Powszechny Zaklad Ubezpieczen Aktie

Good morning, ladies and gentlemen. Welcome to this conference where we will discuss the results of PZU Group of the second quarter 2026 in the first half of 2026. The presentation will be delivered by Mr. Benczak as well as Maciej Fedyna, who's responsible for risk and finance area. CEO, Mr. Benczak, without further ado, I pass the floor to you.

Welcome to this press conference after the first 6 months of 2026. Ladies and gentlemen, we have looked into the results of the PZU Group following the first 6 months of our operations this year. And I must tell we have been proud of them. in race. And I had 6 months have proven the really demanding and this demanding character was very much due to geopolitical environment. which had a lot to say as regards under situation on the financial markets, but also it was due to what happened in the Polish market. We had new tax regulations. We had new regulations of ECG and regulations concerning the tax rate, plus and the very character of the transportation system settlement in payment. This notwithstanding, we have proven, we are really resilient. Our ecosystem at PZU Group has been resilient. And thanks to that, we have been able to manage and to have sales secured at PLN 15.7 billion, PLN 0.5 billion, almost more year-on-year. We obtained PLN 3 billion net. ROE exceeding the level of 17%. In parallel to date secured a very sound financial standing of PZU. That is our capital position was entered 230%, PZU at 233%.

Moreover, we took a decision to pay off the dividend equivalent to PLN 4.8. Historically speaking, this has been one of the highest dividend levels ever at PZU Group. This means we catered to the commitments we had once presented before our shareholders and all stakeholders. In May this year, S&P has made our credit rating stable at A minus with a positive outlook. Importantly, SAP has highlighted as a group, we remain stable capital wise, and we are very flexible in terms of the growing capital requirements, which are linked to the changing solvency II entering force as of January 2027. Our Solvency II is at 230%. It is a bit conservative, but at the same time, it's to be considered a very effective investment portfolio. This is another factor. And yet, the factor is our reinsurance program. What are the sources of the growth in question and the results we obtained in the first 6 months of 2026. Well, for the details, we will hear from Maciej Fedyna. We will go through each and every segment of our operations. Now we'd like to stress our major growth pillars have been group insurance revenue as well as individual continued insurance revenue. There is one factor that I particularly enjoy that is we have been following up on the growth in our individually protected insurance revenue.

Furthermore, we have secured a 30% growth for the last 6 months in assets of external clients. It is a very positive information because in all these factors, we have undertaken a very effective actions. And they have brought about some tangible results. And let me now refer to some of your comments. We have prepared some bit of information on the PZU [indiscernible] where we have grown at 2-digit speed. Well, you may recall when I joined the Board, I kept stressing investments should remain central for our operations at the PZU Group. So let me draw your attention to that. And heavily after 6 months, we have secured an almost 40% growth in the assets of external clients which are managed by PZU Group TFI, that is CFIPZU,PKOTFI and Alior TFI, respectively. Now moving on to PZU Zdrowie. Have a look. We have managed a revenue growth here. At the same time, we have concentrated on making our own as comprehensive as possible and linked to our life insurance scheme. Parallel to that, we have developed our offer in terms of Zdrowie services pillar. And here, we focus on 2 elements. Number one, expansion of our own medical facilities in a number of 13 medical facilities. Yesterday, we had a new entry of a 134th facility, the key this time in bids. And then on, we have followed up on our acquisitions in Poland.

And adding to that, we are minded to expand our offer both at PZU Group and at our Capital Group. One example being the acquisition of Babka Medica plus Boramed, another company. And we really want to make the best of the potential. Those 2 companies present the especially good and women's health care. As regards CM game here, we are happy. We have obtained some Polish experts orthopedics. Thanks to that, we can guarantee to our customers some most sophisticated treatment options in the area of automatics. Our network is well developed. But if there are any wine spots, we intensely set 4 facilities that we could possibly acquire. One example being CM Osteodex. This particular facility caves one particular white spot that we in the past. And that's precisely the mine, we are minded to pursue in the future as well with the overarching goal is to make the access to leading specialists easier and the thing holds true for making access to some advanced treatment options. We want the offer for our customers to be as comprehensive as holistic as possible. The first 6 months of 2026 have been marked by the constant expansion of our product offer. Examples PZU Orthoplan, in addition to group life insurance programs. makes possible to cover the costs of planned orthopedic surgeries connected to the ramifications of accidents. And this is how we want to make our offer more and more comprehensive.

Now non-life insurance segment. We have supplemented our offer directed as East expert network for the for our insurances, personal accident and business interruption BI insurance. This is a segment that has started to play an even more prominent role in our economy, and that's why we want our customers to have access to modern solutions provided by the PZU Rod. We coordinate and also the insurance scheme, which is addressed at the nuclear sector and my colleagues that are active in this domain, preparing the offer for our partners. Let me get back briefly to the investment pillar. Now we managed as many as 139 million assets at ETF PZU. And let me tell you this. We are especially proud of the fact is about almost PLN 60 million of these assets are connected to long-term saving schemes. They are both pension products as well as PPK scheme. The reset a number success we are mentioning. -- at TFI PZU, they have received the level of more than PLN 130 million and that's the fact that makes us all very happy. And I trust, it marks a new beginning on the path that we want to pursue. There are some new listings of other assets. And let me take this opportunity to tell you that. We are all sellers at PZU, salespeople, and that's why that's been carried you to take advantage of one particular discount at our TTF purchased them at very favorable conditions, and the discount will last by the end of the year.

So we have discussed pure business. But there is also a whole range of other strategic projects that we have pursued and they are to boost our effectiveness. And especially, we concentrate on boosting our effectiveness in terms of technological debt that we incurred in the past. We are very much minded towards an AI strategy. And these steps are intended to make us AI ready. The last conference was about our technological platform. Now we speak of forthcoming projects or platforms that will be attached to very particular segments of our operations. The goal being boosting quality as well as effectiveness in terms of process management. We want our employees to be able to focus solely on customer experience and making our products and services as good as possible.So how do we scale up AI at PZU? We have already implemented over 30 AI-enabled solutions implemented and over 30 new initiatives under development. The focus on those domains on the following domains: Underwriting and products in the business section.

We are about to open a project that will implement a new operating model for business sales. And in that model, we want to use AI-enabled solutions in sales and marketing, we intend to use various AI-based components that would increase the quality and efficiency of customer service. In terms of claims handling we will soon announce the implementation phase of the new system for claims handling, this system will be AI ready. Please note that in claims handling, the Best group handles about 10,500 claims, and we are paying out about PLN 35 million daily Therefore, in this specific area, we see a great potential for improvement for improvement of our efficiency. Lastly, customer service and organizational support. This is another domain in which we wanted to introduce AI-enabled solutions. The plan is to, of course, implement new solutions, but I can already share with you some examples of what we have managed to achieve thus far. Last year at Pasati Group, the number of codes generated using artificial intelligence was at 0.

Today, the number of code that is generated using AI tools amounts to 30% of all code written in our company. So we have made a large step forward, but we're very well aware that there is a long way to go. We have been consistently implementing our strategy to become a regional insurance leader. We are finalizing the acquisition of MetLife, Ukraine. Currently, we are in the process of obtaining the approval of antitrust authority and we hope to close this deal at the beginning of next year. We also want to simplify the PZU structure in Poland. As a part of that, we are moving on with implementing the merger plan with Link 4. We hope that the merger will take place in January. And we hope that we will be able to effectively put to use the multi-brand strategy following the merger. Also in the first half of this year, together with KUKE, we have launched a new product and this product offers insurance coverage for extraordinary risks related to military activity in Ukraine.

So now I'll just give you a brief reminder of our position in Poland and abroad. We are the leader of the Polish market. In Lithuania, we're #1 as far as non-life insurance goes and we rank 6 in terms of life insurance. In Latvia, we are #1 in nonlife insurance. In Estonia, we rank 4 for non-life insurance in Ukraine, we rank 9 for nonlife insurance, and we rank 4 for life insurance. And as I've said before the closure of MetLife merger is in the pipeline. Once it's finalized, we will become a leader on the Ukrainian market. After Q1 2026, our market shares are as following: 28.5% in non-life insurance and in life insurance. And in life insurance, we had over 40% as far as regular premiums go. My colleague will is about to give you some more detailed numbers. But before I give him the floor, I would like to highlight our corporate social responsibility initiatives. You can scan the QR code to access the website where you can find more information about PZU's social engagement over the last few decades. And now I just wanted to highlight a few initiatives that we implemented in the last 6 months. 7,000 children were trained with our support on how to stay safe when close to water. We have trained 1,800 people in life-saving skills. We have provided 4,000 safety helmets for cyclists. Also in cooperation with voluntary fire fighters, we sponsored over 3,000 smoke detectors in 2026. We also support voluntarily mounting near rescuers. We also support voluntary firefighters and voluntary life guards in Poland. We also support police and other uniform services in our country. So corporate social responsibility is something that has been present in our group's DNA.

I also believe that this is something that makes us stand out against the competition who also can create similar initiatives and open funds that would be dedicated for corporate and social responsibility. So that's all for me. Now I'll give the floor to Maciej, who will give you some hard financial data. Thank you for your attention.

Ladies and gentlemen, it's a great pleasure for me to present such outstanding results yet again. The CEO has already said that the total net profit in the first half of this year was slightly above PLN 3 billion. This is a very good result. We are pleased with it. And we like to break down our results into individual quarters. Although I must admit that it's not always a good idea to compare quarters one-to-one because there are certain weather events or other events that generate variability and the differences among individual quarters. However, one thing is clear from this data. The PZU Group, thanks to diversification and having a very broad offer for the customers and selling products across many channels is very resilient and is able to generate very satisfying results.

In the first half of 2026, Insurance Service result is the strongest component in our results, it amounted to nearly [ PLN 2.3 billion. ] Our operating margin in life insurance, which is the key business indicator for us amounted to PLN 27.2 million and in second quarter, actually, it was 29.1%. So it was even higher. We have managed to achieve such good results for the first half of this year despite minor headwinds and slightly worse result on life insurance than in the previous year. In non-life insurance, the combined ratio is at 87.9%. So it's the same as last year. And in the second quarter, actually, we managed to achieve a combined ratio at 89%. This is a very good result, especially taking into account that it's the fourth consecutive quarter when the combined ratio is below 90%. Again, the last quarters and the last year was not easy. There were numerous challenges. So this only demonstrates that our company, thanks to a diversified portfolio and the multichannel sales stays very resilient. And we can compensate losses in one part of our activity or potential losses with good results in another sector of our activity.

Also, the results that I'm presenting now show that actually, we are quite reliable and our results are predictable. Now the main portfolio. The results and investment portfolio was at PLN 1.404 million. So it's very similar to the result that we published last year. And again, given the general volatility of the markets in 2020, so this is as a very good result. Interest rates are lower this year than last year. Therefore, the result of our investment portfolio is very good, given that piece of information. And there are differences between -- among individual quarters, but that's attributable to those trends and the one-off events that I mentioned. For instance, last time, we did mention the impact of currency exchange rates on our portfolios. Well, I have prepared a separate slide dedicated to that. So I will discuss it in a moment. But let us now focus on our core activity. I always say that CFOs are very happy when revenue grows faster than costs. And that's the case and I always say that the CEO is also happy when this happens. So we have had a stable growth quarter-on-quarter and year-on-year.

How did we achieve this? Well, we had very good rentability profitability. And then Bogdan also mentioned the our business strategy. We keep adjusting our offer to the needs of our customers in both group and individual insurance. We managed to keep the margin above 25%. It's been the case for some time already, and this is good news. On top of that, we have been developing individual protection insurance, and that's quite important. The growth dynamic there is at 26%, 27%. So the importance of this offer has been growing in our portfolio in particular, given the fact that the margins on those -- on this type of insurance is higher than in group insurance. So the structure of our portfolio is conducive to growth and growing margin. And often, during meeting with investors, we explained why do we have the growth in individual protection insurance. And during those meetings, we always stress the fact that the product and the offer is being constantly developed and adapted to the needs of our individual customers. That's one thing. And the second important aspect of it is making the best use of the skills of our sales force.

As a result, they are able to target the right customers. So basically, our sales force has a great potential, and we are making effective use of it. And this is already, I believe, a long-term trend that we can boast. And this makes up the complex marketing and 29.2%. Let me now jump on to [indiscernible] non-life insurance and the life insurance and afterwards, will discuss the written premium, which is slightly different to the revenue stream from noninsurance. This is what Merit 1 commentary after the first quarter we said that the motor insurance environment has been demanding, especially when it comes to MOD insurance. It is visible in our results per quarter 2, especially when it comes to CO are in motor insurance. And we are trying our utmost to change it because we had the negative result for 1 quarter. But as we go and read the figures, let me draw your attention to how high the revenue is of insurance because this might be slightly misleading. You may recall, last year, we to a decision on shifting some of the products of some segments of our clients from the mass category towards a more individualized customized underwriting process and corporate field. And that is why we have a switch of written premium in between the segments. Therefore, the revenue dynamic in the mass segment might look worse. Have we not taken that decision, yet the decision in question was more than sound from the characteristics of the business process.

And the same helps true for the pace of development in corporate insurance. It would have been slower, had it been not for the decision that we took. So this effect is to be blamed for the negative results, we obtained in the motor segment. It would have stayed negative Still, it would have been significantly better than the result than we see now. And there is one more comment I wanted to spare and this is something that we already send on the occasion of discussing our first quarter profitability in motor insurance is a very satisfactory level. And this is mainly owing to case handling staff case handling process, where we capped improving a lot, especially when it comes to the expected value and the expenses overall in the area of case handling. We're concentrated on the scale of improvement and streamlining, which is especially seen in motor COR stays at 95%. Why is it so high? And it is in the corporate area below 90%. It was not to be seen in MOD, and that's why there was no compensating effect for the very consequences of the price pressure on that market. Well, that's one side of the coin. The flip side of the coin is some other positives that we have spotted already. Well, the [indiscernible] is on the market saying that there is a dichotomy between the medium claim and medium premium is not something good for metal players. And we have been on top of all these things, and we hope for the trend drivers in the coming months.

Now not insurance. As said, we reduced a lot the funded the margin in the subsequent segments is very good. At the same token, we have been very happy about the dynamics in this segment, which had historically not been as robust in our portfolio. So the margin is better and the pace of development is better. 5.2% of the premium dynamic in group as well as we did continue insurance is something that we need to pay our attention to look at the demographic trends. There are less and less people in Poland. That's something that's set to stay and will, for sure, produce its ramifications also on our portfolio. And well, this notwithstanding, we have managed to grow and a base of more than 5%. Now let us jump on to Slide #29, I'm sorry. So far, we've been talking about some metrics and values in line with ISSF insurance revenue is not something to be equivalent to the written gross premium in -- on the domestic market. And let me now focus on the non-life insurance part. Quarter 2, the pace of our growth has improved significantly, 6% -- 26% second quarter 2026 when compared to the second quarter of 2025, we have grown significantly in all the segments in question. So there is a rebound after in the previous quarter, where we were circulating around 0 now. And the result with this causes a habit of what is to expect of insurance revenue in the future.

And now let us get back to the investment result. Q2 saw a very nice profitability in that portfolio equivalent to 5.3%. Some part of it is due to the changing nature of the financial markets. And another part of it is due to the facts, not only effect that we see quarter-to-quarter. One fact being the way you price the properties you've got maybe either below or above the 0 level. And this time, it was in green. So we are happy about that. But look at the profitability of our main portfolio. Our result was PLN 700 million. And that's the major contribution to our overall profitability. Our interest rate revenues have been very stable. That's the effect of stability. Our investment strategy, which sees or has seen no revolutions whatsoever. The financial markets remain volatile. And in that environment, we try to [indiscernible] to secure our profitability, not only in the short term, but also in a longer time horizon. And that's something that is well, also due to the fact that the markets remain as set volatile. And I ask us a question. We've got such a nature of revenues or maybe there is some gap to the fair value. Well, everything needs to be seen in the valuation of payouts, and you will have a chance to look at that on the forthcoming slides.

Treasury debt, 70% debt instruments of first quarter, we registered the valuations and the devaluations with a drop, and it correlated with the uncertainty is a knock on in fact the person Gulf crisis. The second quarter was way more satisfactory here because the interest rates were lower. For the capital instruments, here, we gained as well on our investment equity funds. There is an important component, which is related to both cybersecurity and artificial intelligence. These are 2 domains that produced a lot of money in quarter 2. On average -- on average, the return on our main portfolio exceeds or has exceeded 5%. That's something that we can be very happy about. Anyway, there is no guarantee will stay the same still. This is an important benchmark may present a very none contribution in this segment of our operations. Now let me jump to this slide on solvency. From now on, well, outline both the official solvency results in accordance with the current regulations. Plus, we will provide you additionally with a simplified calculation such that will show you how our daily solvency would look had we taken advantage of the changed Solvency II rules and the requirements of the end banking sector.

So the official solvency towards the end of March was at 230%. So an overly very satisfactory result. -- countered a fact that [indiscernible] presented a very substantial uncertainty on financial markets and debt instruments balloon, it had its impact on the valuation of our portfolio. So it's been taken account of and so still did not make our results worse. They could have been even better if it hadn't been for making to solvency calculations merger. Let me comment on that. We've got our assets in the insurance world. In the case down, we expect these assets will be distributed to our shareholders, then we will need to make these assets smaller. And here, we come at our own funds. The situation is slightly different in the banking sector. This is more an accounting metric, and that's why own funds are fed not by own result, but with some delay after some decisions have already been taken once the profits eventually stay within the bank. If we consolidate the assets and bear in mind, we are an important shareholder in 2 banks. There is a condition of 2 worlds. On the one hand, for the time being, we have not seen the emergence of the funds from the bonds that will get to us after the dividend is paid off.

