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ING Bank Śląski S.A. Group has compiled the annual report in line with the best global practices of integrated reporting. To help readers use the interactive tools, we prepared a user guide with key features. We encourage you to watch a short animated video before reading the report.

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Integrated Annual Report
of ING Bank Śląski S.A. 2019

500+ – A governmental Family 500+ programme which warrants regular assistance for parents raising children. The monthly amount of PLN 500 is awarded to the second and every subsequent child in a family.

Add-on – Imposed on the capital requirements in keeping with Regulation No. 575/2013 (CRR).

Agile – It is a new way of working at selected Bank units, adopted from the IT sector. It enables fast response to changing client and market needs.

AIRB –  Advanced Internal Rating-Based – It is a method used to measure credit risk.

Interest assets – Assets earning interest income for the bank; loans granted to clients form their major portion.

ALCO – Asset– Liabilities Committee.

Bank – Bank when capitalised means ING Bank Śląski S.A.

Basel III – Regulations on capital requirements and risk management at credit institutions. The Basel III solutions were introduced in the European Union with Regulation No 575/2013 (CRR) and Directive No 2013/36/EU (CRD IV).

BGF – Bank Guarantee Fund – A deposit guarantee and resolution scheme. BGF guarantee covers deposits being the equivalent of up to EUR 100,000.

BGK – Bank Gospodarstwa Krajowego – a state-owned development bank. The main task of BGK is to support economic development of Poland and improve the quality of life for Poles.

Credit Information Bureau – An institution that processes information on the repayment discipline of liabilities of natural and legal persons.

Supervisory Review and Evaluation – one of the supervisory tools of the Polish Financial Supervision Authority (PFSA). The SREP seeks to identify the volume and nature of risk exposure at banks, evaluate the quality of the risk management process and assess the capital covering the risk associated with bank business and bank governance.

Brexit – A popular name of the process whereby Great Britain is to exit the European Union.

BRRD – Bank Recovery and Resolution Directive of the European Parliament and of the Council establishing a framework for the recovery and resolution of credit institutions and investment firms.

O-SII buffer – Buffer of Other Systemically-Important Institution – an element of macroeconomic supervision of the banking sector. The buffer is imposed on banks of systemic importance on both the standalone and consolidated bases. The buffer takes values from 0% to 2% of the capital requirement.

Capital conservation buffer – An element of macroeconomic supervision of the banking sector. The buffer is imposed on all banks; it has to comprise the top-quality capital (Tier 1) and account for 2.5% of the capital requirement at the maximum. In 2016-2017, it was 1.25%; in 2018, it went up to 1.875%; and in 2019 has increased to 2.5%.

Carbon Disclosure Project (CDP) – CDP is an independent non-profit organisation from London. It encourages companies to reduce the emission of greenhouse gas and foster sustainable usage of water resources.

Compliance – Ensuring observance of laws, norms and standards, and recommendations.

Corporate Finance – A specific finance area dealing with financial, investment and operational decisions taken by companies as well as tools and analyses supporting and helping them in the decision-making process.

CPI – Consumer Price Index that measures changes in the price level of consumer goods and services. The most popular global inflation/deflation index.

CSR – Corporate Social Responsibility.

CVA – Credit Value Adjustment is the difference between the risk-free portfolio value and the true portfolio value that takes into account the possibility of a counterparty’s default.

EAD – Exposure At Default – It is a measure showing bank exposures at client’s default.

EaR – Earnings at Risk – It is a measure showing the maximum potential change in earnings versus the earnings budgeted in the financial plan.

Easy lending – The Bank’s approach to financing the mid and big companies. It covers the option of electronic conclusion of credit agreements and tracking the status of applications filed by clients in the ING Business system.

EBA –  European Banking Authority.

Equator Principles Association – The rules adopted by international financial institutions which set the social and environmental responsibility standards for financial risk management of development projects.

ESR – Environmental and Social Risk.

EWS – Early Warnings Signal – It is a predictive model used to assess the probability of the client’s financial standing deterioration.

Factoring – Purchase by the factor of not past-due receivables of companies (clients) due thereto from business partners (offtakers) under delivery of goods and services.

Fast Track – A simplified lending track in the mid and big companies segment.

