2.4 Non-controlling interest
2.4.1. Accounting policy
Non-controlling interests constitute that part of capital in a subsidiary that is not directly or indirectly attributable to the parent company. As at the date of acquisition of control, non-controlling interests are measured at the at the non-controlling interest’s proportionate share in the fair value of the subsidiary’s identifiable net assets. As at the subsequent balance sheet dates, the value of non-controlling interests is updated by the value of comprehensive income attributable to non-controlling interests.
2.4.2. Quantitative data
The table below presents subsidiaries with certain non-controlling interest (at present or in the past):
| Name of the entity | 31 December 2021 | 31 December 2020 |
| Pekao 1) | 79.98% | 79.98% |
| Alior Bank 2) | 68.07% | 68.07% |
| Przedsiębiorstwo Usług Medycznych PROELMED sp. z o.o. | 43.00% | 43.00% |
| Sanatorium Uzdrowiskowe „Krystynka” sp. z o.o. | 0.91% | 0.91% |
| UAB PZU Lietuva Gyvybes Draudimas | 0.66% | 0.66% |
| Balta | 0.00% 3) | 0.0051% |
1) As a result, PZU also holds non-controlling interests in Pekao’s subsidiaries listed in the table in section 2.2.
2) As a result, PZU also holds non-controlling interests in Alior Bank’s subsidiaries listed in the table in section 2.2.
3) After the share purchase transactions from minority shareholders in 2021, only one minority shareholder remains in Balta with 1 share.
| Carrying amount of non-controlling interests | 31 December 2021 | 31 December 2020 |
| Pekao Group | 19 028 | 20 329 |
| Alior Bank Group | 3 885 | 4 296 |
| Other | 1 | 1 |
| Total | 22 914 | 24 626 |
Both Pekao and Alior Bank conduct operations primarily in the territory of Poland. Presented below is condensed financial information for the Pekao Group and the Alior Bank Group included in the consolidated financial statements (without consolidation eliminations). The data of the Pekao Group and the Alior Bank Group incorporate the effect of adjustments resulting from the measurement of assets and liabilities to fair value as at the date control was acquired and their subsequent amortization over time.
| Assets | Pekao Group | Alior Bank Group | ||
| 31 December 2021 | 31 December 2020 (restated) |
31 December 2021 | 31 December 2020 (restated) |
|
| Goodwill | 693 | 692 | - | - |
| Intangible assets | 2 129 | 1 938 | 426 | 424 |
| Deferred tax assets | 1 650 | 1 251 | 1 352 | 1 217 |
| Other assets | 52 | 53 | 39 | 44 |
| Property, plant and equipment | 1 979 | 2 098 | 755 | 702 |
| Entities measured by the equity method | 44 | - | - | 5 |
| Assets securing liabilities | 846 | 743 | 131 | 446 |
| Assets held for sale | 14 | 53 | - | - |
| Loan receivables from clients | 156 692 | 141 332 | 57 907 | 55 783 |
| Financial derivatives | 8 007 | 5 591 | 272 | 717 |
| Investment financial assets | 69 781 | 72 373 | 15 992 | 15 591 |
| Measured at amortized cost | 46 736 | 28 569 | 6 578 | 8 395 |
| Measured at fair value through other comprehensive income | 22 372 | 42 781 | 9 265 | 6 984 |
| Measured at fair value through profit or loss | 673 | 1 023 | 149 | 212 |
| Receivables | 3 653 | 2 305 | 2 215 | 1 106 |
| Cash and cash equivalents | 4 967 | 4 727 | 3 748 | 2 359 |
| Total assets | 250 507 | 233 156 | 82 837 | 78 394 |
| Equity and liabilities | Pekao Group | Alior Bank Group | ||
| 31 December 2021 | 31 December 2020 | 31 December 2021 | 31 December 2020 | |
| Equity | ||||
| Equity attributable to equity holders of the Parent | 23 791 | 25 417 | 5 708 | 6 311 |
| Share capital | 263 | 262 | 1 306 | 1 306 |
