In 2013 the following events affecting the structure of the PKO Bank Polski SA Group took place:
1. Changes in the PKO Leasing SA Group
Bankowy Fundusz Leasingowy SA (a subsidiary of the Bank) changed its name to PKO Leasing SA - the change was registered with the National Court Register on 27 March 2013.
Bankowy Leasing Sp. z o.o. (a subsidiary of PKO Leasing SA) changed its name to PKO Bankowy Leasing Sp. z o.o. - the change was registered with the National Court Register on 28 March 2013.
On 19 March 2013 an increase in the share capital of PKO Leasing SA of PLN 20 000 thousand was registered with the National Court Register. As a result of the above mentioned increase, the Company’s share capital amounts to PLN 90 000 thousand and consists of 9 000 000 shares, each of PLN 10 nominal value. All the shares in the increased Company’s share capital were acquired by PKO Bank Polski SA for a price equal to the nominal value of the shares taken up. As a result of the above mentioned transactions PKO Bank Polski SA still remains the sole shareholder of PKO Leasing SA.
PKO Leasing Sverige AB with registered office in Stockholm was registered with the Swedish Register of Businesses on 18 September 2013. Share capital of the Company amounts to EUR 6 thousand and consists of 600 shares at nominal value of EUR 10 each. All shares of the above mentioned Company were taken up by PKO Leasing SA. The Company’s activity is provision of leasing services.
On 19 December 2013 PKO Leasing SA made an additional contribution to PKO Leasing Sverige AB in the amount of EUR 994 thousand (i.e. PLN 4 145 thousand at the average NBP exchange rate as at the date of contribution).
2. Acquisition of a share in the increased share capital of Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o. by PKO Bank Polski SA
An increase in the share capital of Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o. of UAH 484 000 thousand, carried out by increasing the nominal value of the Company’s share and acquired by PKO Bank Polski SA, was registered with the Ukrainian Register of Businesses on 11 September 2013. As a result of the above mentioned increase, share capital of the Company amounts to UAH 530 101 thousand and comprises 1 share with the above mentioned value.
3. Sale of the package of shares in Centrum Elektronicznych Usług Płatniczych eService Sp. z o.o.
On 7 November of 2013 PKO Bank Polski SA entered into an agreement with EVO Payments International Acquisition, GmbH with registered office in Germany (the ‘Investor’), a subsidiary of EVO Payments International LLC with registered office in the United States of America (‘EVO’) and with EVO relating to the acquisition by the Investor shares in the limited liability company which will be incorporated as a result of the transformation of the joint stock Centrum Elektronicznych Usług Płatniczych eService Spółka Akcyjna into a limited liability company (‘the Company’).
In December 2013 the Bank received a decision of the European Commission in which the EC decided not to oppose to the exercise of the joint control over the Company by Bank and by EVO. Also, in December 2013 the Company was transformed into limited liability company.
On 31 December 2013 shares representing 66% of the share capital of the Company. and giving right to 66% of the votes at the General Shareholders Meeting of the Company, were transferred to the Investor.
At the same time the following agreements were executed and entered in force as of 31 December 2013:
- a shareholders’ agreement governing the rules of cooperation, including decision making, by the Bank, the Investor and the Company in connection with the equity interests held by the shareholders,
- an alliance agreement setting forth the rules for business cooperation, between the Bank and the Company.
As at 31 December 2013 Bank holds shares of above mentioned Company constituting 34% of the Company’s share capital which entitles to 34% of the votes at General Shareholders’ Meeting. Due to the Bank beginning to hold joint control of the Company, the Company became jointly controlled entity of PKO Bank Polski SA.
Net income from sale transaction was presented in Note 9 ‘Other operating income and expense’.
4. Capital contribution to KREDOBANK SA by providing financial donation
On 29 November 2013 PKO Bank Polski SA has made a capital contribution to KREDOBANK SA by providing financial donation in the amount of USD 20 681 thousand (i.e. PLN 63 793 thousand according to the average NBP exchange rate as at the date of funds transfer).