And on the other hand, we have taken into consideration on the whole group's results and some funds, which are attributable. The result made by the box. It's something very painful in the first quarter every year because for [indiscernible] a period of 5 quarters banks are not taken into consideration at that calculation. Later on, the situation is different because the decisions in question have been made at the general assembly -- fare. So we missed just the current year data. So there are no negative impacts on the banks on the insurance firm. And -- but when we're trying to make those 2 parts merge, some negative consequences might be felt -- this notwithstanding come results are really good. So let us now look at how solvency to regulations changes, what kind of ramifications it will produce. If we applied Solvency directive at the end of 2025, our solvency instead of 39% would amount to 206%. We are not making any predictions regarding our solvency in 2027 because this depends on our balance sheet and also on the regulations that are in force on that date.

For instance, in September this year, the bank buffer will go up 0.1%. We also have our subordinated debt that matures in the second half of 2027. This will all have impact on our situation, dividends included. So all these factors will affect our final solvency. On this slide, we present numbers that we would be reporting had we adopted the new regulations already today. My conclusion from these figures is as follows. Regardless of the scenario that we used to analyze the situation of PZUi Group in the next year, it is clear that our potential to keep our dividend policy unchanged, is very high. It's very likely because the group solvency will stay over 200% after the new regulations come into force and in a volatile environment. And we have already reported that our benchmarks are 190% until Solvency II enters into forest and 182% after Solvency II enters into force. And we managed to achieve it. Moreover, these benchmarks are much higher than recommended by the financial authority. So these figures show that we are on the right track and that our business operations and dividends are safe.

In the previous meeting, we have already signaled that we have a few measures that we can take if we need -- if the situation worsens. And what we can do is we can change the risk level in our investment portfolio. We can modify our reinsurance policy. And as I've said, we are having an ongoing conversation with the financial authority regarding the actuarial risk of our insurance products. And these are all 3 independent areas of our involvement and in all boils to one important piece of information. Our dividend policy will stay as it is. It's not threatened in any way. Also, the PZU Board has some instruments and measures it can take like reorganizing the group, but for now, there is no need to do it in sight. That's all from us, and we're open to taking questions.

Are there any questions in the room?

Good afternoon. I represent City [indiscernible] of a bank, and I have 2 questions regarding your presentation. The first question is on the non-life insurance and Casco motor insurance. In particular, the data regarding written premium show that -- you -- there are some payment issues in the Casco sector? And how do you explain this?

Well, first of all, we have a very good penetration -- market penetration rate. In our case, that ratio is very high, definitely above average, especially compared to TPL. The price effect in motor own damage has its explanation and cars are becoming less expensive. So this translates into [indiscernible] sum insured. So the premium might actually go down because of the lower value of vehicles. So that's one part of the explanation. Another part of the explanation is that our market share in the CASCO segment is much higher than in TPL.

Therefore, our sensitivity regarding market phenomena is different in the Casco segment than it is in third-party liability insurance. For this reason, the price pressure in the Casco segment affects the gross written premium, while in TPL, the price sensitivity is less pronounced in our portfolio is growing faster. I'd like to underline that in both TPL and the MOD, we report a growth in the number of customers and the growth in the premium rate. We are trying to optimize the selection of customer groups in both segments. We're also trying to find the possibility for increasing the premium or wherever it's possible. Recently we have heard some positive news from the market. But there are also new competitors entering the Polish market, which means that we will have to create our policy having the competition in mind.

And we'll continue to do so because this is a foundation of our group's activity. We offer a broad range of products for a broad range of customer groups. We sell them across many channels. So we are not aiming at increasing our market share attaining cost. Our aim is to cater to the needs of Polish citizens and offer quality products.

My second question regards life insurance. Congratulations on the growth of the gross written premium, especially in individual insurance. Can you give me more information regarding the structure of the premium. How does it break down into protection and investment? [indiscernible] I remember that in previous presentations, you were giving us more details.

Let me answer this way. We are very proud of our growth and this growth concerns mainly individual protection insurance. So the growth does not originate from selling investment products or products that are qualified under the Polish regulations as one of written premium. The numbers that we give are based on IFRS 17 applied to individual protection Life Insurance products always include some investment component, but it does not affect the growth of the premium that we present. So what we boast is the growth of individual protection coverage offers to individual customers. And the result does not stem from one-off improvement to the product, but from a stable growth and adapting our offer so that it responds best to our customers' needs. This was not something that was our area of specialty, but this has changed. And we are growing intensely.

If there are no more questions in the room, I will read out the questions that we received online. So Trigen, brokering house Martin Marcinowski, can you give us a brief comment regarding the competition? You said that PZU has been growing in certain segments, unfortunately. The interpreters did not receive that question and it was read out very quickly.

So Maciej has given you the answer regarding the motor sector. And the changes in the motor sector are caused by reclassification of the products that we carried out within PZU. But you need to pay special attention to the type of contracts that we have with corporate clients in motor insurance. So usually, those contracts are entered into for a period of 1 year, and the price is fixed for 1 year. Now regarding nonmotor insurance I will reiterate what Maciej said, namely to give you the sources of our group's resilience. We offer as much as Maciej said many products, and we take advantage of it.

So we are successfully selling insurance, nonmodern insurance to mass customers, nonlife insurance that is. And in the corporate segment and non-life insurance, well, what happened there was that the market cycle has changed. So the prices in non-life insurance in the corporate segment have been falling sorry, non motor. The speaker corrects himself. Maciej, do you have anything to add?

Well, not all product lines are growing at the same pace in some segments. We reported double-digit growth in SMEs, the growth is, well, not in double digits. But we're growing at a pace closer to 10% than 5%. And crop protection in that segment, actually, we're not growing, and that segment has negatively affected our sales dynamics. We are reporting growth in tourism travel in travel insurance, and we want to grow more. And we have an amazing growth in additional motor insurance. So that was in mass insurance segment.

And now in the corporate insurance. If we examine the dynamics of the entire portfolio, we'll notice that the major role is played by large investments that translate into premium gross written premium. And we're overall generally optimistic about the growth that we may expect this year and in the following years. It seems that the -- there is a good mood among investors. In Poland, here, therefore we need to examine the growth in the corporate sector over a larger time frame than individual quarters -- and with large contracts, we observed an important role that is played by the global reinsurance market. So if the markets are more risk ready and they value risk they may estimate the risk value at a lower rate, then it affects the gross written premium. Also, we must remember that the market share is not our main goal, which is treated as an indicator of our position. So we have a healthy attitude towards that we focus on our product groups on the margin. This is our main area of focus.

Let me pick up on that. Let me pick up on the solvency question, just to disburse any potential doubt. We haven't mentioned next year, we'll the due date of our subordinated debt. And in this context, we have already started working out various scenarios to be able to answer the question, do we really need refinancing? And if we do, [indiscernible] need refinancing, then what under terms for that in what currency? Should it be a single event or a more comprehensive program? That's something that we have already started working on. That's in the pipeline. Looking at the market trends, the environment and at a very good place for whether or not we can obtain financing. Should there be any news in [indiscernible] regard, we'll share it. In a way, we wanted to point out we are working on that. We are following up -- and should there be any opportunity for us to take advantage.

We will -- to other outstanding questions regarding solvency and the dividend. Martin Martino's question. What will be the positive effect of Solvency II after the internal models have been implemented?

Ladies and gentlemen, this is a bit of news. We mustn't share not because we don't want to boast about that. And then there is a dialogue in ongoing between ourselves and the regulator, but it hasn't been brought to fruition yet. And it would be higher than appropriate? Should we share this kind of information without prior confirmation of whether the figures are sound, checked and whether we may already treat it as something already granted. So when we can, we will get back to you with a relevant information. The effective question is substantial. This is something that we can confirm now, but we musn't give you any figure details.

Another question also correlated to the brokerage of this last year, we had growth in single result [indiscernible] can also grow year-on-year. Our CEO, can I have a say in that?

This year, we have -- or we will pay a very high dividend. We've had a track record about the dividend and its annual growth. We've had very positive 6 months of 2026 already but, as Maciej said, we magnet compared quarter-on-quarter. Anyway, the intent of the entire Board is this. The dividend should be paid every single year in a way to make our shareholders happy. That's the stance of the company. We are mindful of the expectations of our shareholders. And this is our intent to say to pay of the dividend to our shareholders should the conditions be favorable every year.

There is one more understanding question. It brewed one about the market. What is your outlook of the sector in the longer horizon? Do you see more consolidation coming or maybe new players coming to the field?

Recently, we've had 2 scenarios played out on the market. There have been some consolidations on the market as well. However, recently, we have seen many new players emerge. Also in line of the MGA model that is the one that will also make its prominence on the domestic market.

Let me just pick up on that and say -- for the -- for the market consolidation and in insurance, well, many events have already happened. Slide 13 will tell you the story in that non-life insurance sees 75% of the market in the hands of 4 groups. These are not companies because one group may see or may accommodate more than one company. Well, my takeaway is, as far as the consolidation level goes, there is not much room left as the market itself is very concentrated. On the life insurance side, the image will present itself in different terms.

On the life insurance part, we would like to have more consolidation coming because the measures are the low our market and the market itself does not grow at the pace we would wish to see. And in Poland, this segment has not been an important part of savings portfolio. Should there be any important events coming, we will definitely communicate them. Anyway, there are some major global players opening up their activities here. Also in the spirit of MGA. So we are more than mindful of the trends we are talking about.

[indiscernible] are you in a position to quantify target savings that may be there, thanks to the AI implementation?

Well, we look at it in well, this a process that we pursue to fold. Number one, and there is this technological part, but also we would like to expand on our activities based on modern solutions. Also, we'll look at demography site, namely thanks to automation we can so to say, respond to certain forecast challenges to come. We must be ready. We must be ready in terms of our operations to be able to provide as good as possible service and as efficient as possible service our customers.

Are there any other remaining questions in the room? Yes, there is one.

Let me ask you another question on some strategic outlook. Are you planning on to review or update the strategy, especially with regard to the revenue stream that may be evolving somewhat different to what you had expected?

Well, we keep focusing on the accomplishment of strategic targets. Indeed, we have revenues in Czech we are perfectly mindful what the assumptions have been as we were working on this strategy a few years back. Anyway, now we work towards the initiatives which are now in the pipeline, which are to pave the way for another strategy emerging for the years, post 2027. We foreground the strategy components such that revenue streams. However, vis-a-vis our shareholder commitments, dividend policies of importance. We want to indicate the dividend expectations, notwithstanding the business environment. We want to make our group PZU group resilient and ready to pay off the dividend as per our commitments.

Just to relate to the revenue part of the question, as Maciej said, look at what is going on, on the modern insurance segment. some time ago, we would have other assumptions for the development of the market. But now we must be neutral towards how the market fares. We must be flexible in order to be able to respond. If there is something that goes canter our expectations we can make best use of the robustness of the PZU group in order to be able to switch the focus a bit. Look at what -- how we fund our core. That's the fourth quarter of the year with our core is below 90% level which means the system we've adopted has proven operational, has worked out. We must also act on scale. It's goes with be on hand any question. The margin in the motor insurance is delivered on -- and whenever possible, we are trying to take advantage of what is going on in other segments to A quick regarding, ladies and gentlemen, some time ago, the health segment would require a lot of the Board's attention.

Now the situation is define -- we have built up our competencies. We have built up the scale. We have invested in technologies. Why? Because this is a fast track towards the growth. And we also keep on responding to the needs of our citizens. Look at investments. We have developed our investment portfolio. There are no new products that we've began to offer and they've proven successful. Just to tell you, we can respond ad hoc in non-life insurance, we must work on effectiveness and the power of our tight agents. The [indiscernible] channel as well as the other channel, well, have already seen a number of initiatives to boost our effectiveness. Anyway, if our rivals win on price, that's something unacceptable for us, number one. Number two, we mounted cater to our commitments. So that's basically the background and we stay responsible right? Because we announced until now for any single mistake. Maciej said, we are following up on the market developments -- of the model trends look the way they do. We try to compensate the working over advantages in sectors. So we are mindful of that.

We are mindful of the cycles. But there is another background that we must [indiscernible] we've gotten fast structural investments. But bear in mind, these are going to be overly well up, not something sustainable, but that's something that we must invest ourselves in otherwise we will miss the chance. And all the way long, we present the solid position of our group. Look at how our banks performed in the first 6 months of this year. the situation was very complicated, and the banks had plenty of challenges to respond to. They were has been as the ones that we saw in the insurance business. To wrap up, our power [indiscernible] and diversification. We are present in diversified segment and our team can respond and train every to take advantage. We've got lots of things to do to better our effectiveness in technological that is something that we will pay back as soon as possible.

A question from PKO Security. What was the solvency ratio if we included the 2% buffer?

Well, obviously, it would go down, but that change would not be significant. We'll present the results for Q3, and then you will see the effect of this 2% buffer because it will already be in force. There are also other indicators that will improve our solvency. So you will see this for yourself. And we decided to present data today without speculating on what would be had we adopted a given indicator or complied with the with regulations that are about to enter into [indiscernible] in the future. So we presented the result and the results in the -- under the current currently binding regulations. And in Q3, we will show the results that include the 2% buffer. CEO.

We announced this at our earlier conference and as we, in this group always respect our -- like we say true to our word, we'll show it to you in Q3.

There are no further questions online. And just -- so I would like to wish you a nice day and remind you to take a look at our ETF offer.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Good afternoon. Welcome to the press conference dedicated to the discussion on the financial results for Q1 2026. And we are going to have this meeting moderated by CEO, Bogdan Benczak, as well as Maciej Fedyna, our CFO.

Mr. Benczak over to you.

Good afternoon. Welcome to the Financial Results Conference following Quarter 1 2026 of PZU Group. It is my pleasure that I'm going to co-moderate this conference for the first time together with that Maciej Fedyna responsible for finance and risk arena at PZU Group.

Well, let us begin, shall we. First quarter 2026 PZU Group well, we consider it a very solid opening in the current year. As far as the market situation goes with respect to our organization, well, it has been less favorable as it was a year before. What are the factors behind? Firstly, volatility on international markets. Secondly, the fact that this year's winter season is indeed very wintery, unlike what we had in the past years. However, we are proud of the fact that we have generated record sales equivalent to PLN 7.8 billion highest result ever at the first quarter. Simultaneously, we managed to have PLN 1.4 billion in terms of net profit.

This comes as the aftermath of a very conscious risk management and a diversified risk handling scheme. Maciej will elaborate on various factors, that had a lot to do with this result following Q1. But as said, Q1 has been concluded, I think very stable position. Solvency II ratio 239%. Yesterday, the Supervisory Board recommended to pay on the dividend in the height of [ PLN 4.8 ] per share. Dividend yield equivalent to around 7.6%.

On May 12, there's been -- there have been 16 years since our debut on the also Stock Exchange. In that period of time, we paid almost PLN 37 billion in dividend. You can see the graph attached. Total return obtained by the PZU Group. For the dividend, our recommended dividend is equivalent to PLN 4.8. Record date shall be September 17th current year and the payment date as likewise October 8th, 2026.

Let me take this opportunity to stress our credit rating is stable, equivalent to a minus with a positive outlook backed by or as the result of Solvency II ratio at almost 240%. And you know best what our investment portfolio is composed of that is almost 80% in sovereign bonds. By the same token, we are very effective in terms of reinsurance production.

This year, in the beginning, we strive to consistently improve our market standard. We informed you about the fact that we had signed the acquisition agreement for the Ukrainian insurance operator, and we did it -- MetLife. We did it because it was possible in the first place in the second place. Ukraine is a market that we have recognized very well. We've got both the people and financial resources and our expertise counts about as well. That was another factor behind.

Moreover, we took advantage of all the instruments available in Poland to mitigate various geopolitical risks and that might be associated with a said takeover. So whenever possible, the PZU group is a very -- is very apt in enhancing our market strategy.

In the Poland, we consolidated our assets with LINK4 in order to fully implement a multi-brand strategy. And again, to be able to mitigate various risks, which are associated with the fact that we are indeed 2 separate entities. In parallel, we want to profit as much as we can from the potential of Link4 brand. But again, the moving question is a very much about simplification and very much about greater efficiency for the acquisitions plans.

In terms of MetLife Ukraine, we would like to conclude the regulatory proceedings by the end of this year and for the LINK4 legal merger, it is to be brought to fruition in Q1 2027.

Our growth, what is it based on? It is based on in the first place the scale and second of all, the value we generate from our customers. In 2026, we grow specifically in the area of non-motor insurance, as regards to non-life insurance sector. I'm proud to see we've been consistent in growing in the life insurance part of our business. At the same time, the health pillar is a very important contributor as well as our TFI. TFI are also very, very handy in getting the portfolios of our external clients.

Let us not disregard the fact that various technologies come to our benefit. MojePZU platform has gathered around 6 million users. If we were to compare Q1 against the results obtained in the previous 2 years, what is striking? Well, for the results of Q1 2026 against all the odds and all the negative factors, all the unfavorable regulatory surroundings, it is evident that -- the fact that we are diversified in our operations. Thanks to this, we managed to guarantee very solid results. The greatest factor in question, revenues from insurance, that is PLN 1.254 billion, then investment portfolio, PLN 655 million. Operating margin accounts for 25.3%, and non-life insurance combined ratio standing at 86.8%. Given the current economic cycle and given the fact that in Q1 we obtained a greater frequency of claims resulting from adverse weather conditions, especially in the winter time. With all this in mind, we are very happy to have seen we have, in fact, delivered this kind of result for our shareholders.