| Other capital | 19 402 | 22 092 | 4 658 | 5 776 |
| Retained earnings | 4 126 | 3 063 | -256 | -771 |
| Non-controlling interest | 12 | 11 | - | - |
| Total equity | 23 803 | 25 428 | 5 708 | 6 311 |
| Liabilities | ||||
| Subordinated liabilities | 2 761 | 2 758 | 1 347 | 1 793 |
| Liabilities on the issue of own debt securities | 5 356 | 6 152 | 584 | 1 380 |
| Liabilities to banks | 7 040 | 9 165 | 462 | 619 |
| Liabilities to clients under deposits | 194 260 | 177 006 | 71 489 | 65 680 |
| Derivatives | 10 191 | 5 690 | 1 224 | 479 |
| Other liabilities | 6 240 | 5 908 | 1 732 | 1 794 |
| Provisions | 831 | 938 | 290 | 337 |
| Deferred tax liability | 25 | 28 | 1 | 1 |
| Liabilities related directly to assets classified as held for sale | - | 83 | - | - |
| Total liabilities | 226 704 | 207 728 | 77 129 | 72 083 |
| Total equity and liabilities | 250 507 | 233 156 | 82 837 | 78 394 |
| Consolidated profit and loss account for the period from 1 January to 31 December 2021 |
PZU Group | Elimination of Pekao’s data | Elimination of Alior Bank’s data | Elimination of consolidation adjustments | PZU Group without Pekao and Alior Bank |
| Gross written premiums | 25 080 | - | - | 39 | 25 119 |
| Reinsurers’ share in gross written premium | -1 300 | - | - | - | -1 300 |
| Net written premiums | 23 780 | - | - | 39 | 23 819 |
| Movement in net provision for unearned premiums | -548 | - | - | -6 | -554 |
| Net earned premiums | 23 232 | - | - | 33 | 23 265 |
| Revenue from commissions and fees | 4 738 | -3 230 | -1 397 | 157 | 268 |
| Interest income calculated using the effective interest rate | 9 782 | -5 702 | -2 883 | 133 | 1 330 |
| Other net investment income | 418 | -424 | 195 | -5 | 184 |
| Result on derecognition of financial instruments and investments | 407 | -41 | -27 | - | 339 |
| Movement in allowances for expected credit losses and impairment losses on financial instruments | -1 849 | 785 | 1 049 | - | -15 |
| Net movement in fair value of assets and liabilities measured at fair value | 797 | -39 | -410 | - | 348 |
| Other operating income | 1 602 | -285 | -192 | 68 | 1 193 |
| Claims, benefits and movement in technical provisions | -16 130 | - | - | -1 | -16 131 |
| Reinsurers’ share in claims, benefits and movement in technical provisions | 399 | - | - | - | 399 |
| Net insurance claims and benefits | -15 731 | - | - | -1 | -15 732 |
| Fee and commission expenses | -1 194 | 550 | 651 | -8 | -1 |
| Interest expenses | -418 | 205 | 167 | -16 | -62 |
| Acquisition expenses | -3 572 | - | - | -153 | -3 725 |
| Administrative expenses | -6 826 | 3 634 | 1 458 | -139 | -1 873 |
| Other operating expenses | -3 917 | 1 538 | 564 | -69 | -1 884 |
| Operating profit (loss) | 7 469 | -3 009 | -825 | - | 3 635 |
| Share of the net financial results of entities measured by the equity method | -15 | -2 | - | - | -17 |
| Profit (loss) before tax | 7 454 | -3 011 | -825 | - | 3 618 |
| Income tax | -2 020 | 828 | 306 | - | -886 |
| Net profit (loss) | 5 434 | -2 183 | -519 | - | 2 732 |
| Consolidated profit and loss account for the period from 1 January to 31 December 2020 |
PZU Group | Elimination of Pekao’s data | Elimination of Alior Bank’s data | Elimination of consolidation adjustments | PZU Group without Pekao and Alior Bank |
| Gross written premiums | 23 866 | - | - | 24 | 23 890 |
| Reinsurers’ share in gross written premium | -1 016 | - | - | - | -1 016 |
| Net written premiums | 22 850 | - | - | 24 | 22 874 |
| Movement in net provision for unearned premiums | 174 | - | - | 1 | 175 |
