Chairman of the Supervisory Board Statement

Dear Stakeholders,

Last year was a period of strong recovery for the global economy, which was triggered by the improving pandemic situation. Progress in rolling out universal vaccination programs translated into lifting more restrictions applicable to various areas of business activity, and this was of significant importance in rebuilding global supply chains and improving the financial condition of many businesses. In 2021 Poland’s GDP climbed 5.7% year on year, household consumption grew 6.2% y/y and investments moved up 7.9% y/y. Economic growth was underpinned by the strong growth in domestic demand supported by government programs and higher household spending. Households accumulated savings during these health-related restrictions. Consumption was supported by the labor market, which rapidly returned to the level seen prior to the pandemic and robust wage growth. The driver of investments was linked to the solid prospects of economic recovery and the high level of manufacturing capacity utilization.

The improvement in market conditions combined with the very successful adaptation of PZU’s business to operating during the pandemic over the last two years contributed to the PZU Group’s performance. The record-breaking gross written premium and the highest net result since PZU SA’s floatation on the Warsaw Stock Exchange confirm the Group’s high operational efficiency and its resilience to economic turmoil, even to the most difficult and least predictable of circumstances. These results are also the outcome of the ongoing diversification of the Group’s business model and sustaining a high level of trust in relations with clients. New digital channels of distribution, products aptly aligned to clients’ evolving needs, extensive utilization of automation and roboticization of processes and hybrid work solutions – all this has become a lasting part of the PZU Group’s corporate culture and enabled it to employ its capital even more effectively in 2021.

The PZU Group is a financial conglomerate operating in various market segments: insurance, banking, investments and health care. The fact that the PZU Group’s products are present in most Polish households and businesses and that in total it has approximately 22 million clients means that it has an enormous capacity to influence its environment and bears equally enormous responsibility ensuing from that position. During the pandemic, thanks to the financing and insurance cover the PZU Group provided to clients’ businesses and investments, Polish companies were able to survive the various lockdowns with greater ease and emerge more quickly from this turbulence. In 2021 they were able to redouble their efforts in terms of their operations and international expansion.

At present, the pandemic threat appears to be softening and shift into an endemic phase, though one cannot preclude the materialization of scenarios that would alter that picture in a more dynamic fashion. However, the social, economic and political consequences of Russia’s aggression against Ukraine will constitute a huge challenge in 2022 – globally and for Poland, which is the country that is the most engaged in providing assistance to Ukrainian nationals displaced by the war. In these circumstances it will be necessary for the PZU Group to maintain flexibility, the ability to adapt and decision-making efficiency, which it has amply demonstrated over the last two years.

Focusing on the current and near-term challenges, one cannot forget about the global challenges that are still of importance and continue to affect us greatly. The PZU Group is playing an ever more important role in actions related to mitigating the unfavorable repercussions of climate change. The PZU Group Strategy adopted in 2021 contains more than just ambitious goals associated with striving to achieve climate neutrality; it also dwells on supporting energy transition. In this field I simultaneously see the PZU Group’s great responsibility and potential to play a crucial role in advancing and backing the Polish economy’s sustainable development.

I wish the management teams of the companies belonging to the PZU Group and all of their employees good luck in cultivating strong and trust-filled relations with clients, achieving all of the intended business and social objectives and generating exceptional rates of return for shareholders.

Respectfully,

Paweł Mucha

PZU Supervisory Board Chairman