Above mentioned donation increases the purchase price in the statement of financial position of PKO Bank Polski SA.
5. Acquisition of the investment certificates
In October 2013 PKO Bank Polski SA acquired 12 000 000 units of investment certificates in the Mercury Fund – the non-public asset closed investment fund with the total value of PLN 120 000 thousand. The above mentioned Fund is managed by PKO TFI SA.
The principal activity of the Fund is to invest funds collected through non-public offering of investment certificates in securities, money market instruments and other property rights set out in the Memorandum of Association of the Fund and in the Investment Funds Act. The Fund conducts investment activity through 8 commercial companies.
As at 31 December 2013, the Fund and 8 companies of the Fund, as entities controlled by PKO Bank Polski SA, are fully consolidated in the financial statements of the PKO Bank Polski SA Group.
6. Changes to the Qualia Development Sp. z o.o. Group
- concerning Qualia Development Sp. z o.o.
a) An increase in the share capital of Qualia Development Sp. z o.o. of PLN 20 348 thousand was registered with the National Court Register on 24 September 2013. Shares in the increased share capital of the Company were acquired by PKO Bank Polski SA and paid for in cash.
b) An increase in the share capital of Qualia Development Sp. z o.o. of PLN 215 460 thousand was registered with the National Court Register on 20 December 2013. Shares in the increased share capital were fully paid in cash contributed by offsetting amounts due from PKO Bank Polski SA to Qualia Development Sp. z o.o. for the reimbursement of capital contribution made in the Company by the Bank in the total amount of PLN 215 460 thousand.
c) On 20 December 2013, the Extraordinary General Shareholders’ Meeting of Qualia Development Sp. z o.o. passed a resolution on share capital increase of Qualia Development Sp. z o.o. of PLN 106 800 thousand by issuing new shares. Shares in the increased share capital were fully covered by non-cash contribution in the form of 77 474 shares of Fort Mokotów Inwestycje Sp. z o.o. owned by PKO Bank Polski SA. The above-mentioned increase requires registration with the National Court Register.
According to resolution on share capital increase from 20 December 2013, the share capital of Qualia Development Sp. z o.o. amounts to
PLN 347 108 thousand and consists of 694 215 shares, each of PLN 500 nominal value.
As at 31 December 2013 PKO Bank Polski SA is the sole shareholder of the Company.
- concerning Fort Mokotów Inwestycje Sp. z o.o.
d) On 19 April 2013 an increase in the share capital of Fort Mokotów Inwestycje Sp. z o.o. of PLN 4 194 thousand was registered with the National Court Register. As a result of the above mentioned increase, the share capital of the Company amounts to PLN 77 483 thousand and consists of 77 483 shares, each of PLN 1 thousand nominal value.
PKO Bank Polski SA acquired 4 193 shares with the total nominal value of PLN 4 193 thousand, and Qualia Development Sp. z o.o. acquired 1 share in the increased share capital.
e) On 20 December 2013 Qualia Development Sp. z o.o. concluded an agreement with PKO Bank Polski SA, according to which all shares of Fort Mokotów Inwestycje Sp. z o.o. held by the Bank were transferred to Qualia Development Sp. z o.o. in exchange for acquisition of shares in the increased share capital of Qualia Development Sp. z o.o. The transfer of shares ownership was effective on 31 December 2013.
As a result of the above mentioned transaction, since 31 December 2013 Qualia Development Sp. z o.o. is the sole shareholder of Fort Mokotów Inwestycje Sp. z o.o. (the change was registered with the National Court Register on 3 February 2014).
- concerning Qualia spółka z ograniczoną odpowiedzialnością – Zakopane Sp. k.
f) By the Partners’ Resolution of Qualia spółka z ograniczoną odpowiedzialnością - Zakopane Sp. k. the amount of limited partner’s (Qualia Development Sp. z o.o.) contribution and the limited partnership amount was increased from PLN 1 thousand to PLN 1 139 thousand (including the increase to the amount of PLN 441 thousand by the resolution of 17 January 2013 and to the amount of PLN 1 139 thousand by the resolution of 17 October 2013). The above mentioned changes were registered with the National Court Register on 13 February and on 29 November 2013.