Let's move on. We will continue on building up our caring strategy, especially with regard to distribution. Importantly, the odNowa program is set to ensure even more efficient operations of our tied agents. For the handling of claims, we are well set to have a new system. The operational implementation should start in H2 2026. And in H1 2027, we will see the first outcomes. Currently, we keep improving our actions in this area.

Here, we have accommodated a number of actions that will make us more agile claims handling wise. Moreover, Innovate PO is a number of action programs that we've committed to, plus we sell our ETF whenever possible. MojePZU platform, well, this platform should be a strategic way of communications with our customers. After Q1, the platform in question has serviced to as many as 6 million clients. The health pillar has seen the further extension of our in-house medical network. At the same time, we've been following very closely the overall situation on the market and likewise, we are planning on to expand our partnership network.

OdNowa program, well, ladies and gentlemen, I have said on numerous occasions that our tied agents are indeed our competitive edge against our rivals. And now we are trying to do our best to take advantage of it as much as we can. And turned out it's precisely why we have decided to roll out a number of technological solutions. Such that will help us better handle the needs of our customers.

I have stressed a lot. Our goal is to eliminate our debt. And to this end, we have introduced a number of technological solutions. We go and integrate LINK4 entities and multi-brand strategy is in place.

Changes in claims handling processes, improving efficiency. That's another charter of importance. We have managed to shorten the average time of claims settlements. Claims ratio has also gone down likewise. We want to increase the share of resolution in claim settlements. In a comment part, Maciej will tell you more how these factors get translated into the change in the so-called triangles. Something very important for the reserve of pilot.

Innovate PO is another focus area. By the same token, we have prepared the first publish tokens now listed on [ WSE. ] Our plan is to implement other similar products. I always reiterate everyone and PZU is a salesman. Therefore, let me draw your attention to Point 5. By the end of this year, we will have had a special promotional campaign so please consider buying this product, which is a very solid one, indeed, PZY EDF.

Let us now compare where we are in our journey of strategy and lamentation at the beginning of 2026. Where we have -- had a solid record-breaking result after Q1, PLN 7.8 billion, PLN 1.4 billion in terms of net profit. And these 2 figures are notably something that very much is in sync with our strategy. For the dividend, we have recommended PLN 4.8 per share. This year, we managed to achieve the ratio as set in our strategy for this year. And just currently was discussed also with you. The dividend level was no smaller than PLN 4.4. So much for me, ladies and gentlemen, now I would like to hand you to Maciej Fedyna, together with the click.

Good afternoon. My name is Maciej Fedyna, and it's my great pleasure to present to you the group's result for Q1 2026. It's actually my debut, and I'm glad that this debut takes place in mid-May. Actually today, we are celebrating 16 years from our IPO and it overlaps with my debut today in front of you.

I would like to start by elaborating on the dividends. So yesterday, we have recommended allocating PLN 4.8 per share as dividend. And an additional comment on my part is that our recommendation is very much future-oriented because it takes into account the planned acquisition in Ukraine, but we need to obtain all relevant authorizations. In 2027, we are expecting change in regulations regarding capital buffers for our sector, and this is important in the context of our group solvency. Therefore, we have recommended the dividend at PLN 4.8 because it gives us a very comfortable situation. And we can rest assured that our group will continue to keep a high solvency ratio and a coherent dividend policy. So we have future-proofed our dividends in short for the year 2026 and 2027.

Now moving on to Q1. We had a well-balanced operational activity, solid parameters, such as the combined ratio and the margin in life insurance. These were the main contributors to the result for the shareholders of the parent entity from other than banking activity at the level of over PLN 900 million. And if we include the banking leg of our activity, we can report PLN 1.362 billion.

I will not talk at length about it, about what factors influenced that there were changes in the [indiscernible], which had to affect our group's results. Also, we had to handle additional tax on the banking sector. But well, these are all factors that you're familiar with, so I will not elaborate on it. But I would like to focus on the factors that have influenced our insurance activity. So year-on-year, we have grown by 2.3%, and it's the best result in our group when it comes to quarterly results. If we examine those figures net, we'll see that the value in the reinsurance contract is lower this year than in the previous year. And that's why we have improved dynamics in net figures.

Now if we analyze the profitability, I would like to tell you that we have 86.8%, which is a -- this is our combined ratio, and this is a very good result in non-life insurance. You are probably aware that this level of results is unachievable for our competitors, while we actually deliver it consistently.

What has contributed to those results? First of all, winter that was -- that has already been mentioned by Bogdan, it was a good season for us. We're all aware that winter this year was not unusual, but very different than winters that we had in previous years. So weather conditions did affect our results, but only slightly. And we might analyze individual business lines that were affected by the severe low temperatures. And I would like also to mention that this affected not only in Poland, but also the politic states.

So agricultural insurance, we had a number of claims from farmers due to frost. Also in non-life insurance, we had an increased number of claims due to damaged buildings and damaged farming equipment as well as heating installations. Basically, these damages entailed more costs this year than in the previous year.

Now modern insurance, this is always interesting. They were also affected by the weather. However, the MOD and the MTPL were affected to a different degree. But to comment upon it, I would have to give you a broader perspective. So in MTPL in Q1, we have noted a lower frequency of claims than in the previous year, which is good news. We have also started to note significant income in -- that is generated by a speeding up of our claims handling because we have a growing number of claims that end in settlements. We have also shortened the average time from reporting a claim to inspection. And the combined positive effect of a lower number of claims in MTPL and improved claims handling process allowed us to compensate for the difference between the average written premium and the growth in the number of claims. And this is good news.

That's why the combined ratio in MTPL was so good and the same goes to mass insurance, 93% in combined ratio and also in corporate insurance, this actually effect was way less noted. The weather has -- the winter weather, has caused an increase in the number of claims in MOD. However, from the beginning of last year, we have noticed a negative dynamics of the written premium in MOD. And the effects are quite visible, namely reduced margin also in our portfolio. To counter that, we invested a lot in our procedures.

Also procedures regarding establishment, the amount of the premium because we are well aware that the customer who wants a comprehensive coverage. So MOD and any other insurance policies, motor policies and also other types of insurance, such as non-life insurance, our travel insurance, often, those clients are small and medium enterprises. And these are actually our target clients. So we want to make sure that we attract them and that we offer them a good value for money in the short run and in the long run. So this was one of the factors that have affected our profitability in MOD.

We have also recognized the loss component, which actually should be -- should deserve a separate comment, especially when we analyze the results year-on-year. This year, we had to pay up PLN 63 million. And the previous year, we actually earned PLN 64 million. So the difference is to our benefit, and you can find the figures in our reports.

And regardless of the effects of the weather conditions, the motor insurance in the mass and corporate sector alike is quite good. 86% on non-motor in mass insurance and above 50% in corporate insurance. So well, yes, we're quite proud of this result, especially that the non-life insurance, property insurance are our growth engines. Sometimes we even report 2-digit growth in those areas in terms of -- in double -- sorry, we have a double-digit growth in those areas. What it goes up is the premium, the absolute numbers, also the amounts and individual policies, which is good for our image and also good for what we can offer to our clients because nothing damages an insurers image more than a sense that the insurance sum was inadequate after a loss is reported.

Let us move on to life insurance now, which contributed positively to our results as -- in terms of growth of income by 7.6% year-on-year, and the margin was also quite high at 25.3%. And last year, we have celebrated exceeding the number of 0.5 million of policies. So this product line is growing significantly. It generates a substantial margin. So it is something we can be proud of.

Also in group and individually continued insurance, we can also report solid growth, which goes against the negative demographic trends that we are observing in Poland. So these results show that our group can effectively develop and sell insurance policies hence to adapt our products to our clients' needs that do change also because of the demographic situation. So this is the basis for our solid growth in the margin, which is at 21.7%.

Another reason for us to be happy was the drop in number of debts and lower payments due to debts. Let us have a glimpse into investment results. Profitability at 4.8%, which is the outcome of a very stable structure of our investment portfolio, 87% in the entire major investment portfolio. This is what we are looking at. That is within the banking business, debt instruments, 73% government debt. Last year, we took a number of actions to stabilize the profitability situation from the debt instruments.

So you can see, regardless of somewhat smaller levels of interest rates, especially in January and February, March stood out in these terms. Against that, our results here are very favorable. There might be some deviations in the actual pricing and implementation of papers, but for the capital instruments, there might be some further deviations. At times, we get the question, how does it relate to stock exchange ratios? Bear in mind, there is a difference. We've got very like single exposures, which had decoupled from what is going on in the stock exchange. The fact is that last year, we performed really solidly here. This year, less so.

Let me comment on the following. There is a smaller level of revenues from the property investment portfolio. Why did it happen? It happened because of the element of securing the cash flows, currency flows in property specifically. So swap is what we're taking advantage of. The point here were higher than last year in Q1. And the swap points were significantly lower year-on-year, and this is the contributor that has affected our results here. Looking at table, there might be some negative values. Anyway, the large part of the amount, which gets reported in the table is of a temporary nature. The fact how we handle at the table in months or quarters other than the end point of quarters and half years, there is a reverse trend. So negative value of [ 50 ] is of temporary nature and will no longer be seen in the quarters to come.

Now for the motor insurance market in Poland. Let's look ahead, shall we? The curve up shows us the price pressure. And it got maintained or even strengthened its influence in Q1. But after the closure of Q1, there have been some headwinds going. Number one, in the shape of some signs showing as the market has grown more sensible, how to price the risk in MTPL and MOD, which is good news for the entire market. Counter to that, there are new entrants on our market. And that is why we are getting the impression that the factoring question is the low price. And that factor is important for the competitiveness of the offerings, especially in the external channels. But against that, we've got our own channels, our internal channels, thanks to which we can sell irrespective of that particular volatility.

Life insurance market in Poland. We've been performing pretty stable here. And we've got a dominant market share for the fixed time periodic premiums. For the single premium dynamics, we are even stronger. Anyway, we need to bear in mind that this market is very volatile. We would try to focus on the first parameter here in reported.

And now let us move on to the discussion on the health segment. Insurance has already been elaborated on by Bogdan. So let me focus on cost efficiency as well as operational efficiency. We approached our new digital offering to medical insurance and medical services at mojePZU. It is an important factor, which made it happen that we already have 40% of digital appointments, and it is something very effective for our clients as well as very effective cost-wise for our group. And the number of remote appointments has now almost achieved the level of 100%. So there is very little room for improvement here.

We strive for certain equilibrium. That is, on the one hand, we've got our in-house medical units. We keep extending work by takeovers of greenfield investments. And these will further improve the parameters. Assets under management has already been mentioned. Anyway, we welcome the fact that the CSM has been #1 for our contracts with TFI, not just on banking TFI, but the entire sector. It has happened. Thanks to the fact that our long-term products, pension products, specifically take out a very important share. And it plays out very well against market volatilities. So against these trends, we see a constant flow of revenues to our group.

And finally, we have reached the last slide for that part, Solvency reimbursement rate at 239%. This is good news also with the outlook -- with the future outlook. Last year, we managed to have PLN 4 billion of own funds, PLN 4.5 million. Capital expenditures increased by PLN 200 million, and this increase is broken down in the following way. Half of it is due to the fact that we extended the non-life insurance product portfolios, including the disaster risk, 25%, that is to be attached to market risk. The portfolio increased by 10%. The same dynamics is in the capital risk and the other part is to be attached to capital conditions on the banking sector capital requirements.

These are all official numbers reported for 2025. And we would like to start our next communication with you by showing a hypothetical reimbursement rate. Should we approach differently, the Solvency II rate, especially with regard to the fact whether or not we consider the banking requirements.

To be clear, following the regulatory change, the dividend payment capacity of our group will be more than that. So that's from me. Thank you.

Thank you very much indeed for the presentation. I encourage you to ask questions. Maybe let us take first questions from the room. Are there any? [ Andrzej Powierza, Citi Handlowy Brokerage House ].

Let us begin with what you ended at, that is the dividend payout the capital position of the PZU Group. I have two questions. One, the internal model rollout project, how does it fare now? Are there any other initiatives other than the group restructuring? It is something dependent on the legal affairs. But anyway, what can you do under the current situation to optimize the capital position of the group? That is one.

Two, getting to the topic of dividend. With respect to your strategic goals, the dividend now already goes beyond that threshold. What does it mean actually? Does it mean that the further you go maintaining the dividend status of PZU maybe when it decreases under the strategic goal and under the level that was recommended for the current year? What will happen? Or maybe given the fact that you consider a dividend company, the dividend will never drop.

Let me begin because the topic of internal model is very much in sync with my responsibility. Our position is a sum of many items. There are many factors to be taken into consideration. Thank you very much. You have brought up a number of topics. The internal model is amongst the most important ones. A disclaimer right at the start, shall we? In order to be able to apply the internal model as we calculate the internal model and to be able to display the results outside, we need to go through the entire process, get the proper regulatory consent.

For the status of works from the internal standpoint, we have already rolled it out. It is operational. We have calculations ready for many reporting periods. Therefore, we can see both the scale and other factors. There are different formulas that we can look at, and this results in a better risk assessment. Anyway, bearing in mind, we take proper care of the fact that our communication to the market is precise. We want to share the results of these calculations at the current stage. Reinsurance program selection is the field in question.

Another topic is how we select a portfolio for further growth, where we should grow faster, where we should grow less and this may affect pricing or the -- how we rate the risks. So there are some profits that we have started taking advantage of. But in parallel, there is a series of other tools that we can benefit from on provided, the restructuring does not go as wished for. Or If it is for some reporting reasons, we are not yet ready for Q1 2027 and need to put it out in time.

Reinsurance program should be our entry field for the capital market analysis. It is quite reasonable from the cost side. Additionally, we have identified a number of other leverages, one being the restructure of an investment portfolio. Ours is a safe one, extremely safe one. Should other options come up, we may still think how to reduce the risk profile. So I'm now going over various campaigns, various possible campaigns.

By the way, we approach this topic now for the sake of our own risk assessment. It is rather apparent, we shouldn't plan for any extreme scenarios because the forecasts say our levels of payout will rather be safe and will stay safe. We will pay under dividends abiding by our own dividend payout standards, where we'll adhere to the limits of the dividend payouts in the future.

And as far as the increase of dividend goes, I'm newbie here. So I'm looking at the CEO to read from his face, if I can comment on that, okay? I see that I can. So we have no forecast regarding the nominal value of the dividend. But our ambition is to keep the dividend at the amount that is not lower than the current one. Given the fact that the regulatory framework is about to change we want to, first and foremost, make sure that our company delivers on its commitments. We do have a specific dividend policy. And always, when we take decisions on the recommendation for the dividend amount, we take into account the current situation in the company and the situation on the market. Basically, we want to be predictable as a group. Thank you.

Are there any other questions in the room?

I have two questions. One regards the dividend and more. The current operating goals were established -- or targets were established in December 2024. A lot has changed since then. So I'm curious if we should expect any changes to the operating targets? And if so, what are the possible areas that might be effective. This is the first question to the management board that I have.

Well, yes, we do monitor on an ongoing basis, the implementation of our strategy as well as the market situation and market possibilities. I have found ourselves in a new situation, and we have a new management board. And we want to carry out a review of the current events, the past events and if necessary to revise some areas of our activity. Still, the bottom line of our dividend policy is delivering on our commitments, and this is not going to change.

My second question is as follows. Does the new Management Board see any potential for structural change in the group as far as the reinsurance policy goes? Or should we stick to same old? So I'm asking you if there are any plans to take greater risks maybe or investing in that area?

As you know, foreign expansion was one of the growth pillars of our strategy. And a part of this foreign expansion is reinsurance, active reinsurance. Q4 is the renewal period for the reinsurance business. And in that period, we have signed a number of new contracts. We are monitoring how this part of our business is developing. And we are not planning to revise anything in this area.

One question from me. I wanted to ask you about the Baltic states, a worse insurance result was reported for that part of the world. Why?

So as far as the profitability in the Baltic states goes -- well, the main factor there is the weather. So let us examine separately motor insurance and other types of insurance. So we have a number of corporate clients in the motor insurance section in the Baltic states. So this means that those clients have to carry out transport services regardless of the weather. They cannot afford suspending their activity. This means that this will always affect the motor insurance result and was one of the reasons why we had slightly worse results there in Q1 in motor insurance.

And another factor that explains the slightly worse results was the effect that the weather had on property. To put it in simple terms, when I talk to my colleagues from the Baltic states. And actually, I remember that there was also a question about the Baltic during my first press conference. Anyhow, I spent a lot of time there. And my colleagues from the Baltic States told me that just because of mild winters that we've been having, they forgot how destructive actually snow can be. This year, ice roads were opened in Estonia for the first time in 10 years.

Actually, I wanted to ask about the weather in the context of Q2. I'm curious if the -- I'm curious if we can already make some forecasts regarding the results of Q2 in the context of ground frost that we had in Q2. And another question I would like to ask is about the rising fuel prices. And is it going to affect the number of claims or the amount of claims or maybe it won't.

Actually, the [ question ] to both of your questions is, yes. The -- we haven't received a lot of claims regarding the ground frost, but we expect more of them coming in soon. It is too early to make any estimates regarding the impact of ground frost on our results. The loss adjustment process in agriculture is complex, and it takes time. And what needs to be taken into account are also the effect of compensation of losses once the crops are ready to harvest. Also, the share of fruit trees insurance is not as high as it used to be. So our exposure to risk connected with ground frost is also slightly lower than it used to be. But still, it is an important part of our business. So I expect that we will see the effect of ground frost on our portfolio at some point.

Regarding the fuel prices, their impact is not going to be that extensive because of the subsidies that were introduced, and they softened the impact of high fuel prices on consumers. What we did notice, however, in April and May, we've noticed a smaller number of motor insurance claims and we believe that it's connected to a different behavior patterns among those clients who only use MOD insurance and those who buy MOD and MTPL alike.

