25. Investment securities available for sale

On 2 November 2015 PKO Bank Polski SA was notified about the contract of acquisition of shares of Visa Europe Limited by Visa Inc. (“Transaction”). The Bank as a member of Visa Europe Limited is among the beneficiaries of the Transaction. The Management Board of the PKO Bank Polski SA approved the conditions of the Bank’s participation in the transaction, according to which the total pre-estimated Bank's share in revenues (excluding the potential deferred payment of “earn-out”) is expected to amount EUR 88 875 thousand (which is equivalent to PLN 378 741 thousand (according to the NBP average exchange rate of 31 December 2015), including EUR 66 167 thousand that will be paid in cash and EUR 22 708 thousand with shares of Visa Inc. These amounts are not final and may change due to the complaint filed by the Bank subject to the proposed method of determining the Bank's participation in the settlement of the Transaction and possible objections of the remaining members of Visa Europe Limited, costs of the Transaction, as well as in the cases indicated in the documentation relating to the Transaction (the so-called “leakage”). The amounts due to the Bank should be settled by 30 June 2016. In accordance with the Transaction’s framework, additional deferred payment of "earn-out" is possible. It would be paid in cash after sixteen quarters from the date of transaction settlement, but its real value is currently not possible to determine. The transaction is subject to receipt of applicable regulatory approvals.

As at 31 December 2015, a portion of the anticipated as described above, remuneration in the amount of EUR 76 840 (i.e PLN 327 453 thousand) has been included in the valuation of shares in Visa Europe Limited (in other comprehensive income – in position of the revaluation of financial assets available for gross sales). So far Visa Europe Limited shares were valued at cost amounting to PLN 42.62 due to the inability to fair value measurement.

As at 31 December 2015 and as at 31 December 2014 the Bank did not have transferred financial assets, which are derecognised from the financial statements in their entirety for which the Bank would continue involvement in those assets.

Bank Deposit Guarantee Fund

In accordance with Article 25 of the Act on the Bank Guarantee Fund dated 14 December 1994 (uniform text Journal of Laws of 2014, item 1866 with subsequent amendments) the following assets are pledged as collateral for liabilities of the Bank Guarantee Fund:

Assets represent Treasury bonds with maturities sufficient to secure their carrying amount over the period defined by the Act. The Fund is increased or decreased on 1 July of each year, in proportion to the amount providing the basis for calculation of mandatory reserve deposits. Those funds are treated as assets held as collateral for own liabilities.

In connection with suspension of activities and filled bankruptcy motion by Polish Financial Supervision Authority (PFSA) on 21 November 2015 of the Spółdzielczy Bank Rzemiosła i Rolnictwa in Wołomin (the Co-operative Crafts and Agriculture Bank in Wołomin), the Bank Guarantee Fund obliged the parent company of the Group to make payment in amount of PLN 337 932 thousand, intended for the payment of the guaranteed deposits held by the depositors of this Bank.

The parent company of the Group made the abovementioned payment on 30 November 2015 and then decreased the value of deposit guarantee fund by the value of transferred assets:

• value of the deposit guarantee fund as at the II half year 2015PLN 946 431 thousand
• assets transferred to the Bank Guarantee FundPLN 337 932 thousand
• value of the deposit guarantee fund at 31.12.2015:PLN 608 499 thousand