- concerning Qualia spółka z ograniczoną odpowiedzialnością – Jurata Sp. k.
g) On 17 January 2013 by the Partners’ Resolution of Qualia spółka z ograniczoną odpowiedzialnością - Jurata Sp. k. the amount of limited partner’s contribution (Qualia Development Sp. z o.o.) and the limited partnership amount was increased from PLN 1 thousand to
PLN 2 551 thousand. The above mentioned changes were registered with the National Court Register on 13 February 2013.
- concerning Sarnia Dolina Sp. z o.o.
h) On 12 April 2013 all the terms and conditions of the agreement relating to the purchase of 44% of shares in the share capital of Sarnia Dolina Sp. z o.o. by Qualia Development Sp. z o.o. from Przedsiębiorstwo Robót Inżynieryjnych ‘Pol-Aqua’ SA were met;: thus Qualia Development Sp. z o.o. became the sole shareholder of Sarnia Dolina Sp. z o.o. The above mentioned change was registered with the National Court Register on 16 May 2013.
i) On 16 May 2013 an increase in the share capital of Sarnia Dolina Sp. z o.o. of PLN 6 924 thousand was registered with the National Court Register. As a result of the above mentioned increase, the share capital of the Company amounts to PLN 6 974 thousand and consists of 13 948 shares, each of PLN 500 nominal value. The shares in the increased Company’s share capital were acquired by Qualia Development Sp. z o.o.
- concerning Giełda Nieruchomości Wartościowych Sp. z o.o.
j) On 17 April 2013 Giełda Nieruchomości Wartościowych Sp. z o.o. was registered with the National Court Register. The Company’s share capital amounts to PLN 5 thousand and consists of 100 shares each of PLN 50 nominal value. On the day of issuance ; shares in the Company with a nominal value of PLN 4 950 thousand were taken up by Qualia Development Sp. z o.o., and 1 share with a nominal value of PLN 50 was taken up by Qualia Sp. z o.o. As of 17 October 2013 the sole shareholder of the Company is Qualia Development Sp. z o.o., which bought 1 share with a price equal to the nominal value of the share.
- concerning Qualia – Rezydencja Flotylla Sp. z o.o.
k) An increase in the share capital of Qualia – Rezydencja Flotylla Sp. z o.o. of PLN 9 026 thousand was registered with the National Court Register on 24 September 2013. As a result of the above mentioned increase, the share capital of the Company amounts to PLN 11 526 thousand and is divided into 11 526 shares at nominal value of PLN 1 thousand each.
In 2013 Qualia Development Sp. z o.o. made an additional contribution to Qualia - Residence Sp. z o.o. in the total amount of PLN 3 127 thousand and made an additional contribution to Sarnia Dolina Sp. z o.o. in the total amount of PLN 18 750 thousand.
7. Reclassification of shares to non-current assets held for sale
In December 2013, PKO Bank Polski SA reclassified, in accordance with IFRS 5, shares in Finansowa Kompania ‘Prywatne Inwestycje’ Sp. z o.o. and in ‘Inter-Risk Ukraina’ Additional Liability Company to the position ‘Non-current assets held for sale’ - the Bank intends to recover the value of the above mentioned shares through a sale transaction.
8. Events, which will result in changes in the PKO Bank Polski SA Group in the following quarters
a) On 12 June 2013 PKO Bank Polski SA and Nordea Bank AB (publ) signed an agreement setting out the terms of an acquisition from Nordea Bank AB (publ) and other entities from the Nordea Group of:
- shares of Nordea Bank Polska SA representing 99.21% of the Company’s share capital together with a portfolio of corporate loans to customers of Nordea Bank AB (publ),
- shares of Nordea Polska Towarzystwo Ubezpieczeń na Życie SA representing 100% of the Company’s share capital,
- shares of Nordea Finance Polska SA representing 100% of the Company’s share capital.
