Principles of remuneration of the Bank’s Management Board members
According to principles of remuneration of the Bank’s Management Board members drew by the Supervisory Board, members of the Bank’s Management Board are entitled to:
- monthly remuneration at an amount determined by the Bank’s Supervisory Board for each member of the Bank’s Management Board,
- benefits payable to employees of the Bank (excluding benefits payable to employees under Works Collective Agreements – Zakładowe Układy Zbiorowe Pracy - ZUZP):
- under the common binding laws,
- under the Bank’s internal regulations, with standardized or exceptional character, for which the grant basis is not an evaluation of the Member of the Bank’s Management Board work effects or the result of the area supervised by him.
- variable remuneration components for the results of work, in particular bonuses, awards for outstanding achievements, severance related to the termination of the employment not higher than 3 times the basic salary, which detailed rules of granting and withdrawal determines the "Regulations of the variable components of remuneration for the members of the Board" adopted by the resolution of the Supervisory Board - taking into account the requirements of relevant legislation on the variable components of the remuneration of employees in banking institutions in positions that have a significant impact on the risk profile,
- Bank-financed insurance, in particular in respect of death and serious illness, permanent disability, permanent or long-term damage to health, incapacity for work (detailed scope of insurance will result from the insurer's offer and conditions negotiated by the Bank).
Remuneration for the Management Board Members paid out in 2015 (in PLN thousand)
|No.||Position||Remuneration||Variable salary components||Total|
|Fixed||Variable||additional insurance||staff pension scheme||health care and social fund|
|1.||President of the Management Board||1 892||1 824||875||751||40||29||84||78||1||1||2 892||2 683|
|2.||Vice-President of the Bank's Management Board in charge of IT and Services||1 419||1 368||651||558||40||26||63||59||1||1||2 175||2 012|
|3.||Vice-President of the Bank's Management Board in charge of Finance and Accounting||1 577||1 520||742||655||39||24||71||66||1||1||2 429||2 266|
|4.||Vice-President of the Bank's Management Board in charge of Risk Management||1 419||1 368||532||267||40||28||60||50||1||1||2 051||1 714|
|5.||Vice-President of the Bank's Management Board in charge of Insurance Banking||1 400||1 366||595||521||46||29||57||33||1||1||2 099||1 950|
|6.||Vice-President of the Bank's Management Board in charge of Retail Market||1 419||1 368||648||536||46||26||63||58||2||1||2 179||1 989|
|7.||Vice-President of the Bank's Management Board in charge of Corporate and Investment Banking||1 419||1 368||696||586||43||17||65||59||1||1||2 223||2 031|
Variable components of remuneration of board members and key managers with a high impact on the bank's risk profile (Material Risk Takers - MRT)
In accordance with the requirements of the CRD IV and the Decree No. 604/2014 supplementary to the directive of the European Parliament and the Council 2013/36/EU with regard to regulatory technical standards with regard to quality criteria and appropriate quantitative criteria for determining categories of staff whose professional activities have a material impact on the risk profile of the institution dated March 4, 2014, Bank updated rules, previously implemented in 2012 for determining the variable remuneration components of MRT - through resolutions:
- Supervisory Board - variable components of remuneration policy under the name of "Rules of the variable components of the remuneration of persons holding managerial positions at the Bank" (which are the basis of further regulation) and "Rules of the variable components of the remuneration for the members of the Board"
- Board of Managers – "Rules of the variable components of the remuneration for persons holding managerial positions."
The rules and derived regulations of remuneration describe the procedure of granting MRT variable components of remuneration related to the results and effect of their work - awards for special achievements in work and bonuses.
The basis for awarding variable remuneration components are primarily premium targets assigned by the Management by Objectives (MbO).
Variable components of remuneration for the evaluation period (calendar year) are awarded after the settlement of bonus purposes in the form of:
- Non deferred – in the amount of 60% of the variable remuneration (in the first year after a period of assessment)
- deferred – 40% of the variable remuneration (in equal instalments over the next three years after the first year after a period of assessment)
wherein both the non-deferred and deferred salary is awarded in equal parts in cash and in the form of a financial instrument, i.e. the phantom shares (whose conversion into cash according to the updated of the prices of shares of the Bank is carried out after a period of retention and in the case of deferred compensation - after a period of deferral).
