Chairman of the Supervisory Board Statement

Maciej Łopiński - Chairman of the PZU Supervisory Board

Dear Stakeholders,

The PZU Group’s strength is rooted in the strength of the Polish economy. 2019 was an exceptionally successful year for the largest financial institution in Central and Eastern Europe and was taken advantage of effectively to build the PZU Group’s future position.

This end is served by the innovative and forward-looking solutions that are gradually being implemented and that are based on modern technologies, including artificial intelligence Chairman of the Supervisory Board Statement to be able to meet the challenges of the future. The ever broader offer that is more and more aligned to client needs is also doing its part. The ever higher quality of services offered not just through the expanding network of traditional branches but also in electronic channels is also doing its part. The social engagement demonstrated by the PZU Group, especially in prevention is building its added value.

The highest net profit since 2010 totaling PLN 3,295 million, the record-breaking gross written premium of PLN 24.2 billion and the high level of solvency at 220% testify to the PZU Group’s excellent condition. This was affirmed in the middle of 2019 when PZU’s rating outlook was raised from stable to positive (rating of A-). When they made that decision, the analysts at S&P Global Ratings highlighted improving risk management practices resulting in greater capital resilience and high capital management discipline. They pointed out PZU’s very good position on the insurance, banking and asset management market, poising it to utilize its advantage to generate robust financial results and improve its position in the overall sector.

The PZU Group’s strength is rooted in the synergy of insurance and banking. New products and growing results are the outcome of the rapid development in bancassurance and assurbanking. The premium collected in collaboration with the banks belonging to the PZU Group was PLN 0.89 billion at the end of 2019, or 160% above the year before, thereby nearly reaching the level not projected to be achieved until 2020. Cost reduction has outpaced the strategic objective planned for 2020 in the amount of PLN 100 million.

The web-based Cash Loan Platform launched in 2019, the fruit of PZU’s cooperation with Alior Bank, is one example of an innovative solution. It gives employees convenient access to quick, inexpensive and safe loans for which they can apply through their employers. In turn, the cash platform allows employers to offer additional benefits to their employees, thereby augmenting their attractiveness on the labor market. This unique business concept also has a social dimension by protecting borrowers who suddenly need money in difficult life circumstances against taking down liabilities on usury terms.

Social engagement as expressed by PZU’s social strategy announced in 2019 under the slogan of #10yearslonger is an important part of the PZU Group’s efforts. It is rooted in prevention, or preventing losses and misfortunes, instead of just providing assistance when something bad happens. This involves a wide spectrum of prevention in safety and health.

Preventive health tests, educational campaigns and social campaigns to enhance safety in road traffic and initiatives such as giving away reflective lights to pedestrians to protect them against accidents on the road and purchasing rescue equipment for fire fighters serve to achieve this purpose.

At the same time, engaging in projects such as creating a stock market index comprising states belonging to the Three Seas’ Initiative under the name of CEEplus is an investment in the future and proof of the PZU Group’s growing international significance. PZU’s contribution to this index involves the launch of a passive fund known as inPZU CEEplus based on this index to promote the region of the Three Seas’ Initiative and attract investors to this region.

2019, which was a successful year for the PZU Group offers promising prospects for the future. It creates opportunities, which will be harnessed in full, of which I am profoundly convinced.

Sincerely,

Maciej Łopiński

PZU Supervisory Board Chairman