Detailed information regarding above mentioned agreement is included in Note 45.1.
b) On 9 October 2013 the National Court Register received a request to amend the Memorandum of Association of CENTRUM HAFFNERA Sp. z o.o. (the entity jointly controlled by the Bank) in terms of reduction of the share capital through redemption of shares owned by the Shareholder – the City of Sopot. On 20 January 2014 the National Court Register registered the above mentioned reduction of the share capital and since 20 January 2014 CENTRUM HAFFNERA Sp. z o.o. became a subsidiary of PKO Bank Polski SA.
In 2013, the following events concerning jointly controlled entities and associates took place.
9. Changes to the CENTRUM HAFFNERA Sp. z o.o. Group
On 1 June 2013 the liquidation of Kamienica Morska Sp. z o.o. (a subsidiary of CENTRUM HAFFNERA Sp. z o.o.) in connection with the completion of the project was commenced. On 24 January 2014 the Company was removed from the National Court Register.
On 1 December 2013 the liquidation of Centrum Majkowskiego Sp. z o.o. (a subsidiary of CENTRUM HAFFNERA Sp. z o.o) in connection with the completion of the project was commenced.
10. The sale of Kolej Gondolowa Jaworzyna Krynicka SA’s shares
On 24 September 2013, PKO Bank Polski SA sold the entire block of shares of Kolej Gondolowa Jaworzyna Krynicka SA (an associate of the Bank) to Polskie Koleje Górskie SA. These shares were recognised as non-current assets held for sale.
11. The sale of shares of Agencja Inwestycyjna CORP-SA SA’s shares
On 31 October 2013 PKO Bank Polski SA sold its entire block of shares of Agencja Inwestycyjna CORP-SA SA (an associate of the Bank). These shares were recognised as non-current assets held for sale.
45.1. Acquisition of the Nordea Bank AB (publ) Group entities by PKO Bank Polski SA
On 12 June 2013 PKO Bank Polski SA concluded an agreement with Nordea Bank AB (publ) (‘Agreement’), a company registered in Sweden, which determined the terms and conditions of the acquisition from Nordea Bank AB (publ) and other Nordea Group entities:
1. Nordea Bank Polska SA
The subject of the transaction is the acquisition of 55 061 403 shares of the Company, with a nominal value of PLN 5 each, constituting 99.21% of the share capital of the Company, through a public tender offer for a sale of shares. The price of shares determined in the Agreement is PLN 2 642 million and will be adjusted with respect to the results of Nordea Bank Polska SA.
2. Nordea Polska Towarzystwo Ubezpieczeń na Życie SA
The subject of the transaction is the acquisition of 1 725 329 shares of the Company, with a nominal value of PLN 111.59 each, constituting 100% of the share capital of the Company. The price of shares determined in the Agreement is PLN 180 million and will be adjusted with respect to the results of Nordea Polska Towarzystwo Ubezpieczeń na Życie SA.
3. Nordea Finance Polska SA
The subject of the transaction is the acquisition of 4 100 000 shares of the Company, with a nominal value of PLN 1 each, constituting 100% of the share capital of the Company. The price of shares determined in the Agreement is PLN 8 million and will not be adjusted.
The Agreement also concerns the acquisition of the portfolio of dues to corporate clients of Nordea Bank AB (publ) with a nominal value of PLN 3 604 million as at 31 December 2012.
One of the elements of the above transaction (‘the Transaction’) is continued financing of mortgage loan portfolios granted by Nordea Bank Polska SA (‘the Mortgage Loan Portfolios’) by the Nordea Group. The financing will be ensured by Nordea Bank AB (publ) granting PKO Bank Polski SA
a credit facility up to: CHF 3 869.4 million, EUR 501.0 million and USD 4.5 million for a period not exceeding 7 years, with a three-year grace period (‘the Credit Facility’). The Credit Facility agreement is to be concluded by Nordea Bank AB (publ) and PKO Bank Polski SA as at the date of closing the Transaction. The Credit Facility is to be secured by a transfer to secure the dues in respect of the Mortgage Loan Portfolio on behalf of Nordea Bank AB (publ) by Nordea Bank Polska SA. The average effective margin in the maximum financing period under the Credit Facility is 63 b.p. above the relevant reference rate. The Credit Facility does not provide for commission on granting the financing.
