulsory cours
e grid of 13 humanities programs at 3 universities as of October 2022: University of Warsaw, University
of Opole and University of Wrocław.
As part of the 2022 project, a multimedia textbook was produced for students, developed by researchers from the
aforementioned universities. It has been made available free of charge, for download at https://zr.humandoc.pl/. In 2023,
thanks to the Bank’s support, an audiobook (prepared on the basis of the textbook) was also released to make it accessible
to an even wider audience.
In the academic year 2022/2023, 214 students at 3 universities participated in the „Sustainability” course, and in
2023/2024, 246 students attended the winter semester of the course.
Trendbook
The Bank was the exclusive partner of the 2nd and 3rd seasons of ‚Trendbook’ - a series of interesting live conversations
with guests from the business top league on Radio 357, carried out jointly with the daily newspaper ‚Puls Biznesu’. It is a
programme presenting the impact that global changes have on business and the decisions we make. Its creators track trends
in the world of technology, business and media, shaping the way we live, work and buy.
Season 2 (6 episodes), launched on 12 January 2023 and season 3 (6 episodes) premiered on 20 April 2023. Bank employees
were also experts in four episodes of these seasons.
Re:Generation
Since 2021, the Bank has been a partner to the Re:Generation programme, implemented by the UNEP-GRID Warsaw Centre.
In 2022, thanks to the Bank’s support, a flower meadow - a feeding ground for pollinating insects - was successfully restored
in the Łódź Heights Landscape Park and two pollinator houses were erected. In 2023, the Bank supported the mowing of
this meadow -
to maintain the effect achieved. In 2023, the Bank additionally supported the protection of a wet meadow
which contains the largest site of the protected broad-leaved cuckoo orchid in the park.
In June and September 2023, field environmental workshops for children on meadows and pollinators were held in the park.
The five workshops were attended by 119 pupils from grades 1-3 and teachers from primary schools in Łódź.
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Santander Bank Polska Foundation
Foundation activities in 2023
In 2023, Santander Bank Polska Foundation signed donation agreements with community partners in the area of*:
education
budget: PLN 578,197.00
charity
budget: PLN 801,345.21
culture
budget: PLN 28,500
* Report based on preliminary data as of December 31, 2023. The final version of the financial report on the activities of the Santander Foundation will be available from June
30, 2024 on the website www.fundacja.santander.pl.
The most important cyclical projects run by the Foundation include grant programmes. In 2023, the following grant programmes were conducted:
Here I Live, Here I Make ECO Changes
The aim of the programme is to change our immediate surroundings.
Projects include, for example, mini-parks, revitalisation of community
gardens, building rain gardens and many other ideas for children and young
people. The competition jury particularly appreciates original environment-
friendly initiatives that are driven by social needs. It is essential for the
project to be carried out in a public space and for the newly created or
revitalised friendly place to be intended for children and young people. In
2023, 20 grants of PLN 10,000 each were planned, with 15 grants of PLN
10,000 each paid out by the end of the year. The results of the final 2023
edition were announced on 31 January 2024. Number of planned grants:
five (PLN 10,000 each).
Number of organisations helped by the end of 2023: 15
Number of beneficiaries: 3,635
Programme budget: PLN 200,000
Bank of Young Sports Champions
The Bank of Young Sports Champions grant programme aims to promote
sporting ventures and the principles of fair play in sport. In the 2023 edition,
sporting ventures were supported for people aged between 5 and 26. The
priority was to promote the physical development of programme
beneficiaries. Among the winners of the competition were entities
organising team sports competitions, Olympics and Paralympics with a
special focus on promoting the principles of fair-play in sport. Physical
exercise has a huge impact on the functioning of the entire human body,
fitness and general well-being, which is why we promote active leisure.
Grant amount: max. PLN 7,000.
By the end of 2023, 24 grants of PLN 2,750 to PLN 7,000 had been paid out.
The results of the final 2023 edition were announced on 31 January 2024.
Number of organisations helped by the end of 2023: 24
Number of beneficiaries: 6,090
Programme budget: PLN 160,000
Together for eco-change
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The idea behind the programme is for the Santander Bank Polska
Foundation and Santander Leasing to fund at least 17 electric vehicle
charging stations. The grant awarded covers the costs of construction,
servicing and maintenance of AC electric vehicle charging stations with a
capacity of 2 x 11kW for 24 months.