Are there any further questions in the room? Okay. I can't see any but if you have any question, you can ask it later.

And I have a question from PKO Securities. Can you give us more specific numbers regarding agricultural losses after the cold winter. That's the first question. The second question is, are you expecting an increase in claims in the upcoming quarters due to, for instance, drought?

So I will address both questions. We estimate the impact of the severe weather in winter, on agricultural insurance at PLN 40 million in Q1. It's too early to make any estimates regarding future quarters. What I can tell you is that few farmers buyout drought insurance, and the also drought is treated as a natural disaster. So we do not offer on a mass scale, insurance against drought. And as far as I know, this form of product is not commonplace on the market at all because it would be very expensive, especially in Poland because the soil conditions and the hydrological situation, yes, would make those products very expensive for the customers.

Actually, I would like to ask you about the reorganization of the PZU Group and Pekao S.A. So can you tell us more? Are those entities going to merge?

So the short answer is the term sheet is still valid. You can find all the milestones there as well as events that would trigger the merger. And among those events are changes in the regulatory framework. We have done our homework at PZU. And if the legislation changes, we know what we need to do to carve out the insurance and holding part of the activity.

So what are the possibilities that the piece of legislation will be voted in?

I'm not into estimating probabilities. So please relieve me from that question. I'm a legal counsel.

One more question in the room.

So if we are asking unusual questions, I will ask a question about the health segment because you have given us numbers. You're talking about optimization, but if I'm not mistaken, I haven't seen the quantified result of that segment or maybe I missed it. Maybe it was not on the slide.

Actually, this was not on the slide, what I can tell you is that we are happy about the double-digit margin in that business area. And we believe that there is a lot of room for improvements there. The top line is going up and the margin is going up as well. So we are on the same trajectory as we were last year in the health segment.

There are no further questions. So I will just hand over to the CEO to close the conference.

I would like to thank you once again for your attendance. As you have noticed, PZU has reported solid results, and this is a consequence of our approach. So -- we invest into improving our effectiveness, and we're operating model and our fundamentals. And of course, we do invest in promising areas. And actually, I would like to thank you and to congratulate you as well.

Thank you. And we would like to invite you to the next conference and to our GSM. Thank you.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Welcome. Today, we will be discussing the results of PZU in 2025 and with a special focus on Q4. Bogdan Benczak, CEO of PZU S.A. and Tomasz Kulik, member of the Management Board of PZU. [indiscernible] CFO of the group, will take the floor.

Good morning, ladies and gentlemen. Welcome. This conference will be dedicated to a very exceptional year. 2025 was an extraordinary year for the group. We had to face many challenges, but thanks to hard work and teamwork, we were able to achieve record high results and we are going to discuss this today. almost PLN 31 billion of premium, PLN 1.5 billion more than 2024 with the profit of PLN 6.7 billion and solvency of around 234%. And last year, we paid out PLN 4.47 dividend with a high dividend yield, and these are record high results for the group.

So dynamic income growth. Over 25%, PLN 6.699 billion. This is what we achieved. And out of this, PLN 4.5 billion accounts for insurance and PLN 2.2 billion comes from our banking activity. ROE stands at over 20%. And this is largely thanks to a high result on insurance, PLN 4.8 billion and good results of the investment portfolio, PLN 2.7 billion with a contractual margin of over 27% and a combined ratio at the level of 86.2%. And these are very good results. We have broken the record here.

And let me give the floor now to Tomasz, CFO.

So the main takeaway of this chart is the following. The distribution of the result of this year is a bit -- might be a bit different from what you were expecting. And I'm referring to how the group generated results in 2024. So now let me highlight a couple of differences here. The differences concern 2024, 2025 and different quarters.

So, we all remember that last year, the previous year, there was the flooding and this led to a lot of claims related to flooding. And in Q4, usually in Q4, usually, when speaking about the death rate and life insurance-related parameters, we analyzed them and this usually serves us to make estimates for the next year. And last year, we had to be quite conservative when it comes to the revenue. And this is largely because we are expecting a completely different behavior of the life insurance segment because I'm referring now to the death rate. But actually, how the death rate unfolded didn't meet our expectations, and we benefited largely from the situation here. And the assumptions changed in Q4. And this year, we are meeting a month earlier than last year. And this affects some processes, which usually appeared in Q3 and were moved to Q4. And at points, this might lead to a situation where it might be a bit harder to understand how to compare different quarters in 2025 and 2024.

So my message here is the following. The average result is PLN 1.6 billion, and this is significantly more than in 2024. We are an insurance and banking group. And the insurance leg has very strong foundations and have a look at the profitability and the combined ratio, it stands at 86%. And in Q4, it was similar. This means that we have a very strong position, speaking about the strategy for 2026 and 2027. The business is solid. The investment portfolio's performance is sound. There were some tactical moves in Q4 related to portfolio to freeze -- to keep this very good profitability for longer, but we'll discuss this later on. And the P&L is solid on equity profitability is over 20%. So this means that we should be optimistic about the dividend.

And as Tomek has mentioned, we closed the year faster 2025. So, in 2025, we scaled up our activity, and we expanded our complementary offer and the growth in non-motor was double digit. We are very happy about it.

The very good trend in life and protection insurance continues here. The growth is also double digit. And we are happy with the changes in the health pillar where the growth is around 14% like-for-like. Also, the number of external customers in our three TFIs has gone up as well.

Our credit rating is A- with a positive outlook. And the solvency ratio is very high as well. It's over 200%. After three quarters, solvency stands at 234%. This means that we have all that it takes to be very optimistic about the dividend for 2025, as Tomek has already mentioned. You know that according to our strategy in 2027, the dividend will stand at over PLN 4, PLN 4.05. So we are in a very good position to think about a very attractive dividend here.

And now our investment portfolio. As Tomasz has mentioned, a very good results when it comes to the deposits, 71% of our portfolio amounts -- accounts for sovereign bonds, and we have very good reinsurance protection as well.

Q4 and 2025 now. We were setting priorities for our strategy in Q4, and we think that there are great opportunities for the PZU Group to -- because of the improvement of the economic situation of Poland. Poland is now among the 20 largest economies and the purchasing power is growing. We would like to seize this opportunity and offer the best possible products to our customers so that we can make the most of this positive economic cycle in Poland.

But at the same time, we would like to drive the growth of the GDP, and we would like to offer insurance services, but also financing for investment projects that will contribute to the development of the Polish economy. But we know that there are challenges on the market. So I'm referring to MTPL here. We know that the market is soft, so to speak, and there are more and more competitors. Also, we need to prepare for the changes in the distribution market. The role of intermediaries is growing, but the group has a very strong chain network of own agents. And these are our special forces we would like to make the most of and we would like to expand. But at the same time, we need to keep an open mind. So we are considering other options to remain competitive in this aspect.

At the same time, as we know, interest rates have been going down. So, as a result, we need to take this into consideration in our deposits-related activities. And also any changes in the interest rates will have an effect on our banking activities. We have prepared different activities and set KPIs to prepare the group for 2026 and the challenges. As I've said, we are very happy with the record high results in 2025. But as an organization, we are getting ready for the challenges of 2026. And we will tell you about the initiatives we are going to support in a moment, but we have identified our weak points, and we have prepared a list of measures to be taken to become an unquestionable leader of the market again.

Let us begin with mass insurance. In that sector, we focus on modernizing our sales. We have planned, and we are currently implementing a new front-end system. In this system, we want to unify our approach, make it more consistent, which will make it easier for our agents to work, and it will also be easier to start working with intermediaries. We also want to change, optimize our tariffs and our underwriting. We have reorganized our organization in a way that will strengthen the data scientists team. We also decided to develop our machine learning models, and we have laid the groundwork for technical change by moving to a cloud. We also have a number of AI tools implemented in our underwriting procedures.

I'm very happy with how some of our products have changed. For instance, the PZU Dom. It has been revised, remodeled and our clients were quite enthusiastic about its new version. So this is a good case in point illustrating that we are able to develop and grow our products and the changes are very welcome. We intend to continue to develop our product portfolio, in particular, in motor insurance.

We have also introduced a new claims handling system, which is more efficient than the previous one. Tomasz Tarkowski is the person in charge. We hope that we will see the first benefits of this new procedure and the new system in 2027. Over the last two years, we have made a large progress in that area, but there is still a lot to do, and we can further improve our effectiveness.

Life insurance. I'm very pleased with the riders that we have added to individual insurance policies. Tomek will tell you more about it. We're pleased with the results, and we'll continue in that vein. We have also changed our group insurance pillar including life insurance, we also want to offer new integrated insurance products. For instance, PZU travel assistance in cooperation with the LOT Polish national airline.

We have also decided to introduce a stand-alone insurance in bancassurance. This is our response to low interest rates. Basically in response to low interest rates, we want to transform our bancassurance offer and to move from interest-based approach to commissions.

We also have launched a project together with Pekao Bank. And this is the way we want to proceed in the future, like to have more of similar joint ventures.

We are moving towards digital channels of communication with our partners and customers and brokers. We are introducing a number of AI-based automated solutions in our foreign companies. PZU in the Baltic states has been growing very well. Its combined ratio is comparable to our Polish branch. So, in short, our results in the Baltic states are very good.

A few words about Ukraine. Actually, I would like to share a few thoughts with you. Last week, I went to Kyiv. I met with our colleagues there. And I must admit that I'm very impressed with their resilience. They're operating in very difficult conditions. I'm also sure that the profit they generated in 2025 in Ukraine constitute a good basis for business growth even despite the difficult situation in which they are in. We are also growing our foreign inward reinsurance. We have -- our team has already signed a few contracts in this area. We also want to sign MGAs with chosen partners. And those partners are present on the markets in our part of Europe.

In 2025, we have improved the operations of our health pillar. We have invested into it. We've been growing organically. So this means that we have opened a number of greenfield facilities, and we continue to plan further investments. In 2026, we want to open new greenfield facilities and to carry out acquisitions. We also want to improve operations of our facilities. In particular, we want to make as much communication, make sure that as much communication as possible is in digital form. because this will make the health pillar of our activity more effective.

We want to seize the opportunity that the current financial ecosystem gives us. As I have said, Poland has joined the G20. The purchasing power of our clients is growing. This means that we need to optimize our investments and deposits. Also, I believe that we need to seize the opportunities that the Polish growing GDP is presenting us with. We want to participate in innovate.pl program, but not only. On the 17th of March, we will offer our first ETF fund. We'll also offer other investment products such as FIZ private debt and its joint undertaking with Pekao Bank.

Our main focus is organic growth as well as optimizing and finding innovative applications for artificial intelligence. Currently, PZU operates over 30 solutions based on artificial intelligence. And we're not resting on our laurels. We want to benefit from synergies that we have with PZU Ready for Startups program. This means that we are implementing some business ideas that have received positive reviews. We're also -- we have also introduced an AI assistant for our employees. And last year, this tool generated 1.7 million prompts.

In 2026, we want to deploy a new IT strategy. A significant weakness that was diagnosed after three quarters of 2025 is technological debt. It was -- that this weakness was diagnosed by the Board. That's why we decided to transform our IT framework to make better use of data and digital solutions. Whatever is possible, we want to use cloud-based solutions, artificial intelligence and so-called low-code-based solution. Our goal is to shorten the time-to-market to reduce our costs to improve the efficiency of our IT systems. Yet security is our top priority. That's why all our systems, especially the critical systems will be covered by the digital resilience mechanisms developed under our strategy.

In a moment, I will give the floor to Tomasz, who will tell you a bit more about the fourth quarter of 2025, which was also quite unique. As Tomasz said, we have drastically accelerated the process of closing the accounts for 2025.

And without further ado, Tomasz, I'm giving you the floor.

Thank you. As usual, we will begin with non-motor and non-life insurance. Let us begin with the written premium and revenue. Q4 was a 2-speeds quarter. The growth was at 2% year-on-year. We have observed good dynamics in non-motor insurance. The corporate segment rose -- went up by 5.9%, including construction insurance and property insurance.

Now motor insurance adjusted for Q4 2024. The market is quite saturated. There is an interesting ratio of MOD to MTPL. Interestingly, the business of property insurance is based on two pillars, the motor insurance and non-motor insurance. I mentioned this because this allows us to forecast better to have higher profitability and to be less dependent on underwriting cycles that we have been observing mostly in non-motor insurance. In life insurance, we're doing more of the same. And I think it's a good idea. In mass and individual insurance, we have a group of new clients and a group of returning customers. I think that the health pillar is the most attractive part of this business.

We have a strong competitive advantage with it over our competitors. Our offer is indexated. We are offering new riders, and this allows us to keep the growth between 2% and 3%, and 2.5% to be more exact. In individual insurance, just like with non-life insurance, we have two main tendencies. The first one is stable growth in regular business, 24% year-on-year. And this happens in the context of interest rates going down. This means that the return on deposits is lower and the deposits are the guarantees of our products. So the sales of life and endowment seriously went down, especially in the banking sector.

On the other hand, what we are witnessing right now is a shift from a single premium product to a regular premium product. This does not affect the rate of growth of the number of clients, but it does affect the written premium value. Here, the value of a single transaction actually is important. So, in health, the growth is double digit, both for medical clinics and other facilities. Own facilities have witnessed a significant growth and so have the partner facilities. This helps us manage the traffic of customers the right way, and we can keep the costs of medical procedures under control this way. Because we have control over the value chain that customers use. So we can control the cost, but at the same time, we can take care of the customer experience. Costs matter. So we are happy to see the fact that the number of online appointments is growing up. Actually, the number of appointments being booked online, the main channel website used for that purpose is called mojePZU, myPZU. And also the share of services provided at our own and partners' facilities is also going up.

There is one thing that this chart is missing though, but it's still an important thing to highlight. I have to say that this line of business has undergone a huge transformation over the last 12 months. And this line of business is about insurance, health medicine, labor medicine. And the profitability rate here is almost 13%. And there's a huge progress here. The contribution has gone up. So we are speaking about an interesting and very profitable chunk of our group.

Now assets under management in Q4, the trends from the previous quarters continued. And PZU is #1 in nonbanking and #3 in the full chart. Our share is almost 10% and ECS assets account for almost [ PLN 10 million ] with an increase year-to-year of over 50%.

Now bancassurance, as I've already mentioned, on the one hand, we are changing the model and shifting to a regular premium and I'm referring here to this distribution channel. So there are some risks here. The face value decrease and the free credit sanction. So these are the aspects here to be taken into account, but it doesn't translate into a decrease in the number of customers. So our huge effort in Q4 was effective, and you can see this in the results. Now the gross insurance revenue, here, the growth rate is a bit lower than Q4 2024. And this is largely because of what's going on in non-life insurance. And this is very visible in the first half of the year.

Now if you split it into different lines of business, well, different things are happening in different lines of business. But please bear in mind that the corporate business is growing significantly, almost 15% of growth year-on-year in insurance revenue. Now mass insurance, non-motor, 6.6%, as we have already discussed, but there is a drop in motor insurance. The adjustment year-to-year is over 6%.

Now life and individual business, again, you have double-digit results individually continued and with a slight adjustment year-on-year because of the high base largely. And this is related to the factors that I spoke about at the beginning, and I will come back to later on.

Our reinsurance program remains largely the same. Therefore, net revenue is stable. The cost of insurance services has gone up by 4%. The level of claims and benefits remains more or less at the same value with a slight change, although the portfolio exposure is larger. And here, importantly, the claims ratio has improved in non-life insurance. So previous years claims in the power industry sector have been solved, and this has had a positive effect. We have had stable profitability in MTPL, but MOD has slower margins now. The claims and benefits have gone up in the life and health part.

Administrative costs have gone up in Q4. And this is mainly because of the fact that salaries went up. First of all, there is the salary review each year, and we have to compare ourselves to the market. So salaries have gone up. And there were also one-off payments related to some collective disputes, which have been resolved. Higher distribution costs, 3.2%, a bit higher than the insurance revenue. This growth is due to the fact that non-motor insurance has had a larger share in sales. And here, the cost of distribution in general is higher. So actually, this is good. This means more products with higher predictability and profitability.

Now the loss -- the net loss component, which is amortization and other aspects. Here, these two items have had a negative effect and the overall influence amounts to around PLN 50 million. And last year, the situation was the other way around, where the loss component was offset.

By the creation of new write-offs in this part of the portfolio where the sum of cost is higher than the written premium or to be more precise, the insurance revenue. So the result in insurance is PLN 1.6 billion. And let me highlight that the loss ratio is low with the loss component is at the level of last year and the difference is less than 1% point. The non-life business is highly profitable. The depreciation is 120 points, but this is still a very sound profitability. Let me highlight this. And this is much more than we promised in our strategy. The margins in life insurance are over 20%. But we know that we can't use Q4 2024 as a benchmark here, and we all know why. Now Q4 ends with almost PLN 1.5 billion, PLN 1.74 billion and on equity, 17.6%.

And now let's deep dive into each segment. So a couple of things I haven't said so far. Now I've already told you about the revenues, so I'm not going to repeat myself. Now the costs have gone up by 6.6%. And what has happened here? So the current claims liabilities have gone up. And there is a higher cost of motor and life claims. And I'm referring here to the non-motor and life claims, and I'm referring to PZU DOM and PZU Firma. So this was partially set off by the positive evolution of the provisions from previous years, and this proves our conservative provisions policy and prudency, which usually has a delayed effect. So there is a higher loss component mainly in MTPL. So this -- the effect of these two elements on Q4 amounts to PLN 57 million. This was caused by a loss component in agriculture insurance. The operating result went down to PLN 415 million. Please bear in mind, though, that the profitability of this segment is above our strategic assumptions. The combined ratio on the whole segment in Q4 was at 89.7%, 96.1% in motor products and below 80% in non-motor. And this is very good news.