PKO Bank Polski SA will re-lend the funds acquired under the Credit Facility to Nordea Bank Polska SA in the form of a push-down credit facility up to the amount of: CHF 3 869.4 million, EUR 501.0 million and USD 4.5 million for a period not exceeding 7 years, with a three-year grace period. The push-down credit facility will not be secured. Financial terms and conditions of the above mentioned credit facility (lending margin, commission) are determined at market conditions.
Moreover, under the Transaction the Nordea Group committed to participate in the risk of impairment of the Mortgage Loan Portfolio on the terms and conditions specified in the agreement relating to dividing the credit risk, which will be signed by Nordea Bank AB (publ) and PKO Bank Polski SA as at the transaction closing date (‘the Risk-Sharing Agreement’). In accordance with the Risk-Sharing Agreement, Nordea Bank AB (publ) will incur 50% of excess costs of Mortgage Loan Portfolio risk over the annual level of risk costs determined at 40 b.p. per each year of the four years of the term of the Risk-Sharing Agreement for a period of four years after the closing of the Transaction.
Nordea Bank AB (publ) also commits to maintain the subordinated loans granted to Nordea Bank Polska SA of CHF 68.0 million and CHF 224.0 million, which mature in 2019 and 2022 respectively (‘the Subordinated loans’). In accordance with the Agreement both the Subordinated Loans are to be repaid 5 years before the maturity specified in respective Subordinated Loans Agreements, on condition that appropriate regulatory consents required for each repayment are obtained.
Moreover, under the Transaction, Nordea Bank AB (publ) committed to cause that Nordea Bank Polska SA will offer to PKO Bank Polski SA, as at the date of closing the Transaction, subscription warrants authorising PKO Bank Polski SA to take up the new issue shares of Nordea Bank Polska SA (‘the New Shares’) at the issue price reflecting the price offered in the public tender offer for Nordea Bank Polska SA shares. The objective of taking up the New Shares by PKO Bank Polski SA is to ensure the Bank’s appropriate capital adequacy ratio in connection with the Transaction.
Closing of the Transaction is dependent on the closing terms and condition specified in the Agreement (conditions precedent), which include specifically:
- obtaining the consent of the President of the Competition and Consumer Protection Office by PKO Bank Polski SA to take control over Nordea Bank Polska SA, Nordea Polska Towarzystwo Ubezpieczeń na Życie SA and Nordea Finance Polska SA,
- obtaining the consent of the Ukrainian Antimonopoly Committee (Antymonopolnyj Komitet Ukrainy) by PKO Bank Polski SA to take control over Nordea Bank Polska SA, Nordea Polska Towarzystwo Ubezpieczeń na Życie SA and Nordea Finance Polska SA,
- the Polish Financial Supervision Authority issuing a decision on determining no grounds for vetoing the acquisition of
Nordea Bank Polska SA’s shares and Nordea Polska Towarzystwo Ubezpieczeń na Życie SA’s shares by PKO Bank Polski SA in amounts ensuring share exceeding 50% in the share capital and total number of votes at General Shareholders’ Meetings of those companies, - providing IT services by the Nordea Group under an outsourcing agreement so as to ensure the safe operation of Nordea Bank Polska SA in the period preceding migration to IT systems of PKO Bank Polski SA,
- registering the conditional capital increase of Nordea Bank Polska SA by the relevant registration court so as to enable PKO Bank Polski SA to take up the New Shares.
