Financial and
ESG report 2020

In 2012, the Group implemented a policy specifying the principles of remuneration for persons having a material impact on the risk profile of Bank Millennium Group, as amended, in accordance with the requirements described in Resolution of the Polish Financial Supervision Authority No. 258/2011, and then the Regulation of the Minister of Development and Finance of March 6, 2017 on the risk management system and the internal control system, remuneration policy and the detailed method of internal capital estimation in banks. In accordance with the policy, employees of the Group having a significant impact on the Group’s risk profile receive variable remuneration, part of which is paid in the form of financial instruments: the Bank’s phantom shares in 2017-2018; Bank Millennium own shares: for 2019 and 2020. Commencing from 2019, by the decision of the General Meeting of Bank’s Shareholders of August 27, 2019, the Group introduced an incentive program to remuneration entitled persons previously identified as having a significant impact on the risk profile (Risk Taker). Under this framework, the Own Shares acquired by the Company will be, in accordance with the applicable Risk Taker’s remuneration policy, intended for free acquisition in the appropriate number by the indicated Risk Takers during the Program Term.

Variable remuneration financial instruments for: 2020 2019 2018 2017
Kind of transactions in the light of IFRS 2 Share-based payment transactions Cash-settled share-based payments
Commencement of vesting period 1 January 2020 1 January 2019 1 January 2018 1 January 2017
The date of announcing the program 27 August 2019 30 July 2012
Starting date of the program in accordance with the definition of IFRS 2 Date of the Personnel Committee meeting taking place after closing of financial year
Number of granted  instruments Determined at the grant date of the program in accordance with the definition of IFRS 2
Maturity date 3 years since the date of granting program
Vesting date 31 December 2020 31 December 2019 31 December 2018 31 December 2017
Vesting conditions Employment in the Group 2020, results of the Group and individual performance Employment in the Group 2019, results of the Group and individual performance Employment in the Group 2018, results of the Group and individual performance Employment in the Group 2017, results of the Group and individual performance
Program settlement Programs 2017-2018: on the settlement date, the participant will be paid the amount of cash being equal to the amount of held by a participant phantom shares multiplied by arithmetic mean of the Bank’s share price at the closing of last 10 trading sessions on the Stock Exchange in Warsaw, preceding the settlement date. Aforementioned value cannot be greater or less than 20% compared to the original value of the deferred share pool. Phantom shares are settled in three equal annual instalments starting from the date of the Personnel Committee which decides about assignment.

Programs 2019 – 2020: on the program settlement date, the participant will receive the allocated treasury shares.

Program valuation The fair value of the program is determined at each balance sheet date according to the rules adopted for determining the value of the program on the settlement date

Financial instruments granted to Group’s employees who are not members of the Management Board of the Bank, for the year: 2020 2019 2019 * 2018 2017
own shares phantom shares phantom shares phantom shares
Date of shares assigning 03.07.2020 03.07.2020 23.01.2019 07.02.2018
Number of shares 758 977 90 788 42 505
granted 151 797 0 0
deferred 607 180 90 788 42 505
Value as at assigning date (PLN) 2 418 704 72 000 833 614 406 470
granted 483 746 0 0 0
deferred 1 934 958 72 000 833 614 406 470
Fair value as at 31.12.2020 (PLN) 1 985 478 55 196 666 891 325 176
* Millennium TFI S.A. and Millennium Dom Maklerski S.A. continue to settle their programs on the basis of phantom shares in accordance with the Remuneration Policy of these Group entities.

At the balance sheet date, the Personnel Committee of the Supervisory Board has not taken a decision on the amount of variable remuneration for Group’s employees who are not members of the Management Board of the Bank for 2020.

Financial instruments granted to members of the Management Board of the Bank, for the year: 2020 2019 2018 2017
own shares own shares phantom shares phantom shares
Date of shares assigning 03.07.2020 31.05.2019 09.04.2018
Number of shares 965 862 156 571 91 480
– granted 482 928 0 0
– deferred 482 934 156 571 91 480
Value as at assigning date (PLN) 3 078 000 1 426 347 750 960
– granted 1 539 000 0 0
– deferred 1 539 000 1 426 347 750 960
Fair value as at 31.12.2020 (PLN) 3 128 939 1 028 202 666 706

At the publication date of the Annual Report, the Personnel Committee of the Supervisory Board has not taken a decision on the amount of variable remuneration for the members of the Management Board for 2020.

Payments based on the former euro bank shares

Bank Millennium took over the liabilities of Euro Bank to employees who were identified as having a significant impact on the risk profile and received variable remuneration, part of which was paid in the form of shares of the former Euro Bank in the years preceding the merger. On the day Euro Bank was taken over by Bank Millennium, these shares ceased to exist. Therefore, Bank Millennium adopted by decision of the Supervisory Board the rules of converting nonexistent Euro Bank shares into Bank Millennium shares. In 2021 and 2022, 306,726 and 237,848 shares of Bank Millennium, respectively, remain to be paid out.

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