The programme supports efforts to improve air quality, reduce greenhouse
gas emissions, achieve climate neutrality in the EU by 2050, reduce noise
levels and energy and fuel consumption in transport. The total value of the
grants is PLN 1 million. Car charging stations will be installed successively in
2024. The project was prepared jointly by the Santander Bank Polska
Foundation and Santander Leasing. Partners of the action are GreenWay
Polska and the Polish Alternative Fuels Association (PSPA).
Number of organisations helped under the programme: 17
Number of beneficiaries: 16,251
Programme budget: PLN 1,000,000
The Foundation’s other programmes include:
Scholarship programmes
In 2018, Santander Foundation launched its Scholarship Programme for the first time. The Foundation’s support is intended to contribute to the
development of talents and facilitate students’ education at the highest level. The scholarship is a reward for the effort put into learning and is a
motivation to continue working and achieve even better results. The scholars come from all over Poland. They are particularly talented young people,
but above all they are passionate people who love what they do. The amount of scholarship support is PLN 10,000 in the 2023/2024 school year, paid
out in PLN 1,000 each for 10 months (from September 2023 to June 2024). In the 2023/2024 edition of the Scholarship Programme, 37 scholarship
recipients were selected from among 4,960 application forms.
Number of beneficiaries: 37
The Flame Club
The “Flame Club” is a project run by the Foundation since 2019. Its premise is to renovate and equip rooms according to the needs of children who are in
hospital wards or children’s homes. Facilities that lack rooms for learning, leisure, play or rehabilitation or are in an unsatisfactory technical condition are
eligible for the programme. We work with qualified refurbishment companies to carry out major renovations. Before the work begins, the employees of
the facilities, as well as the children, have a say in the final appearance of the “Flame Club”. In total, the Santander Foundation has renovated 13 rooms,
two of which were refurbished in 2023. The two new units were created at the J. Babiński Specialist Psychiatric Healthcare Complex in Łódź and at the
“In the Park” Home for Children, Olsztyn Children’s Aid Centre. In both cases, kitchens were refurbished and equipped.
Number of beneficiaries: 146
We Will Double Your Impact
This is a joint campaign of the Santander Foundation, the Santander Bank Polska Group, its customers and employees. The charity collection was held
for the fourth time in 2023. Its main objective in 2023 was to raise funds for the development and operation of a chat room run by the Power to the
Children (Dajemy Dzieciom Siłę) Foundation, which operates the national helpline 116 111. Chat is an extremely popular way of communication among
young people. It offers a possibility of an anonymous contact with psychologists for children and young people in mental crisis. The task of the
psychologist contacted is to help solve the young person’s problem. The fundraiser continued throughout June. All contributions to the Santander
Foundation account were matched and doubled. Thanks to the generosity of donors, more than PLN 700,000 was donated to maintain and develop the
operation of the chat helpline.
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Social engagement of employees
Since 2010, Santander Foundation has been promoting corporate volunteering. The Foundation provides merit and financial support to the bank’s
employee-volunteers and recognises their contribution to the development of local communities. Volunteering is carried out in three forms:
time volunteering,
skill-based volunteering,
educational volunteering.
Volunteering is a form of social engagement that helps create positive change in local communities. Volunteering activities benefit both the beneficiaries
and the volunteers themselves. Through volunteering you can develop your skills, make new contacts and enhance your level of empathy and your sense
of belonging to a community.
Number of projects implemented in 2023: 161
Number of employee volunteers registered on the electronic platform at the end of 2023: 2,124.
Amount allocated by the Santander Foundation for volunteering in 2023: PLN 122,300*.
Number of people helped through volunteering activities in 2023: 16,561.
*Data as of 31.12.2023.
> Corporate volunteering by employees in selected Santander Bank Polska Group companies in 2023:
Santander Consumer Bank S.A. Run for New Life - support for Polish transplantology during running events in Wisła and Warsaw
Run for Breath - support for people suffering from cystic fibrosis during the virtual run and the final run in
Zakopane.
Company Run - support for the beneficiaries of the Everest Foundation - purchase of medicines and
rehabilitation of children with psychophysical deficits.
Development workshops for children with Down’s syndrome under the care of the „See Me” foundation.