| Net earned premiums | 23 024 | - | - | 25 | 23 049 |
| Revenue from commissions and fees | 4 197 | -2 884 | -1 160 | 97 | 250 |
| Interest income calculated using the effective interest rate | 10 262 | -5 761 | -3 201 | 78 | 1 378 |
| Other net investment income | 586 | -234 | -133 | 5 | 224 |
| Result on derecognition of financial instruments and investments | 111 | -124 | -80 | - | -93 |
| Movement in allowances for expected credit losses and impairment losses on financial instruments | -3 342 | 1 620 | 1 736 | - | 14 |
| Net movement in fair value of assets and liabilities measured at fair value | 869 | -133 | -63 | - | 673 |
| Other operating income | 1 395 | -175 | -166 | 59 | 1 113 |
| Claims, benefits and movement in technical provisions | -16 105 | - | - | -9 | -16 114 |
| Reinsurers’ share in claims, benefits and movement in technical provisions | 525 | - | - | - | 525 |
| Net insurance claims and benefits | -15 580 | - | - | -9 | -15 589 |
| Fee and commission expenses | -1 031 | 481 | 555 | -5 | - |
| Interest expenses | -1 134 | 638 | 427 | -17 | -86 |
| Acquisition expenses | -3 317 | - | - | -136 | -3 453 |
| Administrative expenses | -6 597 | 3 288 | 1 508 | -36 | -1 837 |
| Other operating expenses | -5 385 | 1 616 | 827 | 1 240 | -1 702 |
| Operating profit (loss) | 4 058 | -1 668 | 250 | 1 301 | 3 941 |
| Share of the net financial results of entities measured by the equity method | - | - | - | - | - |
| Profit (loss) before tax | 4 058 | -1 668 | 250 | 1 301 | 3 941 |
| Income tax | -1 528 | 612 | 81 | - | -835 |
| Net profit (loss) | 2 530 | -1 056 | 331 | 1 301 | 3 106 |
| Statement of comprehensive income | Pekao Group | Alior Bank Group | ||
| 1 January – 31 December 2021 |
1 January – 31 December 2020 |
1 January – 31 December 2021 |
1 January – 31 December 2020 |
|
| Net profit | 2 183 | 1 056 | 519 | -331 |
| Other comprehensive income | -2 966 | 1 001 | -1 122 | 139 |
| Subject to subsequent transfer to profit or loss | -3 012 | 939 | -1 150 | 135 |
| Valuation of debt instruments | -1 226 | 550 | -92 | 20 |
| Measurement of loan receivables from clients | -38 | 17 | - | - |
| Net cash flow hedges | -1 748 | 372 | -1 060 | 115 |
| Foreign exchange translation differences | - | - | 2 | - |
| Not to be transferred to profit or loss in the future | 46 | 62 | 28 | 4 |
| Valuation of equity instruments measured at fair value through other comprehensive income | 7 | 71 | 28 | 6 |
| Actuarial gains and losses related to employee provisions | 39 | -9 | - | -2 |
| Total net comprehensive income | -783 | 2 057 | -603 | -192 |
| Cash flow statement | Pekao Group | Alior Bank Group | ||
| 1 January – 31 December 2021 |
1 January – 31 December 2020 |
1 January – 31 December 2021 |
1 January – 31 December 2020 |
|
| Net cash flows from operating activities | 1 848 | 23 573 | 3 377 | 2 776 |
| Net cash flows from investing activities | 1 751 | -25 025 | -479 | -71 |
| Net cash flows from financing activities | -3 379 | 624 | -1 546 | -1 691 |
| Total net cash flows | 220 | -828 | 1 352 | 1 014 |
| Dividend-related information | Pekao Group | Alior Bank Group | ||
| 1 January – 31 December 2021 |
1 January – 31 December 2020 |
1 January – 31 December 2021 |
1 January – 31 December 2020 |
|
| Date of ratifying the dividend | 11 June 2021 | - | - | - |
| Record date | 10 September 2021 | - | - | - |
| Dividend payment date | 29 September 2021 | - | - | - |
| Dividend per share (PLN) | 3.21 | - | - | - |
| Dividend due to the PZU Group | 169 | - | - | - |
| Dividend due to non-controlling shareholders | 674 | - | - | - |