Let me briefly present to you the market situation and how the market may influence PZU's results in the coming quarters and years. In 2024, we had a number of negative trends. We had a 7% loss on TPL. The market started to show positive results in Q1 2025, and that was actually surprising. The price dynamics was at 7.6% in TPL in MOD at 3.5%, and we ended at levels below zero for both TPL and MOD. Currently, TPL is at minus 0.5% and MOD at minus 3.9%. What does it mean? If the number of claims goes up, we will experience pressure to deliver results.

An important piece of information, and please do not jump to conclusions. So this important piece of information is that even though MOD has been in the -- has been showing negative trend for three consecutive quarters, it has been quite profitable. At the end of Q3, its profitability was at 8%, which is a lot. TPL also delivered good results in Q4 despite the negative general trends. So, on the whole, even though the circumstances in which we operate are not ideal, it does not mean that the profitability of our portfolio or the profitability of our colleagues will go down.

So the Polish Financial Supervision Authority started to apply sanctions for certain price-related decisions taken by our competitors. So as the Financial Supervision Authority has decided to intervene, we'll continue to observe this situation, and we hope that it's a part of a systemic intervention and change that will overturn the trend.

Non-life insurance, corporate insurance segment, the cost, the expenses in Q4 2025 were closely connected to a large number of claims. We have made very cautious forecast regarding Q4 in careful estimates. We were actually so careful that in the end, the amount of claims paid out in that period was a rather pleasant surprise. This translated into a substantial increase of the operating results and improved profitability in all dimensions. in motor insurance, non-motor insurance of the corporate insurance segment.

Life insurance group and individually continued insurance. 2024 was not a representative year for PZU. We agreed that keeping profitability at the level of 30% was untenable. If it was, we would have written a whole strategy on how to do it. We have two main messages concerning life insurance in 2024. So I want to talk about the cost of claims. Here as well, we were very careful in making our estimates. We were not sure what we could -- what kind of debt ratio we could expect still as in post-COVID years in 2024, we have been consuming CSM in an accelerated manner. Under normal circumstances, this would have been spread over a few years and depreciated over the entire cycle of the insurance. And when you compare the revenue and expenses with the previous years, you will realize that it's actually impossible to carry out a year-to-year analysis. Also in Q4, we have changed the actuarial forecasts and assumptions by -- we changed it by PLN 67 million. All other assumptions for this year remained regular.

I just wanted to make this comment so that you can understand the mutual relationship of the two Q4s in question. Mortality. It might seem that the mortality rate has got back to normal. So we're at a level of 3.5% less than Q4 2024. We're approaching the statistics that we have known in the pre-pandemic period. So we might carefully assume that we can close the COVID chapter. Life insurance, individual protection insurance, the cost is basically the effect of the scale and the exposure of this portfolio. So the insurance revenue went up year-on-year by 23.8% and the expenses by 27.4%.

Well, margin, we've got high margins, good level of sale, including selling additional products, indexation. All those factors allow us to gradually and systematically build value from one quarter to another. This is very clear in case of group and individually continued insurance, where the growth from one quarter to another was at 5% investment results. We did not have a great quarter, but still quite acceptable. Actually, our CEO has just said that it was -- helped me out, and he said that this was an exceptional or extraordinary quarter, just like the whole year 2025.

We had good interest income regardless of what happens to interest rates. We had lower results from valuation and realization of debt instruments. We have decided to sell a few tranches at lower profitability because, well, we all know that the interest rates will continue to go down. So we decided to carry out this transaction.

So what you see in the results are basically, it's a small adjustment of our exposure to corporate debt. There were some press articles about it. PZU is a part of a consortium with a number of banks, and we're involved in that transaction. Other than that, we have proceeded in line with our strategy. We also had a lower performance of equity instruments, in particular, given the exposure to stock in the medical sector. Other than that, we have benefited from the tendencies on the capital market. For instance, we had a good yield year-on-year on our real estate portfolio. We have also had positive -- we have benefited from positive exchange rate differences in real estate valuations. So we see -- and this was connected to the fluctuation of exchange rate between Polish zloty and euro.

Solvency. Our solvency ratio shows that our good results are not only on paper, but they can be monetized. So we have good results in our own funds on investments adjusted in line with our policy and the dividend are expected at the level of 80% of the group's profit. And the second half of the year, we experienced an increased risk in banks and higher requirements and solvency. So we're closing the year with the solvency ratio at 234%.

Strategy 2025-2027. Gross insurance revenue. Given the current figures, we know that we need to speed up if we want to deliver on our ambitious KPIs. We said it when we published our strategy. We want to set the bar for ourselves quite high. This means that we need to speed up with delivering on our KPIs and the strategies that the CEO has mentioned in the first part of the presentation will help us to do so. We are still not flying on all engines. We believe that the active reinsurance will soon help us out build our exposure and that will help us to benefit from this large reinsurance capacity in our balance sheet. Net profit last quarter and last year, again, was extraordinary. And we have been stressing this many times. We have reported a profit year-on-year of 25%.

And let me stress that ROE from nonbanking is over 20%. And the earnings per share nonbanking is at the level, which is above our targets, [ 5.23 ] with the insurance business being highly profitable with a solid growth of the health pillar and asset management.

But now over to the CEO to wrap up.

Thank you, Tomasz. As you can see, ladies and gentlemen, it has been an extraordinary year with extraordinary results. There have been many different initiatives, which are aimed at preparing PZU for the implementation of our strategy.

As Tomasz has said on the revenue side, it's going to be a huge challenge for us, but we have identified all the challenges ahead of us, and we are prepared. We have all the KPIs setup, and we are implementing projects which are supposed to take us to our goals.

So much for this part. Over to Magda. We have discussed our records. And now over to you to -- let's move on to the Q&A.

So let's start with questions from the floor.

Congratulations on your results for 2025. I have a couple of questions. What do you think about non-life insurance in Poland and the potential for growth in 2026, given all the things that the competitors are doing? And do you think it's likely for the revenue on insurance to speed up?

And the next question is about Solvency II and the change in regime. When do you think your internal risk assessment model will be validated by the regulator? Do you think it's going to happen sooner in the first half of the year or towards the end of 2026?

Okay. So let me start with the second question. We think and we expect the model to be validated in 2027. Well, it depends. It also depends on the changes in the structure of the group because there is the project of reorganization of the group, which has been -- which is carried out together with Pekao. You know the term sheet has been signed, and you know that it all hinges on the legislative process. But internally, the company is getting ready for that for the split.

But let me stress once again that according to the current strategy of the group, the new Solvency II rules will take effect in January 2027. The strategic assumptions related to strategy and the dividend policy will be delivered. We are certain about it because we think that reorganization is an opportunity for us to optimize the group, both organization and capital-wise.

And speaking about the internal models, we are in touch with the regulator with the KNF. But we don't think it's achievable in 2026. Probably it's doable in 2027. but this to be confirmed by the KNF.

Okay. So before we go back to the question about the results, I do have one more question, though. So, as I understand, you will enter 2027 and the structure of your group is still uncertain. But let's assume that nothing will change. And we already discussed the fact that the new Solvency II is already included in your targets. But could you provide us with guidance because about -- around a year ago, there was guidance that if the Solvency II is implemented without any changes at all, there will be a capital excess in the group around PLN 1.2 billion -- PLN 1.5 billion. Is this right?

Well, it depends on how you calculate it and seriously. This is how I would like to answer this question. Where are we in terms of growth? So think about the outlook for this year and how it eventually evolves because no one expected this year to be so favorable in terms of the weather. So 2027 is very likely in terms of us reaching the KPIs from this strategy, and this is good news.

Also today, we can say that if nothing special happens, and I'm speaking large-scale events here that would have an effect, a negative effect on our insurance profitability. I mean there are no signs of anything bad happening in the economy. So, in this environment, we are likely to deliver around 125% to 200% in 2026 in terms of solvency.

And now speaking about our European peers, and we have really done our research here. Many European peers, large companies are speaking about 180%, 185%. So their targets are different from what we would expect. And also 2027, the debt from 2009 becomes mature, and this will be probably rolled out. And this is an instrument which you can also adjust a bit to your needs. But we don't know what the needs will be like. now because of the reorganization and the next steps to be taken.

So, to conclude, let me tell you that. No matter what happens, this debate about solvency shouldn't have any effect on how PZU will meet its obligations related to the dividend because this is what you can bring it down to, I think.

And now speaking about the market and, we also have our targets here. I think that the potential of the market is a growth rate of 6%. More in non-motor than in motor insurance. Motor insurance is quite uncertain today. Because as you can see in this chart, this is a very particular moment -- and the regulator has sent us a strong signal. And hopefully, this will be -- this message will be understood the right way. Some competitors were very aggressive last year. And in press releases today, they say that they don't want to sell insurance at any price. And we'll see whether this is actually true. Time will tell. But for us, it's an opportunity for the prices to grow. And this is already happening if you have a look at the renewal ratio. In 2025, the renewal rate was quite -- was poor because this was an extraordinary year. So we hope that this will be fixed. And I think that we are on the right track to get there.

So this is an important driver. It only takes a slight adjustment. And we really know that our exclusive agents are very profitable. This business is very profitable. And also the inward reinsurance has reached an unprecedented scale. And this can be very meaningful for the P&L because our competitors can't scale up their business this way. And we do have it in our strategy, and we're going to do it abroad. So I hope that we will be able to grow faster year-on-year than the market. And according to our assumptions, the market should grow this year by 6%, 7%. This is one thing.

So all the extraordinary things about 2025, the renewals, the -- our own agents who are a very effective channel of sale for us and a very important one. But we also have to focus on the intermediaries. So this is the second pillar of the market. This has changed a lot over the last years. We want to regain our position here because our policy was not stable or predictable and we had to face the consequences. And this is my goal and the goal of my management.

We have a great competitive advantage, which is our own agents. But at the same time, we want to build a very effective system of external distribution through multi-agencies among other ways. So we are working on it, both on the technology because we are implementing the front-end system. But we are also building a team that will work together with our partners closely because they account for 50% of the market already. So we have to take that into account.

I represent the Citi Handlowy Bank. I have two questions. So you said many times that last year was extraordinary. This one was also quite extraordinary because we had quite an impressive winter. So, I wonder if this anomaly, weather anomaly can affect the results of PZU in Q1.

I'd like to remind you that this winter started in the previous year. Yes, it was an extraordinary winter. It started in December. And it's important, not because of the snow, but because the snow kept falling and was falling at the end of December, and there were not that many claims. So we did what PZU is best at. We made -- we behaved carefully. And we decided to wait and see if after Q1, we'll have a surge in the number of claims and that part of those claims for losses suffered in December will be filed in January. This is something we took into account, and we prepared ourselves. Therefore, I think that the market in general will report worse results for January. Of course, I cannot guarantee anything because we're talking about the insurance market and the entire insurance market is based on uncertainty on certain future events.

So what we did at our end is that we adopted a responsible long-term approach. So we're not about muscle flexing or proving something to somebody only to suffer the consequences of it and the roller coaster in a quarter that would follow. Therefore, we have approached the results of the extraordinary 2025 year with a lot of -- with a pinch of salt. We are a market leader, and therefore, we need to behave responsibly. So I echo Tomasz's position. This is the time of the year when we need to be careful and take responsible decisions.

During the last meeting, there was a question about the Baltic states. So let me explain that the winter in Poland is different than in the Baltic states. One thing is the situation on the roads. In Estonia, actually, this winter also has been extraordinary because the so-called ice highways have been opened and namely the cars are driving on ice on the sea among individual islands. So we'll see what the final results for Q1 from the Baltic states are going to be. The conditions there were tougher than in Poland. And we'll see how it is going to be reflected in our portfolio. But this is something that we'll discuss when the results for the Q1 will become known.

I have one more question. The internal restructuring of PZU and creating a holding is a complex endeavor. So how much time will you need to adapt to the new legal regulations that are about to be adopted, the one that will allow you to do the restructuring. Please, can you explain what do you mean when you talk about restructuring?

Well, yes, I'm talking about the whole procedure from A to Z, the process of creating the holding. No, actually, it just step one, sorry, not the one where the bank is involved. We're talking about a period that spans over two or three quarters from the moment of getting the green light. So what we can do is that we can prepare ourselves, but without the new act entering into force, we have our hands tied. This means that we cannot take decisions, certain decisions that might be misinterpreted before the legal provisions take effect. They might be, for instance, perceived as acting to the detriment of the company.

So we can -- what we can do is to prepare, to carry out stock taking of all the agreements that have to be transferred to the new entity. We can analyze our systems, et cetera, but what we cannot do is we cannot start to negotiate with large partners, technological partners. Otherwise, it might be interpreted as acting in bad faith.

Are there any other questions in the room? I can't see any. So, maybe let us move to the questions from the Internet. Trigon Brokering House is asking for some explanations regarding the position of the competitors in non-motor sector.

Well, the situation is different in non-motor and in corporate sectors. Actually, the competition has become fierce in Q4. The non-motor sector has its characteristics. The clients that are usually more loyal. We have more returning clients and more renewals. That's true, and I would like to add one remark to this.

Please note that there is a very unique entity in our group. We are treating it as a unique distribution channel that has to have a given legal form under the existing provisions. This entity allows us to create incentives for our clients. And don't get me wrong, the incentives mean that we are offering a good coverage for a good price plus some advice on prevention. And some large entities are very interested in those incentives. So we kind of tell them how they can improve their procedures in a way that will make them less prone to major economic damage because they know that prevention is better than the cure. Like no, hardly anyone really is looking forward to payments for business interruption. They would rather not have their business interrupted at all. So those types of customers, they work closely with us, and they also benefit from the surplus that is generated in our results. So this is the competitive advantage that we have in the corporate sector that our competitors just don't have.

There's a question regarding investments also from Trigon. There was a drop in the investment result in insurance sector. And what is the run rate? What is the forecast regarding run rate for upcoming quarters?

This is a consequence of certain tactical decisions that concerned bonds, financial instruments, yields, et cetera. They had negative adjusted value and to make the best use of the circumstances in Q4, we decided to recognize. Those negative values, hoping that we will be able to report a higher return in future quarters. In 2025, the profitability of our portfolio was at 5.4%. And this the result was worse by PLN 300 million year-on-year. So I can say that this result was not representative. And we need to think that this portfolio has a potential of 5% or more and what has been reported for Q4 is just not representative.

There is a question regarding expenses without the insurance services. Why?

The expenses were so high. Well, we had a large increase of expenses in noninsurance business. But also, please note the revenue line, especially in the health pillar. If you analyze them together, then you'll see that there is some surplus. So this is how it is with our noninsurance operations. So mainly health, investment funds a bit. This is typical for the health pillar in winter. Just in Q4, we tend to go and see the doctor more often seasonality briefly. Now we're coming back to profitability and dividends.

Pekao Securities. The question is as follows. The CEO has mentioned attractive dividends. And can you give us some more information about it?

Are you interested in time lines or in values? Values, I guess. Tomasz, this was a nice attempt. Ladies and gentlemen, it's quite a complex process to issue the Management Board's recommendation on the dividend, and we have to wait a bit more for that. This also requires some consultations with other stakeholders.

But as I've said, we can allow ourselves to be thinking about an attractive dividend, which I think is included in our 2027 strategy. And then I might have already said too much, Tomek, haven't we?

No.

And there is another question about the 190% to 200% solvency targeted for 2026.

If nothing bad happens. This is calculated already according to the new regime? Yes.

And the last question here from Trigon. The effect of the 2027 changes on the equities.

Well, I'm not going to say more than there is included in our strategy. The changes will be implemented. And given that there will be no other changes in parameters and the reorganization, the changes will not have a worse effect than more or less -- rather 30 points versus the benchmark. So if it was 240 before the change with the new setting, it's going to be 200 plus.

There is a question about a bank in Ukraine. Would we be interested in buying a bank over there? This is a question from Pekao Securities.

This is a contextual question. Well, we look into every investment opportunity. We are very opportunistic about it. And this is also covered in our strategy. And this is how we are going to proceed. But our strongest focus now is the banks we already have here in Poland.

Another question from Pekao Securities. What do you think about the proposal of one of the political parties for insurance companies to spend PLN 750 million each year to modernize the police force and the firefighters.

Now already insurance companies dedicate 10% for fire protection to upgrade the fire protection services, both the national service and the voluntary service. So this will be my answer.

And the last comment from the same company is congratulations on bringing forward the announcement date of your results. Yes. And a big thank you goes to Tomek and his team for very hard -- extraordinary hard work. Yes, for an extraordinary. Yes. Thank you, Tomek, and thank you, everyone for the operations of the group, it has been a tremendous challenge, and we closed the year very, very fast. So, once again, I would like to thank all my colleagues who have contributed. I can only sign up to your words. And let me also thank all the people involved, all the auditors. Thank you.

Any more questions in the room? Thank you, and see you soon on the 14th of May. Thank you, and have a nice day.

Ladies and gentlemen, let us begin. It is my pleasure to welcome you here. My name is Marcin Kubicza, and I'm the Head of the Supervisory Board of PZU SA. I would like to welcome the company's shareholders. I also would like to welcome our CEO, Bogdan Benczak. I also would like to welcome the directors of our company. As per the agenda, I hereby open the Extraordinary Shareholders' Meeting, which was called on the 23rd of December 2025 at noon at the seat of the company.

Now I would like to ask the person who represents the voting system to give us instructions.

Good morning, ladies and gentlemen. When we start voting, you will have 3 options to choose from. Then the next screen is going to be displayed followed by documents submitted by the company. Thank you.