PKO Bank Polski SA intends – after closing the transaction – to repurchase shares from other minority shareholders of Nordea Bank Polska SA to acquire the remaining shares of Nordea Bank Polska SA and to undertake the necessary actions to abolish the dematerialisation of the shares and to withdraw the shares of Nordea Bank Polska SA from trading in the regulated market maintained by the Warsaw Stock Exchange, and to merge Nordea Bank Polska SA with PKO Bank Polski SA by transferring all the assets of Nordea Bank Polska SA to PKO Bank Polski SA (merger by acquisition).
As part of the work related to implementation of the agreement of the share purchase of entities: Nordea Bank Polska SA, Nordea Polska Towarzystwo Ubezpieczeń na Życie SA and Nordea Finance Polska SA:
- PKO Bank Polski SA submitted applications to the Competition and Consumer Protection Office (11 July 2013), the Polish Financial Supervision Authority (11 July 2013) and the Ukrainian Antimonopoly Committee (12 July 2013),
- on 8 August 2013, the Extraordinary General Shareholders’ Meeting of Nordea Bank Polska SA passed a resolution i.a.:
- on the single issue of 20 million registered subscription warrants of A series entitling its holder to take up, on terms specified in the resolution, a total of not more than 20 million registered ordinary shares of N series of this Bank at total nominal value of PLN 100 million and a conditional increase of share capital of Nordea Bank Polska SA by an amount not higher than PLN 100 million through the issue of N series shares to grant rights to take up shares of this series for holders of subscription warrants that will be issued pursuant to this Resolution: entitled to take up subscription warrants of A series will be only the entity on whose demand to subscribe for sale of Nordea Bank Polska SA shares, shareholders of this Bank, holding not less than 99% of votes at the General Shareholders’ Meeting (Resolution No. 3) will answer,
- on the conditional appointment to the Supervisory Board of Nordea Bank Polska SA of the representatives of PKO Bank Polski SA: Zbigniew Jagiełło, Jakub Papierski, Bartosz Drabikowski, Piotr Alicki, Paweł Borys and Jarosław Orlikowski, with effect at 12.00 AM on the last day call for subscribe for sale of shares of the above mentioned Bank, announced by PKO Bank Polski SA (Resolution No. 2),
- on 6 September 2013, PKO Bank Polski SA obtained a clearance from the Ukrainian Antimonopoly Committee (Antymonopolnyj Komitet Ukrainy) to take control over above mentioned Companies,
- on 15 October 2013, PKO Bank Polski SA obtained a clearance from the President of the Competition and Consumer Protection Office to carry out a concentration involving the PKO Bank Polski SA taking control over above mentioned Companies.
- on 21 November 2013, a registration of nominal value of a conditional increase of share capital of Nordea Bank Polska SA in the amount of
PLN 100 million, in accordance with Resolution No. 3 of the Extraordinary General Shareholders’ Meeting of the Company dated 8 August 2013.
Moreover, PKO Bank Polski SA submitted twice- through the Brokerage House of PKO Bank Polski SA, to Polish Financial Supervision Authority, Warsaw Stock Exchange and Polish Press Agency, the content of the public tender offer for the sale of 55 498 700 shares in Nordea Bank Polska SA with a registered office in Gdynia, representing 100 % votes at the General Shareholders’ Meeting of this entity. The first Public Tender Offer was submitted on 19 June 2013, and the repeated public tender offer – on 3 December 2013.
Public Tender Offers were announced pursuant to Art. 74.1 of the Act on Public Offering in connection with the agreement relating to the acquisition by the Bank of 99.21% of the shares in Nordea Bank Polska SA from Nordea Bank AB (publ).
Information regarding the Transaction and the first and repeated announcement of a public tender offer were communicated in current reports (respectively No. 37/2013 of 12 June 2013, No. 40/2013 of 19 June 2013 and No. 84/2013 of 3 December 2013).
The Transaction is in line with the strategy of PKO Bank Polski SA for the years 2013-2015 and is aimed at strengthening the position of PKO Bank Polski SA as the leader of the Polish banking sector, extending the distribution channels and improving service quality. As a result of executing this transaction, the Bank will significantly improve its position in the private banking segment, enhance its competences in the corporate banking segment and ensure growth in the area of bancassurance.