Santander TFI S.A. Participation of employees in charity runs and donation of financial support by TFI (e.g. Poland Business
Run and the 6TH NORTH REGION HELPS Charitable Run)
Participation in the CSR campaign of the Wealth Management and Insurance Division with a donation of
financial support by TFI - meeting with children from the “Swoboda” Family Support Centre, purchase of
gifts for children, decorating gingerbread cookies and a joint meal.
Santander Factoring sp. z o. o.
Volunteer activities for the Urtica Foundation, including the auction of paintings of children treated in
oncology wards.
Santander Leasing S.A. “Volunteering of the Year' competition - 9 projects in 3 categories: #diverse, #cultural, #healthy, prize - a
total of PLN 15,000 donated to campaigns, among others:
"Reading with heart" - reading books to children in a hospital in Wrocław and Bydgoszcz,
Colourful children's home" - Painting rooms in a children's home,
"Senior Street Art" – two guided street art tours for groups of senior citizens from Poznań,
Workshops in the community self-help home in Mosina,
"Eco Bench” – creation of a garden for the School and Education Centre in Laski,
Mat break for seniors – residents of the Social Welfare Home in Poznań,
"Walking for health" - Walk 2,500 km for a good cause,
"Give a paw and wag your tail" - collection of food and chews for shelter dogs.
Participation in the Poland Business Run - 20 teams, 100 participants, bronze sponsor.
Christmas parcels for the residents of the day care centre in Mielżynie.
Christmas trees for the Wielkopolskie Centrum Pediatrii in Poznań.
Collection of items (food, bedding, blankets) for the shelter in Gaj.
Blood donation with the SME West network.
Expenditures on social and other projects
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Santander Bank Polska S.A.’s expenditures covering the aforementioned social causes and other projects not related to its core business are presented in
the table below.
Santander Bank Polska Group’s expenditures on non-core activities in 2023 2023
Education, including: 6,995,165.30
– Financial education 1,852,982.28
– Climate education 84,390.32
Sport 4,135,058.79
Culture 4,813,889.42
Environmental protection 297,140.00
Charitable activities and statutory activities of foundations/associations, including: 6,049,501.18
– We Will Double Your Impact fundraiser 360,441.57
Industry conferences 2,241,518.34
TOTAL 24,532,273.03
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XIV. Statement of the Management Board
True and fair presentation of the financial statements
To the best of the Management Board’s knowledge, the financial figures for the current and comparative reporting periods presented in the financial
statements included in the “Annual Report of Santander Bank Polska S.A. for 2023” and “Annual Report of Santander Bank Polska Group for 2023” were
prepared in keeping with the applicable accounting policies and give a true and fair view of the state of affairs and earnings of Santander Bank Polska
S.A. and Santander Bank Polska Group. The Management Board’s Report contained in this document shows a true picture of the development,
achievements and position of Santander Bank Polska S.A. and its Group (including the underlying risks) in 2023.
Selection of auditor
The audit firm responsible for auditing the separate and consolidated financial statements of Santander Bank Polska S.A. for 2023 was selected in
compliance with the applicable legislation. The Bank has the “Auditor Appointment Policy at Santander Bank Polska S.A.”, the “Auditor Services Policy at
Santander Bank Polska S.A.” and the “Policy for Non-Audit Services Rendered by the Auditor”, which include, among other things, the policy of selection
of an audit firm and the policy of provision of non-audit services by an audit firm, an affiliate of an audit firm or a member of its network. The Bank
complies with the applicable legal provisions relating to the rotation of audit firms and the key statutory auditor, and the appropriate cooling-off periods.
The following persons have signed this Management Board Report with a qualified electronic signature.
Date Name and surname Position/Function Signature
15.02.2024 Michał Gajewski President of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Andrzej Burliga
Vice President of the Management
Board
Signed with a qualified electronic
signature
15.02.2024 Juan de Porras Aguirre
Vice President of the Management
Board
Signed with a qualified electronic
signature
15.02.2024 Arkadiusz Przybył
Vice President of the Management
Board
Signed with a qualified electronic
signature
15.02.2024 Lech Gałkowski Member of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Artur Głembocki Member of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Patryk Nowakowski Member of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Magdalena Proga-Stępień Member of the Management Board
Signed with a
qualified electronic
signature
15.02.2024 Maciej Reluga Member of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Wojciech Skalski Member of the Management Board
Signed with a qualified electronic
signature
15.02.2024 Dorota Strojkowska Member of the Management Board
Signed with a qualified electronic
signature