Thank you. Ladies and gentlemen, let us move to the second item on our agenda, namely the appointment of the Chairperson of the Extraordinary Shareholders' Meeting. Can you please submit your candidates?

Dominique Kalipska, I would like to suggest Mr. Leszek Koziorowski to be the Chairperson of the Extraordinary Shareholder meeting. Do you agree?

Yes, I do.

Does anyone else would like to present himself or herself? If not, then I would like to inform you that the draft resolution on the election of the Chairperson of the Extraordinary Shareholders' Meeting has been adopted, added to the materials and published on our website.

Now I will read the resolution, the resolution of the Extraordinary Shareholders' Meeting of PZU SA dated 23rd of December 2025 on electing the chairperson of the Extraordinary Shareholder Meeting.

Pursuant to Article 409 Item 1 of the Commercial Companies Code and Item 17.2 of the Articles of Association of PZU, the PZU Extraordinary Shareholders' Meeting hereby results as followed: Item 1, the Extraordinary Shareholder Meeting of PZU S.A. results to elect Mr. Leszek Koziorowski as the Chairperson of the PZU Extraordinary Shareholder Meeting. The resolution comes into force when adopted. We will have a vote on personal matters. Later, it will be done by a secret ballot. And now I would like to ask you to vote on this item.

[Voting]

Have everyone cast their votes? Has everyone cast their votes? So I close the vote. Can we see the results?

Ladies and gentlemen, in secret ballot, 575,470,988 valid votes were cast. Over 66% of the share capital was represented. In favor, 575,469,845; against, 69; abstentions, 1,074. The resolution has been adopted. Thank you, and I will hand over chairing the meeting to the newly elected Chairperson.

Ladies and gentlemen, good afternoon. Thank you for appointing me. I will just take a moment to prepare myself, and we'll continue our meeting. And can I get the attendance list and which shareholders are represented? Thank you so much, says the Chairperson.

Thank you for your patience, ladies and gentlemen.

We are at Item 3 of our agenda, namely we're now confirming that the Extraordinary Shareholders' Meeting was called correctly and is capable of passing resolutions. It is my task now to sign and check the attendance list, and I'm doing this right now.

I also have a few pieces of information to share. There are actually official announcements for the minutes that will be kept by notary Robert that I would like to welcome here today. 863 million -- excuse me, 575 million -- over 575 million shares are represented today, which account for over 66% of the share capital of the company.

You can take a look at the attendance list during this meeting. You can also receive a copy of the attendance list when the meeting is over. This is your right as shareholders. This is the first announcement that I had to make.

The second announcement is the announcement on convening the extraordinary shareholder meeting. Our company is a public company, so we have a legal duty to publish information 26 days prior to the convening of the Extraordinary Shareholders' Meeting that this meeting is going to take place.

We are supposed to publish this information in 2 places. One of them is a report #41 2025. It was published on the 26th of November 2025. We have also published -- we also published this information on our website.

On the request of one of the shareholders, our agenda was extended. And to inform about it, we published a report #42/2025 on the 2nd of December 2025. Both reports are available to you, and both reports include information about convening the extraordinary shareholder meeting as well as draft resolutions.

One technical remark. I will not read out draft resolutions. You have them in your materials. Unless one of the shareholders will put forward an amendment during the meeting, then we will read out the amended resolution.

Now I can officially state that the shareholders' assembly has been convened correctly and is capable to adopt resolutions as set forth in the agenda.

Ladies and gentlemen, this brings us to the end of Item 3 of the agenda, and we can move to Item 4, which is adopting the agenda. Does anyone would like to take the floor to suggest anything? If not, then in line with the report #41/2025, we have published a resolution that states the agenda, and it is -- was supplemented by the report 42/2025.

We added item 5 with this report, and this is a resolution on claims for damages caused in the performance of management. Therefore, I would like to ask you to vote on the resolution on the adoption of the agenda of the Extraordinary Shareholders' Meeting.

The agenda consists of 9 items. You can see it on the screen. You have been instructed on how to cast your votes. Is the system ready? It is ready. So we'll proceed to vote and the vote is public unless stated otherwise. So it's not a secret ballot.

[Voting]

Did everyone vote? Thank you. I close the vote. Can you please display the result of the vote on the screen? Thank you.

Vote #2 on the resolution to adopt the agenda of the shareholders' meeting, 575,469,845 votes were cast in favor, against 74; abstentions, 1,069. The Extraordinary Shareholders' Meeting has accepted the agenda that was published by the company's Management Board.

We can move to Item 5. [The speaker is not using the microphone, so we did not hear the comment. The interpreters cannot hear the comment in the room.]

The speaker says I voted against this resolution, and please put it in the minutes.

You mean the resolution concerning the adoption of the agenda?

Yes, this is correct. Thank you. Please put it down in the minutes.

This was the representative of Beata Kozlowska-Chyla.

We're moving to item 5, namely adopting the resolution regarding claims for damages caused in the performance of management. A resolution accompanying report #42 has been published with regard to this item. Does anyone would like to take the floor? I'm giving the floor to the representative of the State Treasury.

Given the letter dated 22nd of December, I would like to amend the resolution on claims for damages causing the performance of management. And I'm handing in the draft resolution to the Chairperson, and I kindly ask to proceed with it.

Thank you.

Ladies and gentlemen, the shareholder who suggested to put this item into the agenda submitted a new wording of the resolution. I will read out the resolution in its new wording. And can you please make a copy for the shareholders, so the Chairperson. The resolution reads as follows: the resolution regarding claims for damages caused in the performance of management. Pursuant to Article 393, Item 2 of the Commercial Companies Code and Article 8.3 of the Articles of Association of PZU, the General Shareholders Meeting hereby resolves as follows: The Extraordinary Shareholders' meeting of PZU S.A. resolves that PZU shall pursue claims for compensation for damages caused in the performance of management and authorizes the Management Board of PZU S.A. to press claims against Beata Kozlowska-Chyla, a former member of the Management Board for compensation for damages caused in the performance of management, while she was the member of the Board.

Item 2, the claims that the PZU Management Board can press regard lack of due diligence when hiring advisers to the CEO when the CEO was -- had his -- was performing his mandate.

Item 3, the company can claim the damages increased by the statutory interest. And the company may file a case in the common court. It can also ask for a settlement or initiate criminal proceedings. The Management Board can enter into a settlement to agree for instance, for payments in installments and to secure means to perform such contract. The resolution comes into force when adopted and the reasons.

Compensation for damages caused in the performance of management, the decision of the shareholder meeting is to repair the damage caused by the company in the performance of management, but the former PZU SA Management Board member named in the resolution, which is in the implementation of the requirements set forth in Article 392.1 of the Commercial Company.

The general meeting of this resolution will allow the Management Board to pursue claims for damages arising the performance of management that we have been designated a former member of the PZU as a Management Board. The results of the internal investigations carried out and the subsequent actions taken by the PZU SA, the information of which is in the public domain involving the filing of the notices of the possibility of committing a crime justified the filing of a lawsuit for damages against the Articles of -- in connection with the violation of the company's interest in the employment and supervision of the advisers to the President of the Management Board of PZU SA. She has been resolved from liability as the member of the Board in years 2023 and '24, which opens the road for bringing claims to restore donors by the company, not the full body of the wording of the reasons for our actions. And the resolution -- and I will hand over the floor to you shortly.

The third resolution will be, as I've been informed, will be displayed in the screen shortly. So now, you'll be able to have a look at that yourselves. But in the meantime, I can see there are some questions. So I would like to give the floor to our participants. You wanted to take the floor.

[It is being said over the mic. That's why interpreters can't hear.] We shall bring the resolution to display shortly as well as the reasons. Are there any other people wanted to ask -- to speak? I would like to present, just taken by Ms. Beata Kozlowska-Chyla as an appeal as added by a shareholder.

Ladies and gentlemen, I would like to ask you not to pass the resolution in question. PZU SA puts its secret information on that case, which leads to the conclusion that this motion is without justification. PZU SA acting for its bodies conceals from the shareholders, the agreement, which preclude my liability to any losses in April 2024 after I had been dismissed as the member of the Board.

The settlements were concluded. And the agreement in question, it was confirmed that all the claims vis-a-vis the company were exhausted. Consequently, the company confirms the correctness of the employment of advisers, the work and the fact that there are no claims in this respect.

In the agreement question, the company committed itself to pay for the sake of advisers to the President claims. Let us stress that the company conducted auditing actions within the scoping question. That is why the company entered into agreement with the advisers to the President, knowing the conclusions of the contracts, for the payment of claims by the company to the advisers.

Well, in that case, this striving for claims by the company in connection with the work of the advisers is devoid of any justification. A potential resolution of the Extraordinary Shareholder Meeting goes beyond the scope of the meeting. They do damage to the company and they do damage likewise to myself. The company has talked to me in an unprecedented manner. It did not present truthful information. It put a motion to the prosecutor's office about a crime that had not been committed. It all happened in a time when the agreement was already in place for 1 year and 8 months concerning the work performed by the advisers to the presidents. The circumstances of victoring by the company, such circumstances are against the law in all the possible aspects. PZU SA acting for its bodies withholding information from the shareholders does not say true about the proceedings.

The Supervisory Board on December 13 in a letter that was signed at the Ministry of State Assets claimed part after the conclusion of the explanatory proceedings does not state any incorrect demeanor in the working question. The conclusions as formulated were run by the former member of the Supervisory Board and now the Chair of the Supervisory Board of PZU SA, Marcin Kubicza, Employee of the Ministry of State Assets was committed to do -- to proceed with -- in a duly manner.

As the Ministry submitted a letter in the course of explanatory proceedings, the duly nature of his duties cannot be put in question as he was dismissed from a liability by the Board. It is, therefore, necessary to state that the current member of the Supervisory Board, taking part in the explanatory proceedings and by formulating the conclusions as mentioned, having also held repertoire of rights, had whole picture telling of performing the duties of the President duly. This was later confirmed by the agreement with the advisers to the President in April 2024. And Marcin Kubicza was a person who testified to the continuity of actions.

PZU SA withholds information from the shareholders when it comes to shaping the standards of employment and performing of duties by advisers to the President, their competencies, the competencies in the employment shaping the conditions for work and the conditions for settling work and the way work is performed.

In the media, we can hear doubt. The group was supposed to defend director, trying to undermine the previous Board, including myself. Such actions of the PZU are unlawful as an attempt to put against me the liability in a very selective process. And the key is far from substantive. It is necessary to be stressed that the work contracts were signed by the specialized bodies of the companies -- of the company. And there were also units of the company that supervised the whole process that resulted from the work contracts where it does and token agreements with employees are signed to terminate work contracts.

The contracts were shaped by the Director of HR department. His duty was to ensure all necessary in accordance with the legislation. Standards for compensations, et cetera, were shaped in line with the standards mandatory in PZU SA that had long predated myself becoming a member of the Board.

As regards the advisers to the President, it was confirmation for the President that the HR department does not state any shortcomings when it comes to the performance of duties and advice to the President in light of the standards which are mandatory the company, so vis-a-vis the way works were performed, for instance, in the context of the time of work. It is needed to be accentuated. The conclusions in questions were identical to the conclusions by the Supervisory Board of the company vis-a-vis one of the adviser to the President in August 2024 and also under participation of the member of the Supervisory Board of PZU, Marcin Kubicza. It was later confirmed in the agreement by the new authorities of PZU in April 2024 [indiscernible] and the duty character of actions taken by Ms. Elzanowska are not being put in question by the current holders of the company because Ms. Elzanowska stayed and remained employed as the HR representative. And the same holds true for the actions taken by Marcin Kubicza, who per annum receives his charge of liability by the authorities of the company.

It must be said that somebody put somebody. There was a mistake taken by the Director of HR, but also the current Chair of the Supervisory Board of the company. The professionalism of these people make this conclusion very far-fetched. HR Director is still currently -- is currently in office. The company many times stated correctness of the conditions of employment of the advisers of -- to the President. The company does not reveal necessary information, which makes an image -- a false image of an excessive number of the advisers.

In my time in office, only one adviser was employed. Afterwards, one adviser was employed in April 2024, another adviser was employed as of July 2021 and the third adviser was employed in November 2023. Given the size of the company, assets more than PLN 500 billion. This was a rather narrow group of advisers to the President.

Let me stress, after I came in office, I reorganized the department of advisers, which included 5 people. The aim was for the advisers to terminate the contracts with the PZU SA. The reorganization meant savings on the part of the company. The company assumed a false thesis that the work of advisers was fake. Furthermore, it disseminated untruthful information in that respect. It is quintessential to say that the company has never resulted to either myself or the advisers when it comes to the characteristic of their duties. And given this characteristic, my explanation, myself being a beneficiary of the work of the President and the testimonies of the advisers should be of key importance in the controlling process, in the auditing process.

This has never happened. The auditing question is duly coming in force only to confirm that the results had been put forward beforehand. The claims about the lack of duly character of the employment of the advisers is far from true. Those people had all the competencies regarding the necessary items, which -- the team was composed of people that had all the necessary skills and in line with the market standards. Two advisers were professors. Advisers were running their duties in full commitment to the managers of the company. They support me with their knowledge, skills, and they contributed to a very good manner of the management of the company, ensuring sound financial results.

I'd like to remind you that the profit of the PZU group amounted to over PLN 5 billion, and this was a historical result. Just to compare in the year -- in the previous year, the profit amounted to PLN 3.3 billion. In the year 2023, therefore, we have exceeded our KPIs. Market capitalization has increased by PLN 10 billion from PLN 30 billion in March to PLN 40 billion at the end of the year 2023 when I was in office. And we have achieved this despite a difficult market situation, despite the COVID-19 pandemic and despite the war in Ukraine. At the end of 2023, the PZU Group not only did manage to achieve its KPIs, but actually to exceed them. As a result, the PZU Group's market value has greatly increased.

So taking into account those outstanding results and the outstanding results of a daughter company, it is completely groundless to accuse me of mismanagement. The advisers duly performed their work. They were constantly monitoring the economic and social factors that affected the functioning of the company. They would talk to external experts. They will also talk to representatives to the company bodies, which can be confirmed by numerous witnesses, witnesses who are among the employees of the company, members of the company's authorities and external partners.

That is a large group, and the way it is managed is in accordance with best practices. They were presented and disclosed to the representatives of state authorities and not only. I confirmed back then, and I still uphold the position that the advisers duly carried out their duties and the important evidence that confirm that they did carry out their work well are being dismissed as irrelevant.

The company has no claims currently with regards to the advisers. And at the same time, it claims that a former member of the Management Board has exposed the company to losses by hiring the very same advisers. Advisers must assist the CEO. And they -- so I would like to remind you that they were doing it in one of the largest insurance groups in our part of Europe. The advisers were providing information to the CEO on urgent matters that had to be settled by the CEO. When the company accuses the advisers of being fictitiously employed this regard, as numerous evidence. I have taken on my role at PZU on the 13th of March 2020. So this was very soon after the COVID pandemic started. The official health crisis was announced in Poland. And from the 16th of May 2022, the epidemic emergency was introduced all over Poland, which was removed only many months later.

During that period, that is during the pandemic when the state of emergency was declared and during 3 months after they were revoked, the legal regulations that allowed people to work remotely were in place, and they also applied at PZU. During the pandemic, the PZU employees would do remote work, just like employees of other companies around the world. They were doing so to protect their health and the health and lives of their families. The CEOs, advisers and other employees at PZU SA at that time had to be adapted to the lockdown and to other limitations connected with the pandemic. And these circumstances are completely ignored by the State Treasury, by the company and by the journalists.

The advisers to the CEO had to work remotely, has to work online, although this was not the only way in which they were carrying out their duties. Therefore, it's a complete misunderstanding to use the register, electronic register of coming -- of entering and exiting the building as any measure that shows how much work the advisers actually carried out. And I would like to mention that still a large part of the PZU employees work in a hybrid format. Therefore, any resolution that might encumber me with liability with regards to the PZU is unfunded if the ground for it is supposed to be the hiring of the advisers.

The state treasury is abusing the right as a majority shareholder. This resolution has -- is unfounded, not substantiated. It affects my reputation. It affects the shareholders, and it also goes against best practices in listed companies because what the company is attempting to do is to hold a former Management Board member accountable for offense that was not committed and that did not result in any damages. Therefore, I believe that the company is acting against the law. And on top of that, it is withholding information on important documents and pieces of evidence signed Beata Kozlowska-Chyla date today.

Thank you. I would like to give you a copy of the statement, and please add the statement to the minutes. Ladies and gentlemen, does anyone would like to take the floor?

I saw 2 hands raised.

Good morning. My name is [indiscernible] . I'm a shareholder. Ladies and gentlemen, we have listened to a rather lengthy statement by the previous member of the Management Board. And if I understood her intention correctly, she was trying to address the position, the claim made by the State Treasury. We have also read the amended resolution amended by the representative of the State Treasury that also has new reasons.

If I understand the State Treasury correctly, they base their position on some of the public information that is not clearly defined and on some audit outcomes, also not clearly defined. I do not want to adopt this resolution on the basis that is put forward by the Minister of State Treasury because I think that this ground might not be sufficient. Maybe the minister has some -- has access to other knowledge than the shareholders like the aforementioned unspecified audit results. So my question to the Management Board is, is the minister -- did the Minister of State Treasury as opposed to other shareholders have access to some additional information? And if so, what kind of information it was?

As I said at the beginning, we have listened to the position of Beata Kozlowska-Chyla. We have read the position of the Ministry because he -- because it was presented in the resolution. And I, as a shareholder, I feel that I need more information from the company itself to cast my vote on this resolution. So I would like the Management Board to explain to us in what way Beata Kozlowska-Chyla caused damage to the company. What is the estimated amount of that damage? And what does it exactly consist of?