FCR – First Call Resolution – It is a contact centre performance evaluation. It checks what volume of problems reported by clients to the contact centre is solved at the first contact.

Own funds – The funds forming Tier 1 capital (encompassing, inter alia, share capital, supplementary capital, reserve capital and retained earnings of previous years) and Tier 2 capital (encompassing inter alia subordinated liabilities, when approved by the competent regulator).

Global Investor Statement on Climate Change – A global arrangement of investors which lays down the manner in which investors can contribute to increasing the number of low-emission and climate-resistant investment projects. The arrangement also provides for practical proposals how to multiply this contribution with adequate government measures.

Global Reporting Initiative (GRI) – An international organisation which publishes non-financial reporting guidelines.

Bank Group – Bank Group when capitalised means the ING Bank Śląski S.A. Group.

Guarantee – A bank guarantee is a written commitment of the bank to pay the amount given there to the beneficiary on the terms and conditions stated therein. The agreement is, however, of securing nature only. It is not a tool to settle commercial agreements.

ICAAP – Internal Capital Adequacy Assessment Process.

ILAAP – Internal Liquidity Adequacy Assessment Process.

IIRC – International Integrated Reporting Council.

PFSA – Polish Financial Supervision Authority – supervises the banking sector as well as the capital, insurance and pension markets, payment institutions and payment services offices, electronic money institutions and the sector of credit unions.

Funding cost – interest cost/ average interest liabilities for 5 subsequent quarters.

Costs of risk – Pursuant to IAS 39: the balance of provisions made and released under impairment of assets, credit facilities and cash loans granted to clients, first and foremost.  Pursuant to IFRS 9: the balance of allowances for credit losses.

KRS – National Court Register.

LCR – Liquidity Coverage Ratio. Computed as a ratio of very liquid assets to short-term liabilities. It is introduced in stages. The minimum value is: 60% in 2014 and 2015, 70% in 2016, 80% in 2017 and 100% starting from 2018.

Leasing – The agreement, whereunder the owner of an assets item (lessor) provides the user (lessee) with the right to use the assets item for a defined period in exchange for payment or a series of payments.

LGD – Loss Given Default – The share of an asset (exposure) that is lost if a borrower defaults.

TCR – Total Capital Ratio – It is computed as the relation of own funds to off-balance sheet assets and liabilities including risk weights; the ratio is calculated in line with Basel III regulations.

CAPI Method – Computer Assisted Personal Interview – an interviewing technique in which the interviewer records the answers of the respondent on mobile devices.

CAWI Method – Computer Assisted Web Interview – an interviewing technique in which the respondent or interviewer uses electronic questionnaires.

MiFID II – Markets in Financial Instruments Directive II.

MREL – Minimum Requirement for own funds and Eligible Liabilities. The institution transposed into Polish law under the Act on the Bank Guarantee Fund, Deposit Guarantee Scheme and Resolution of 10 June 2016.

IAS – International Accounting Standards; gradually superseded by the IFRS, i.e. International Financial Reporting Standards.

IFRS – International Financial Reporting Standards and their interpretations approved by the International Accounting Standards Board.

Mystery Shopper – One of the methods used to score the client service satisfaction where service quality is assessed during client sales and service points visits.

NPL – Non-Performing Loans – “Bad” loans in simple terms; that is loans wherefor clients default on payment or it is highly probable that they will default in the future. Pursuant to IFRS 9 the term covers receivables reflected in Stage 3 and POCI (purchased or originated credit impairment) assets.

NBP – National Bank of Poland – a central bank which acts as the issue bank, the bank of banks and the central state-owned bank.

NPS – Net Promoter Score – a client loyalty survey. Client database is split into three categories: promoters, neutral clients and detractors. NPS ratio is the difference between the share of promoters and detractors in the entire client database.

NSFR – Net Stable Funding Ratio. It is computed as the ratio of available stable funding to required stable funding. In keeping with Regulation No 575/2013 of the European Parliament and of the Council (EU), the target net stable funding ratio (NSFR) was not defined.

OHI – Organizational Health Index.

PACE – An organised process boosting innovations across ING Group. It fosters a fast market launch of new products and services, developed by small and independent scrums.

