Actions and Resources Related to Climate Policy [E1-3]

Due to our nature as a financial institution, the Bank’s capital expenditures (CAPEX) and operating expenses (OPEX), in accordance with the provisions of Commission Delegated Regulation (EU) 2021/2178 of 6 July 2021, are not subject to assessment in terms of eligibility or compliance with the sustainability criteria of the EU Taxonomy (including the application of nature-based solutions, engineering, or dedicated technological solutions). The expenditures and investments incurred in relation to our own operations during the period covered by the ESG Strategy are also financially insignificant from the perspective of the unit’s operations. We apply a prudent approach to avoid misclassification risks, greenwashing, and the inability to directly link expenditures to the implementation of climate policy objectives and directions. Consequently, we do not identify any significant activities in the area of own operations. If we can reliably identify relevant actions and related expenditures, we will disclose the appropriate amounts in subsequent years

In 2024, we maintained strategic initiatives aligned with the Bank’s long-term objectives of reducing negative climate impact and supporting adaptation processes in our locations. The most notable initiatives included:

• Gradual replacement of older lighting systems with energy-efficient LED lighting;
• Energy consumption optimisation (reducing contracted power levels);
• Replacement of uninterruptible power supplies (UPS) with new, more efficient models;
• Decommissioning of unnecessary emergency power connections;
• Installation of energy-efficient air conditioning systems;
• Analyses for the installation of reactive power compensation devices (to eliminate unnecessary energy expenditures);
• Switching electronic devices to standby mode in the evening hours;
• Installation of water pressure reducers or aerators and replacement of household appliances with new, energy-efficient models.

In 2024, we signed a one-year contract for the purchase of electricity, alongside the purchase of guarantees of origin for the entire contracted volume from renewable energy sources. We also received Certificate RGP_ENERGAOB_2024-12-02_10645 for the entire year of 2024, confirming the introduction of 28,000 MWh of electricity generated from wind sources into the grid.

We continue to enhance communication processes by implementing digital solutions where possible (e.g., introducing electronic handover protocols) and aligning with our strategic objectives. In 2024, we also replaced part of our fleet with low-emission (EURO 6) and hybrid vehicles and placed additional orders for delivery in 2025.

Given our role as a financial institution, the most significant contributions to sustainable development, particularly climate change mitigation and adaptation, involve allocating substantial financial resources to support Poland’s energy transition and adapting our product offering to evolving market demand. This includes financing investment goals and providing sustainability-linked financing. To this end, we are implementing tailored solutions for corporate, business, and retail customers. The initiatives reported as of the end of 2024 were defined before the European Sustainability Reporting Standards became mandatory and before the Bank calculated financed emissions under Scope 3, Category 15. As a result, we do not relate the amounts of financing granted to potential reductions in financed emissions. Despite the absence of quantified decarbonisation targets for the credit and investment portfolio, we see these actions as key drivers of credit and investment portfolio decarbonisation. Key information about the financial products and solutions offered is available to external stakeholders on the Bank’s website. Due to the lack of established decarbonisation targets, the Bank has not linked the impact of activities undertaken in 2024 to potential achieved emissions reductions in the financing portfolio.

In 2024, we continued to implement our strategic objectives. The most significant actions increasing the Bank’s involvement in sustainable development financing, including addressing material climate change mitigation and adaptation issues and responding to the evolving market, included:

• Green financing – approximately PLN 13.738 billion;
• New sustainable financing – PLN 12.697 billion;
• Customer bond issuance financing – PLN 20.92 billion;
• EU Taxonomy-aligned financing: gross carrying amount exposure aligned with the EU Taxonomy under CAPEX KPI (PLN 3.173 billion) and TURNOVER KPI (PLN 2.092 billion);
• Other initiatives:
  • introduction of a corporate banking customer carbon footprint calculator;
  • In the area of business loans, in 2024, guarantee limits from portfolio agreements with BGK in the amount of Biznesmax plus: working capital loans – limit: PLN 136,000,000 and investment loans – PLN 204,000,000; Ekomax – limit: PLN 250,000,000.

In November 2024, we prepared the first allocation report for funds raised through the 2023 issuance of EMTN bonds with a total nominal value of EUR 500 million, aligned with the Sustainable Finance Framework adopted in 2023. In November 2024, we prepared the first report on the allocation of funds raised under the EMTN bond series issued in 2023 for a total nominal amount of €500 million consistent with the 2023 Sustainable Finance Framework.  We also achieved the target set by the Sustainable Finance Framework – as of October 15, 2024, the total value of the Qualified Financing Portfolio included 33 projects for a total amount of EUR 526,837,201 under the green Eurobond issue. This value exceeded the issued amount (EUR 500 million), which means that the full allocation was realized within a year from the date of the green bond issue (XS2724428193).

In the retail customer segment, we are implementing the ESG Strategy by introducing products dedicated to environmental goals that meet the needs of the financing market for individuals. The Bank is maximizing its business opportunities in this area by continuing to offer:

• Express Loan for EKO purposes up to PLN 100,000 – a PLN 281 million[1] – cash loan with 0% commission and reduced margin/interest rate, when the customer allocates it for EKO purposes related to the purchase / installation of: among others. renewable energy sources: solar collectors, photovoltaic panels / cells including energy storage, central heating boilers (excluding coal and eco-pea boilers), heat pumps and with the use of geothermal heating, vehicles with electric or hybrid propulsion, domestic bio-purification plants, ventilation with heat recovery, domestic water treatment plants from own intakes or rainwater recovery system.
• EKODOM residential loan – PLN 204 million[2], a loan offer with a reduced margin if the customer invests in energy-saving installations such as solar panels, photovoltaic panels/fires, including energy storage, heat pumps or central heating boilers with geothermal heating as part of the property being financed.

As of November 1, 2024, we have implemented a new process that allows us to evaluate energy performance criteria as early as when a customer applies for a mortgage. If the EP indicator criteria required by the Bank are met, the customer also benefits from a lower margin. The Bank aggregates data on delivered Energy Performance Certificates for statistical purposes.

[1] Gross carrying amount of loans as of 31.12.2024

[2] Gross carrying amount of loans as of 31.12.2024