The second question is when did the company discover that it incurred a damage? Was the damage reported so that the Management Board can use its insurance policy to pay damages in this situation because there is a clear policy on how to handle those procedures that are deadlines. So I would like to ask the company if they respected the deadline.

My fourth question is as follows: If the whole case revolves around the CEO's advisers, so the CEO benefited from the work of the advisers, did actually the company ask the former CEO, that is Beata Kozlowska-Chyla, for specific information on what kind of work did those advisers carry out under the employment contract? Because if the company did not ask her, then tell me why.

Question number five, Beata Kozlowska-Chyla says that when she was revoked, the company signed agreements with the advisers, paid them compensations, and renounced all claims. Is this true?

Question number six. Can you tell us what tasks were assigned to the advisers of the CEO after Beata Kozlowska-Chyla was revoked from the position of the CEO in the period from this moment until the termination of the employment contract so that the new Management Board of the company can perform the employment contracts that were entered into. Is it true that Anita Elzanowska, who is the member of the Supervisory Board did contact with one of the advisers and the advisers asked her to assign him some tasks. She did not assign him any tasks.

Question number 7, if the new company authorities, that is the company authorities headed by Mr. Ole. So if the new company authorities fail to perform their part of the employment contract, namely they did not assign any tasks to the advisers, is it possible that the company makes, press those claims to the previous CEO for damages that were caused in that way?

Next question. Did you report the agreements to the court to check if they are valid?

Question #9, did the company turn to the public insurance institutions with a request to return payments to the social -- to the national social insurance for the reimbursement of the installments for the public insurance.

Next question. Does the company intend to claim damage for compensation paid to the advisers to the CEO before Beata Kozlowska-Chyla was appointed and after she was revoked?

Next question. Does the company intend to request that Beata Kozlowska-Chyla returns the benefits paid to the advisers and will take into account new contracts? Does the company want to claim damages for unduly paid premiums to the national insurance institution and to the tax office?

Question #14. Question 14, is it true that the company obtained expert legal opinion by Piotr Capital's professor in which there are conclusions that maintain. In the case of employee advisers, no crime has been committed.

Question 15, is it true the company has obtained opinions of authorities and of authority persons in the area of management? What it means to carry out advisory duties? Can the Management Board provide us with the statement on that?

16, this is what Beata Kozlowska-Chyla referred to in her letter read out by her representative a minute ago. Is it true? In 2023, the company, upon the request by the Minister of State Assets and after having received a letter by a shareholder, has carried out audit action on employment of [indiscernible] as an adviser. What are the conclusions on the set auditing procedure? Has the Minister of State Assets received the response on that? Is it true that no irregularities were identified in that course? Was it true not? This was also the subject of the meetings of the Supervisory Board members, including the current chair. Is it true that the Supervisory Board was determined to the Ministry of State Assets, in light of which no irregularities were identified?

And the Management Board present shareholders the fine conclusions from the course of these auditing procedures as well as the response that was handed to the Ministry of the State Assets because as a shareholder, I must -- I mean quite frankly, I feel a bit sidelined being a minor shareholder, especially vis-a-vis the major shareholder, but I would like to get the same access, pathway to knowledge, especially given the fact that the ministry had obtained the information. And under President Ole, this information would have been provided to regular shareholders, but I'm not capable of finding any information in this respect.

There is a number of questions I have answered, and that is why I would like to put them in writing to the President and the Chair of the Extraordinary Shareholder Meeting so that you can manage this item properly. In the meantime, there were other hands raised. Chair, please put it for the record. There were also other hands raised. Before giving the floor back to the Management Board, I would like to open the floor to other shareholders. There were 2 hands raised. You've got the floor. Go ahead.

I'm a shareholder. I have a slightly shorter question, and they come at a number of 2. Please give me information as drafting the resolution...

Can you give us your name?

[indiscernible] private investor. Can you provide information if during the process of drafting resolution was analyzed also the roles and responsibilities of key advisers outside of the Board, especially our Financial Director and Compliance Director when it comes to acceptance of transactions and ensuring legality of actions taken by the company? And yes, have those people been potentially considered as subject to claims?

Second question with regard to bringing claims. Can you give me the information? Has the analysis in question taken into account the tragic losses? This pertains to the term in office of the previous Management Board or maybe there was the continuity from the previous Board. This is the Article 29 Item 6. Information is withhold on damage. And point 13 is not taken into consideration, especially vis-a-vis the Polish Financial Supervision Authority.

Are you speaking of the liability of the members of the Board or the employees of the company?

The first point refers to the duties of the employees of the company. This is not the subject of today's meeting.

Liability in this agenda point of the resolution. The resolution question is adopted in line with Article 393 Item 2, Commercial Companies Code, and we are not entitled to bring to accountability on the employees of the company, which is the subject of this meeting. We are not authorized at the Extraordinary Shareholder Meeting to settle the lower layers of the company structure.

Thank you. There was another question apparently. Go ahead.

[indiscernible] Shareholder. Before asking my proper question in the first place, I would like to put it against a certain background, the personnel of the Board of PZU SA managing the bodies underneath during the voting in June 2023 on the resolution providing the net capital to the backup capital. The representatives of one of the member companies of PZU Group voted in favor.

When it comes to paying the dividend in PZU SA voted with the abstention. I never received an information on how the representatives of PZU voted. They conducted the fund in the amount of PLN 5 billion, PLN 5.6 billion towards the end of December. The agreement concluded in 2023, where we read there are provisions about the company will not recommend no dividend at all or sharing the profit unless 12 months prior to that, the company does not pay from fees fund. Have the advisers provided their consultancy during that meeting in June -- on June 30, 2023? On December 16, the motion was put forward by the Supreme Chamber of Control for OPD managing the open pension funds in line with the ruling of the administrative court that stated there are not only public duties, but also the duties when it comes to managing the public treasury.

We are here at a general shareholder meeting, not the funds or other entities within the group. That is why we're here to settle and reflect upon the resolution on claims for damages caused in the performance of management of PZU SA, not TFE or TTE. And I can't really recall the proper names that you're resorting to. So this lies perfectly beyond the scope of power of this company, irrespective of whether we speak of other companies belong to the group. Well, this lies beyond the scope of this very Extraordinary Shareholder Meeting.

Are there any other outstanding issues from the room? Prior to taking on our replies, I would like to exhaust the questions in the first place. So I will give the floor back to the Management Board so that I can relate to the questions that were answered.

But let me provide you with a reminder. The character of the resolution that we are going to adopt is a formal character because we are not as a meeting, a body or an entity of the system of justice. We are not here, an entity by the Department of the System of Justice and justice is the subject of common courts. President are going to answer the questions yourself maybe will delegate and right to answer to others.

It is a break for 15 minutes so we can have some technical preparations prior to answering the questions. These questions are very comprehensive and in light or of will provide the Management Board with appropriate time for preparation. Break up until a quarter past 1:00 p.m.

[Break]

Ladies and gentlemen, please return to your seats. All the shareholders and shareholders representatives complete here in the room? Have you already come back? It's 18 past 1 p.m. It is due time to reconvene our meeting after the break. We are all ready. I hereby reconvene. And now I would like to hand over to the Management Board and people who are authorized to keep you replies -- to give you replies to the questions asked.

Chair, ladies and gentlemen, thank you very much. Since the moment I was appointed, that is September 25, 2025, all the actions that led to settle the irregularities in the PZU Group in years 2016, 2024 are being followed up within the scope of notifying about the possibility of committing crime or bring claims by PZU SA and the framework of civil proceedings. Acting with due diligence, the Board has turned to external financial advisers to get their objective opinions prior to notification about a possible crime being committed. The aim is to explain all irregularities in the appropriate manner and for all that matters to be handed to relevant organs so that the PZU Group can now focus on business.

With regard to the position by the member of the Board, Beata Kozlowska-Chyla. First of all, the audit that was carried out in 2023 pertained not to the quality of work carried out. The audit concentrated on the possible conflict of interest, and this was the subject of analysis of the Supervisory Board in that period. Now when it comes to the settlements of the advisers, let me draw your attention to the fact that the potential regularities concerning the employment contract performance, this was disclosed or this item appeared after the agreements. The agreements were basically the form of termination of employment contract vis-a-vis which doubts arose on the later stage.

Now I would like to give the floor to Mr. Gudoski to comment on the matter of advisers. And can we also hear from you some justification why the Management Board has requested for today to adopt the resolution and to amend the agenda and relevant motion was handed to the Ministry of State Assets and why we wanted to act in full due diligence.

Thank you. Mr. Chairman, ladies and gentlemen, I'll try to brief. We have gathered here to discuss the resolution that would result in taking legal steps against the former CEO. This is a claim for damages that is based on the provisions of the Commercial Companies Code.

The subject matter of this and the role of this shareholders' meeting is not to assess the grounds for such a claim. Our role is to take a decision on whether the Management Board should pursue this claim or if it should abandon it until it is barred by statute of limitations. The agreements that were concluded with the advisers on claims arising under the employment contract are significant in proceedings on damages, and they are examined in the course of the proceedings. However, this proceeding is not supposed to be based on claims under the employment relationship, but it is supposed to be based on the company -- commercial companies code. This code provides for accountability of members of the Management Board for damage caused to the company.

It is possible to enter into an agreement with a member of the Management Board to release that member from their accountability. This is provided for in the Commercial Companies Code, but no such agreement has been entered into. Therefore, the Management Board that is faced with one of the most difficult claims, namely a claim for damage caused to the company by one of the former members of the Management Board. What makes it even more complicated is that this damage is connected with employment contract. And employment contracts are instruments, legal instruments that are very strongly protected, and they protect the interest of the employee. Now the claim is that those employment contracts were fictitious and that the advisers did not actually carry out their work. As we gradually came to understand that the company did not benefit from the work of some of the advisers decided to secure for itself a possibility to come up with claims against the former company's authorities because the former company's authorities were supposed to protect the interest of the company.

The shareholders' meeting is going to decide if we will open the proceedings. This is still not decided yet. And then we'll proceed to claiming any damages. Then -- only then if we start the proceedings, we will talk to the insurer of the member of the Management Board. And only then we will examine the employment contracts. And the employment contracts might be one of the grounds for making a claim for damages before court -- the court. If the shareholders' meeting decides that we should just allow this matter to be part by statute of limitations, then this resolution will not be adopted. However, I believe that the Management Board acting in line with due diligence should take measures, especially if the Management Board believes that there are grounds to believe that the company suffered losses due to neglect or actions taken by the member of the Management Board. And this is actually the matter that we are discussing during this meeting. Thank you.

We will -- I would like to tell you that if we did not answer all the 16 questions that were asked, here, we will provide you with an answer in writing under the Article 428 of the Commercial Companies Code. Are there any further questions?

I guess that you have already asked your questions. So do you have any statement to make?

Well, I must admit that I am regrettably not satisfied by your answer because you did not address the questions that I asked. You gave us a very general response. I'm aware that the CEO was not around when all those occurrences took place. So maybe he still needs the moment to familiarize himself with the matter and answer my questions. However, as a lawyer and as a shareholder, I would like to receive specific answers to my questions. And on the basis of your answers, I will carry out my own legal analysis.

A lecture on the theory of commercial company law is not something I need because I already know my legal regulations. So my question is, is it possible that all shareholders will hear the answers to the questions that I have asked?

Let me remind you that the CEO said that under the Article 428 Item 5, if I remember correctly, you will receive the answers to your questions in writing. The Commercial Companies Code grants the right to answer the questions in writing to company authorities. You have said yourself that your questions were very specific, very detailed. And the Management Board does not have enough knowledge to give you comprehensive answers during this meeting. Does the CEO agree? Yes. So that settles it for me.

You have 2 weeks to provide me with a written answer. And actually, the content of the answers is very important in the context of the votes. I would like to ask for adjournment of the meeting for 30 days so that the Management Board has enough time to answer those questions. And we'll continue the debate and the possible vote next time we meet. At that point, all the shareholders will have access to the information that the Ministry of State Assets has, and we do not.

So if I understood correctly, you have just made a formal request under the Article 408 Item 2 of the Commercial Companies Code to adjourn the meeting. So can you please give us a specific date? Today, it's 23rd of December. So I request that we adjourn this meeting until the 22nd of January at noon.

So you want us to reconvene on the 22nd of January at noon in the same place, right? So 22nd of January noon the seed of the company. I do not know the exact address. So is it your formal request?

I confirm a formal motion has been filed pursuant to Article 408, Item 2. So that we adjourn the meeting up until January 22 noon. And now I will subject it to voting before other items are processed.

Professor, can you comment on the outcome of adjournment of that meeting. Let me draw your attention to one sole fact, period of statute of limitation with regard to the authorities of the company.

Well, this instrument is constructed in a way that we've got 2 periods to deadlines 3 years since somebody has learned about the damage and 5 years, the other period mentioned. With respect to companies, it is rather nebulous. What's the precise moment when you learn about the fact that the damage has been caused to the company still for the statute of limitation, it ends with a closure of a year. So the adjournment of the meeting until January 22.

Well, what does it mean? It means there might be a potential statute of limitation for some of the claims that are due in that resolution. Additionally, some items, which are subject matters of many of the questions. Well, they boil down to one mechanism. Have the consequences been taken into consideration? Have the instruments be put in place that would be related to some invalidity of the employment contract in the layer of social insurance, tax office, employment relations, right? So we were trying to relate to the subject matter of your questions on block. That is we concentrate the claims. We base them on the Commercial Companies Code. The matter of a potential invalidity of employment contracts are to be considered pretax and are to be put forward to the court to decide and they are indeed one of the pretext of damage that has potentially been caused.

If some payment was done on the basis of an invalid agreement, first of all, the court needs to investigate whether or not that particular contract was invalid, and then if any compensation was due. The Supreme Court normally adjudicates that such claims must be concentrated in one claim. So there is no legal interest in having all the claims considered within the frameworks of separate proceedings because the rest of the matter is the court concentrates everything within one proceeding. So the request of the Board through the general meeting is something of that nature still.

You requested time of adjournment in accordance with the Commercial Companies Code. Well, the motion will be voted in a matter of seconds. Let me -- please let me say the resolution about the adjournment of the meeting until January 22, 2026, the hour of 12, the general meeting shall reconvene at the state of the company [indiscernible] in Warsaw. That resolution is now being put for voting. And as per the Commercial Companies Code Article 308 Item 2, we need 2/3 majority. If the majority is stated, we'll have the adjournment. If not, we'll proceed in accordance with the agenda.

Now we vote on the adjournment of the proceedings by January 22, 2026, noon. Please cast your vote.

[Voting]

Have you already cast your vote? I can see you have or maybe you haven't. All the votes already cast. If anyone wanted to still cast their vote, please raise your hand. If not, I conclude everyone has successfully cast your vote and now we'll present the results.

The resolution has not been adopted. In favor, 1,105; against 353,146,677; abstentions in the amount of 216,039,044. Therefore, we proceed as per the agenda originally adopted. So we have exhausted this discussion point. We are at 0.5. It hasn't been exhausted. Has it? But please bear in mind, we prolonged our discussion infinitely, but there might be some particular proposals. So we'll stay by the order.

Everything is clear. Chair, but I can see there is some internal confusion when it comes to the behavior of the adviser to the Management Board. We heard the lecture on what this resolution is going to be all about. And at the same time, we heard that the company will carry out investigation on the basis of which the Board will eventually take a decision whether or not they will bring legal claims about them vis-a-vis the former CEO. But at the same time, we hear from the adviser about a possible statute of limitation. And law this to be instituted by the end of the year. So please explain the matter.

Another item is this. Well, I'm some to observe. I have no reservations vis-a-vis the President and the legal adviser. The company is not prepared to approve the shareholders with decent information. So are you afraid of anything? Do you have any concerns? It is not something especially cumbersome to push a company towards a lawsuit, which will go on for years. So why haven't we received the full picture in the matter discussed? And the shareholder wanted to take the floor, [indiscernible] again.

My understanding is this. Well, I gather what Professor said, the resolution if passed is just a step towards a potential lawsuit. This is something that I do understand, and we do all understand the matter. But the problem is this, some other steps have not been taken, namely, well, it's something that would be thoughtful to do to result to the interested parties to provide necessary explanations before ever turning to the adoption of such resolutions and potentially bringing the former CEO to justice. Now we feel we are pressed with time that we are to adopt this resolution, in light of the fact that we have not exhausted all the possible mechanisms.

The agreements that we talked about with the advisers were instituted with advisers only not with the former CEO, but this is something of relevance for a potential liability of the former CEO of the company. There's one thing that I don't clearly get, and I don't get what the President has said, namely the agreements were signed as I hear preceding the moment in time in which potential irregularities made themselves apparent.

Well, it is hard to believe that such a professional entity would enter into such agreements without prior examination of that matter. So at a certain moment in time, the company is apparently surprised to discover that the agreements would not have been established.

Ladies and gentlemen, for the sake of clarity, this is the last statement because we can go about the meeting with such voices in an indefinite manner. So that's the last statement. All right. I can give you the floor, Chair.

Thank you. That's the very last question. Well, let me formulate one remark. You are committed as per the Articles of Association to make everything you can to respect the rights of the shareholders. Are you making any reservation?

Your statement, namely you will give us -- you will not give us the floor for questions. So let's not exaggerate. Shall we?

My very last question. if the resolution has been adopted, the company will enter into lawsuit. Have you considered as the company to explain all the questions related to the advisers directly with the former CEO to organize a meeting or something? Likewise, have you considered to the settlement with a former President in that? Will you be willing to give the last answer?