Interest liabilities – Liabilities generating interest cost for the bank; client deposits form their major portion.

PD – Probability of Default.

GDP – Gross Domestic Product – Aggregated market value of goods and services produced by national and foreign factors in a given country and in a given period.

Bank tax, Bank levy – A popular name of the tax on certain financial institutions. The monthly tax of 0.0366% (0.44% per year) is collected from the value of assets as at the month-end – upon previous deductions. For banks, the value of assets is reduced by the amount of sovereigns held and own funds of a bank and PLN 4 billion, for example. The banks that have launched rehabilitation proceedings and state-owned banks (BGK – Bank Gospodarstwa Krajowego) are exempted from the tax.

Non-Performing Loans Coverage Ratio – NPL Coverage Ratio. The ratio of impairment losses and other client receivables to clients to the value of impaired loans and other receivables to clients. Pursuant to IFRS 9 the ratio of impairment losses reflected in Stage 3 and POCI (purchased or originated credit impairment) assets to the value of such receivables.

RAS – Risk Appetite Statement – The document that sets the maximum risk the Group is willing to accept for a given type of risk.

Credit rating – Evaluation of the ability of a legal entity drawing a loan to repay the debt in full that is to repay interest and principal on the contractual terms and conditions.  The entity can be both a company and a state, for example.

Interest assets profitability – Income under interest/ average interest assets for 5 subsequent quarters.

Respect Index – Index of the most socially responsible companies on the Warsaw Stock Exchange.

MPC – Monetary Policy Council – A body of the National Bank of Poland (NBP). Its tasks include but are not limited to determining the NBP interest rates.

Retail segment – Simply: natural persons and natural persons running business.

Corporate segment – Simply: clients of mid and big companies segments and strategic clients.

STIR – ICT System of the National Clearing House – a set of algorithms that analyse financial data delivered obligatorily by banks and credit unions on entrepreneurs designed to identify potential VAT frauds.

SWIFT – Society For Worldwide Interbank Financial Telecommunication. SWIFT participates in international transactions between financial institutions.

Carbon footprint – The total set of greenhouse gas emissions caused directly or indirectly by an individual, organisation, event or product.

Tier 1 – Top-quality capital, computed in line with Basel III regulations.

United Nations Environment Programme Finance Initiative – A global partnership between the United Nations and over 200 representatives of the world financial sector. The partnership seeks to promote sustainable funding.

United Nations Global Compact – The largest global initiative gathering business striving after sustainable growth.

VaR – Value at Risk – the ratio which defines the anticipated maximum potential loss at certain probability.

WCAG – International guidelines on making Web content more accessible. These guidelines read how to make content accessible to everyone, regardless of one’s ability, age, equipment or software.

WIBOR – Warsaw Interbank Offered Rate – It is a reference interest rate of loans on the Polish interbank market.

WIG 30 – WIG 30 index has been published by the Warsaw Stock Exchange (WSE) since 23 September 2013. It is a capitalization-weighted stock market index of the thirty largest companies on the Warsaw Stock Exchange.

WPC – Winning Performance Culture – It is a survey to measure employee engagement.

NPL Ratio – Non-Performing Loans Ratio – simply: the share of “bad” loans in the gross lending portfolio. Pursuant to IFRS 9 it is the share of receivables reflected in Stage 3 and POCI (purchased or originated credit impairment) assets to the gross lending portfolio.

L/D ratio – Loans/ Deposits ratio – Total net loans and other receivables to customers without Eurobonds/ liabilities to customers.

Risk costs margin ratio – Net loan loss provisions (pursuant to IFRS 9: allowances for expected credit losses) to the average value of the gross lending portfolio in a given period.

Interest margin ratio – Net interest income/ average interest assets for 5 consecutive quarters.

C/I ratio – Cost to Income ratio – The ratio calculated as the relation of the general and administrative expenses (banking tax excluded) to income with the net result of associated entities recognised on an equity basis.

ROA – Return on Assets – net profit/ average assets for 5 subsequent quarters.

ROE – Return on Equity – net profit/ average equity for 5 consecutive quarters.

Tier 1 capital ratio – The ratio of the Tier 1 capital to off-balance sheet assets and liabilities, including risk weights; the ratio is calculated in line with Basel III regulations.

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