In case the amount of variable remuneration for the year exceeded PLN 1 million, PLN 400 thousand plus 60% of the excess over the amount of PLN 1 million is subject to deferral.
Variable remuneration may not exceed 100% of the annual fixed salary for managerial positions and 70% for members of the Management Board. At the request of the Supervisory Board the limit of variable remuneration for employees who are not members of the Board can be raised up to 200% of fixed remuneration for investment banking jobs - subject to approval by the General Meeting of Shareholders.
Each of the components of accrued variable compensation may be reduced as a result of the following:
- failure to observe the law or standards of customer service,
- improper perform their professional duties,
- behaviour in relation to other employees violating the rules of social coexistence.
The bonus amount:
- for member of the Board may be adjusted in minus or in plus by the certain rate - depending on the achieved results of the Bank specified in the Bank’s Annual Note (a set of key indicators of management specified for a given calendar year)
- for MRT who is not a member of the Board it may be adjusted in plus by certain rate depending on the results of the Bank specified in the Bank’s Annual Note.
In the case of members of the Board granting and payment of variable remuneration is conditional to approval of the financial statements for the period of evaluation by the General Meeting of Shareholders.
In case of:
- significant deterioration in the Bank's results,
- assessment of a significant negative change in equity,
- violation of law or commitment of significant errors by MRT,
- adjustment of implementation and completion degree of results or objectives of MRT,
- performance deterioration of supervised or managed structures,
- granting of variable remuneration on the basis of incorrect, misleading information or MRT fraud it is possible to use - respectively by the Supervisory Board or Board of Directors – malus-type solution reducing the size of the due variable compensation deferred in subsequent accounting periods.
In case of granting the MRT severance related to the withdrawal from the function associated with the termination of employment (other than resulting from generally applicable laws) its sum reflects the assessment of the work in the last three years of employment. The Bank's regulations stipulate the maximum amount of severance pay.
Members of the Board and selected MRT are additionally covered by non-competition agreements. The agreements provide payment of the required labour law damages for refraining from hiring at competition after the termination of employment at the Bank.
Information on availability of non-monetary remuneration components to individual members of the Board of Directors and key managers
Members of the Board and key managers of the Bank are entitled to the non-financial benefits that are available to all employees, ie.: medical care, PPE, group insurance and cafeteria system - MyBenefit and other benefits from the Company's Social Benefits Fund.
Medical care is available to board members and key managers within the highest Bank's benefits package "VIP".
Insurance conditions - Members of the Management Board are entitled to Bank-financed insurance, in particular for the death of serious illness, permanent disability, permanent or long-term damage to health and inability to work.
Members of the management board may also join cost-effective group insurance offered to employees, for a fee paid by employees through the Bank.
Principles of the remuneration of Supervisory Board members
Ordinary General Shareholders’ Meeting of PKO Bank Polski SA by the Resolution No. 36/2010 of 25 June 2010 established the monthly salary for members of the Supervisory Board of:
- Chairman of the Supervisory Board – PLN 16 thousand,
- Deputy-Chairman of the Supervisory Board – PLN 14 thousand,
- Secretary of the Supervisory Board – PLN 12 thousand,
- Member of the Supervisory Board – PLN 10 thousand.
Supervisory Board members are entitled to remuneration regardless of the frequency of meetings convened.
Regardless of the remuneration, the Members of the Supervisory Board are entitled to reimbursement of the costs incurred in connection with performing the function, and in particular travel costs from the place of residence to the location of the Supervisory Board's meeting and back, costs of accommodation and board.
Supervisory Board members remuneration (PLN thousand)
|Board of Directors|
|Remuneration received, due or potentially due from PKO Bank Polski SA||1 197||1 157|
|Remuneration received, due or potentially due from subsidiaries*||-||-|
|Total remuneration received, due or potentially due from||1 197||1 157|
* Other than Treasury of State and its subsidiaries
Short-term benefits include employee benefits, which are fully settled before the elapse of 12 months from the end of the annual reporting period in which the employees performed the work related to them.
Full information regarding the remuneration components and other benefits on behalf of the members of the Management Board of PKO Bank Polski SA and the Supervisory Board in the reporting period has been presented in the Financial Statements of PKO Bank Polski SA for the year ended 31 December 2015 (notes 46 and 47).