Certainly, President. Thank you. PZU is a law binding company. So we act within the limits of law, and we use the possibilities that the law gives us. I think in due diligence, we have asked the General Shareholders' Meeting to take measures aimed at clarifying the irregularities. As a result, you would be able to claim -- make a claim for damages if we establish that a loss really affected the company. So if you read the resolution carefully, you will realize that we want to use all the possibilities provided by the law, including a settlement. Therefore, I would like to ask you to vote in favor of this resolution. Professor?

Indeed, I may not have been precise enough. The period of limitations, which actually expires at the end of this year, means that the Management Board wants to have the possibility to decide whether it will file a lawsuit or whether it will file for a settlement. And the persons to whom such claims are made will have the full right to negotiate, make proposals, et cetera, in the proceeding on settlement.

Chairperson, I would like to remind you that this vote will be voted in a secret ballot. Actually, all the following votes are going to be a secret ballot until I declare that a following vote is going to be an open vote.

Article 413 Item 1 obliges me to remind you and officially state that a shareholder is not allowed to vote in their own case. Therefore, the representative of the former CEO is not allowed to vote. So just so you know, and I'd also like to put it down in the minutes that the voting rights of the representative of the former CEO are not going to be counted, and this is in line with Article 413 Item 2 of the Commercial Companies Code.

Without further ado, I would like to ask you to cast your votes. We are voting. I would like to remind you on the new amended draft resolution. The vote is open.

[Voting]

I assume that everyone who wanted to cast their votes did so. Therefore, I close the vote. The resolution has been adopted. 318,650,494 votes in favor; 1,069 votes against; 250,535,258 votes abstained. The resolution has been adopted.

[indiscernible]. I want to state that I voted against the resolution, and please put my position in the minutes. [indiscernible] repeats Mr. Chairperson.

Thank you. Ladies and gentlemen, this closes Item 5 of the agenda. We're moving to Item 6, namely changes in the composition of the Supervisory Board. Before we move to vote, I would like to remind you that one of the members of the Supervisory Board resigned from his position. This was Mr. Filipa Gorczycy. This was stated in the report 39/2025 of the 3rd of November 2025. Currently, the Supervisory Board has 10 members and 1 seat is empty.

My first question is, is there a member of the Supervisory Board that you would like to revoke? Remove?

If there are no motions for dismissal from the Supervisory Board, let us move on to discussing the nominations.

Dominique Kalipska, I represent the State Treasury, and I would like to suggest Jaroslaw Antonik to become a member of the Supervisory Board. His bio was published on the website of the company. I would also like to add that he received a positive opinion of the council on companies and that he fulfills the requirements of the law to fill this position.

Are there any other candidates that you would like to put forward to the Supervisory Board? None. Therefore, Jaroslaw Antonik was put forward as a candidate to become a member of the Supervisory Board. He was -- his name was put forward a week ago in the report #43/2025 published on the 16th of December 2025 and in the report 44/2025 published on the 18th of December.

We have called for the examination of the collective adequacy of the Supervisory Board in the context of suggesting Mr. Antonik as a new member. So let us proceed to the vote on the resolution regarding Mr. Antonik. The draft resolution is in your files. Actually, it was -- it was a draft resolution. Now we have added the name of Mr. Antonik to the draft, and we can vote on the resolution. Is this clear? We're voting by secret ballot. So we're voting in secret ballot until revoked. The system is ready. Please cast your votes.

[Voting]

I understand that all the votes have been cast. I close the vote. The resolution has been adopted, 385,738,605 in favor; 189,070,934 votes against; and 661,449 abstentions. As a result, Jaroslaw Antonik received the required number of -- resolution received the required number of votes. This means that Mr. Antonik has been appointed as a new member of the Supervisory Board and this exhausts Item 6 of the agenda.

We're moving on to Item 7, namely the adoption of the resolution examining the collective adequacy of the Supervisory Board. We have just elected a new member of the Supervisory Board and the General Shareholders' Meeting is obliged to adopt a resolution in which we assess the adequacy of the Supervisory Board as a whole. You have the draft resolution in your materials and the suitability assessment is on the screen. There are already 11 members of the Supervisory Board taken into account in this suitability assessment. And the suitability assessment that we are going to vote on has exactly the same wording as the one that was published in the report 41/2025 published on the 26th of November 2025. So is it clear for everybody on what resolution we are voting? This is going to be an open vote. Please prepare the system for voting and you may cast your votes.

[Voting]

Thank you. I understand everyone has already cast their vote. In that case, I thereby close the vote, and that is display the result. And the resolution has been adopted in the current voting have been 351,352,364 votes cast in favor; 189,053,460 votes against; abstentions, 35,064,164. And now there's going to be a formal item in the agenda that is the resolution on the cost of calling and holding the extraordinary shareholder meeting. Within the item in question, we've got a relevant resolution on the cost of calling and holding the extraordinary shareholder meeting also publishing the report to convene that meeting. So now I put this resolution to vote. This is going to be another open vote. So let us prepare the system. The system is ready. And now let us vote.

[Voting]

Thank you for having cast your votes. I close the voting. And now let us display the results. The resolution has been adopted. Votes in favor 419,308,146; votes against 155,867,951; abstentions, 294,891. So I -- this brings me to the point where I close this meeting. I would like to thank all the shareholders and their representatives for taking part in today's general -- extraordinary shareholder meeting. And above all, I would like to express my gratitude vis-a-vis the Supervisory Board in shape of Marcin Eckert, whom I thank wholeheartedly and the same holds true for the Management Board in the shape of Mr. Benczak.

President, I wanted to congratulate you as it was yesterday when the Financial Supervision Authority confirmed your candidature. So please accept my congratulations. Now you are a fully fledged CEO of the company. So again, congratulations. And again, many thanks go to all the participants, technical crew and our notary. And let me take this opportunity to wish you all a very Merry Christmas, time spent in your respective families. All the best for you, for yourselves, for your close ones, for all your friends. Please hand this wishes to all the people who can for you. And hereby, I declare this meeting closed. Thank you.

Good afternoon. Welcome warmly at the PZU Group results for the third quarter 2025 presentation. It will be led by our CEO -- PZU CEO, Bogdan Benczak; and Tomasz Kulik, CFO of PZU Group and Management Board member of other PZU companies.

Good afternoon. I'm extremely pleased to welcome you at the presentation of the PZU Group results after 9 months. That's my lifetime and first-time opportunity to -- for me, to manage this presentation. So please understand my unwanted mistakes.

Let me start with the key achievements and plans. As you have already seen in our press release, and in our stock exchange communication after 9 months, we've reached PLN 23.1 billion in sales with the consolidated profit of PLN 5.2 billion, capital position 234% of solvability and 246% of stand-alone solvability and the dividend yield for the dividend paid in October is at around 8%. aROE is at the level above 20%. That's a very good position, sort of a head start for me as the acting CEO of the PZU Group.

Let me stress that the growth that you've seen in insurance refers mainly to non-life insurance and in particular, non-motor insurance. I'm extremely happy with this result because this is close to my heart. We've had a major growth in foreign markets where we are present in Lithuania, Latvia, Estonia and Ukraine.

We've had growth in Life Insurance segment, especially in Individual Life Insurance segment. And we've managed to substantially improve the results after 3 quarters, our capital position is very strong. It's robust and figures are really, really good. The results after 3 quarters and parameters -- profitability and capital adequacy parameters will allow us to pay an attractive dividend in the next year and about the level of the dividend, well, the details of the dividend, if the trajectory is kept could be discussed the next year after the recommendations and the approval of the Management Board and the Supervisory Board.

Income and net profit more than PLN 5.2 billion with a share of PLN 3.6 billion from insurance services and PLN 2.2 billion from investment portfolio. We are proud with the results in insurance service increase of 73%. We do know, however, that the last year was truly exceptional. And we had some additional compensation PLN 222 million paid because of the flooding. I believe it's even more last year, we reported PLN 275 million more than PLN 0.5 billion gross of compensations paid.

So the third quarter, PLN 1.5 billion and 127% year-to-year growth in insurance service and 85.8% of combined ratio. This shows our diversification. We've got a pillar of insurance services. We've got a pillar of banking activities, and we are working to consolidate further our health pillar, so PLN 3.6 billion result in insurance service, cess PLN 2.2 billion on investment portfolio and combined ratio, as I said, 85.8%. This is a very good result. And we are also happy to -- with our high operating margin in life insurance and with this, we are able to get to an aROE at 22.1%.

After 3 quarters, we have a 2-digit dynamics in non-motor insurance. 2-digit is a success and it's a source of pride for us. We've managed to have a growth in this segment. This is a core activity, 77% extremely important for us, especially that the number of initiatives have been launched and actions campaigns for this segment, and now we see a tangible result of our efforts.

Individual Insurance segment has also seen improvement in efficiency in our sales network. We've also launched some new products. And here, we also have a 2-digit dynamics in Individual Protection Insurance segment. This shows that when you focus well and define your priorities, clearly, you can be really effective, and this is our case, and we truly deliver.

Health pillar. Again, 2-digit dynamics. We are particularly pleased with a number of results. We do see the room for improvement, but quarter-to-quarter and quarter after quarter, we are able to improve in this pillar. Tomasz will give you some more details how referrals to our network of branches -- own branches have improved. He will tell you what kind of tools are used and what tools are actually the best to improve the referral rate.

Indeed, as I said, we see the room for improvement, but we've been consistent, and we've been implementing a recovery program. And as you can see, the results are there. We are also happy to see a 2-digit growth in external customers number in our 2 investment fund companies, TFI. This pillar is on the rise and we look into the future with optimistic perspective. This is yet another source of diversification for our revenues within the group.

We've managed to increase the value of assets within the group by PLN 20 billion year-to-year. When you have revenue, you have a better solvability ratios. Our credit rating is a A- and positive outlook granted by Standard & Poor's Global Ratings. They've kept the Polish rating as well. So you see that the situation is stable. Group solvability -- solvency ratio is at 234%. We are above the EU average for European insurers. 81% of our investment portfolio is made of bonds, including 65% represented by sovereign bonds. We are aware that our investment portfolio is conservative, but it produces stable and predictable yield on deposits.

One more item effective reinsurance protection. Reinsurance program was launched some years ago. It turned out to be effective when we were struck by catastrophic events on the territory of our country, 45% of our reinsurers have AA rating and the remaining 55% half A rating.

I presented briefly the financial results. And now let me move to the priorities of the PZU Group for 2026, 2027. This is a sort of an opening statement as a person appointed the CEO of the group. We have a very strong financial position, thanks to our scale to our profitability and our diversification. We have a solid market share. We are leaders in Non-life Insurance and in Life Insurance segments with 30% and 44% of share, respectively, for both of them. We are growing in terms of scale after 9 months, we have PLN 23 billion in insurance services. We have profitability. We are profitable, and we are better than our competitors in terms of technical profitability, for non-life insurance and technical profitability for life insurance according to the data from the 6 months.

We are then positioned among the top European insurers. And let me point out that the PZU Group is a financial conglomerate, but we are diversified. We are #1 in Poland for non-life and life insurances and in top 3 for health. We are 30 among banking, #3 in terms of investment funds. And our Baltic-country companies are leaders in their respective local markets and contribute to our consolidated financial results.

I hope I'm not committing a blunder by showing you this chart, but this is a moment when we can be proud of our achievements. I don't know what the cost of PZU is right now. But as we announced our results, the price of shares has skyrocketed 61%. So that has gone down a bit. But since 2024, we were growing by 71% versus 46% of the week 20. So this is very good news and if you have a look at our European peers and their valuation, there is room for growth for us. And this is precisely our ambition, the ambition of the Management Board to improve our position respectively versus our peers.

So the group is likely to grow, and it will grow. But we are also aware of some negative trends on the market. That's why we're focusing on opportunities. So this means demographic and social changes and also the fact that the forecast for the Polish economy are positive. We would like to tap into the growth of the Polish GDP and take advantage of it because I think that the economic growth will have a positive impact on the capabilities of customers who will be able to take out more insurance policies and now the demographic and social changes. So the purchase power of society is growing. Therefore, we think that both investments and life insurance will grow and so will be the value of the property to be insured, and this will also mean some benefits for us through the amount of the premium and now the aging society.

Let me address that. We think that this means a higher demand for health and protection products, meaning life insurance. There is also a pressure related to the negative market trends, namely the TPL market is changing. It's moving more towards what we call the soft cycle. We are now nearing the soft cycle. But we can see that there is a huge competitive pressure in segments that continue to be profitable like the MOD and non-motor. So this is a trend we have to face because this is a threat. But at the same time, this is an opportunity, namely the fact that intermediaries are growing, 50% of distribution is now done through brokers and multi-agencies and this is a challenge the group has to face. Also, interest rates will be going down, and this will have an effect on the investment result, and this will also affect the contribution of our banking pillar to our consolidated result. And also higher corporate income tax for banks will have an effect on us as well.

Now these are our plans, and I would like to highlight some thanks as CEO, namely over the last 2 months, the group has done the following. We have set priorities for our initiatives and strategies. We have assigned responsibility for specific projects to specific people. And also, we have grouped initiatives. This will help us reverse trends in some market segments, but it will also help us stay the leader of the insurance market in Poland and we will be the leader in terms of profitability and the market share because we already got there but we will be also creating new solutions and products in the market.

So from my point of view, the most important thing for us is non-life and mass insurance. We have to improve our pricing here and there are also other initiatives leading to an improvement in the effectiveness of our sales network, and I'm referring to our agents who are our edge -- our advantage, and I believe that they will make a contribution to our results. But at the same time, I think that developing our collaboration with multi-agencies would be an interesting opportunity for the group because traditionally speaking, in this segment, the group was not strong and unlike our peers, our competitors, but I think, and I believe that if we make some moves in terms of pricing and tariff setting, if we modify our distribution and develop the right skills and if we have the right tools at the front end, we will be able to increase sales in this channel as well, keeping our profitability at the same time.

Also, now let me address the implementation of the new system of claims handling, and this covers both the non-life and the life insurance company. Obviously, the non-life company is a priority here because I can see that in this company, in particular, there is a huge technical -- technological debt, which is something I realized when I came back to the company. And I think that here, there's a lot of room for improvement of our profitability.

And now I personally would like to focus on Health. I would like us to carry out the strategy, which would lead us to the results, the target figures that have been provided for in our strategy, and this could be a strong pillar that has a positive effect on our operations. I can see room here for organic growth, greenfields. But also, we have an opportunistic approach here because we are looking for acquisitions. And we are doing this to improve the take-up, the utilization of our health business in our own clinics, facilities and also to address and eliminate the white spots in Poland. And I'm referring to the coverage of the territory of Poland with our health facilities.

So speaking about the investment activity, decreasing interest rates are a negative trend. We would like to manage our own portfolio in an effective way. But at the same time, we want to develop product offer for our external customers and partners so that the investment pillar can increase its role -- its share in the PZU Group's revenue.

Now speaking about motor insurance, we are relatively happy with this segment because it has a positive contribution to our P&L account, but we would like to grow outside through inward reinsurance. We have proven partners through the MG model and we believe that this will lead us to positive results. Individual life insurance is what we do, new products, activating the sales network to reach our target customers. So we would like to focus on individual continued products and we would like to reach the silver and middle age generations as well.

Now group insurance. So traditionally, it's a strong segment for the company. Currently, the margin is very satisfactory. It goes beyond our strategic expectations. But we would like to be more swift here and respond faster to the changing market, and we'd like to gradually transform here to change the group insurance into an employee's benefit made up of the insurance component, health component and also other elements to be used as a benefit for employees. Bancassurance, we are focusing strongly on the collaboration with Pekao SA and Alior, but we are active on the market. We collaborate also with other companies from outside the group.

Now international business, we would like to take advantage of the synergy. We've had some successful projects in our foreign companies. But we are also looking into how to make the most of our companies, let's say, in Ukraine for future projects like the recovery of Ukraine. And obviously, hopefully, the war ends as soon as possible so that we can take advantage of the reconstruction. But for the time being, the contribution of our international companies is at the satisfactory levels of the Baltic countries, combined ratio is at the level of the parent company. So we are very happy with that. Now the group is transformation and the growth of the organization.

Let me stress one thing. According to current strategy of PZU, the Solvency -- the new Solvency II regime was to take effect. This was the assumption of the strategy according to our estimates. So new regulations and a new way of appraisal of our assets -- banking assets. This would lead to a drop in our liquidity of 190% to this level and we were expecting this. And even at this level, we have a permanent contribution of the same dividend policy of the group. And this is our starting point. We are also undergoing the reorganization of the PZU Group. We have signed memorandum with Pekao SA and now the group, the PZU Group is getting ready for the baseline scenario and this scenario has been described in the term sheet. There are factors we cannot have impact on. I mean by that legislative changes. Without any amendments to the legal framework, we will be unable to do the reorganization and revamping as described in the documents signed with Pekao SA. We are awaiting further steps, but we do see risks that these regulatory changes will come into effect at a later date than the day defined in the term sheet. And we work together with the Pekao SA on how to react and to see if we are going to sign a new memorandum or not. And I think that we will know that in December, once we've known the exact deadlines. But we do stay in close contact with all stakeholders. So that will be for our Copenhagen project. We do follow up the development on the market. And in the media coverage -- what happens in the media coverage, the Minister of State Assets announced that securing state interest in this project is a key priority for him. Within the group, we are preparing the deployment of a new organizational model, the design works are underway, and we stay in close contact with the supervision authority to know if we will have the endorsement, but we do realize that the challenge is huge.

When I joined PZU Group, my first -- one of my first task was to stabilize the situation within the organization. We have 2 collective bargainings and we managed -- we had collective bargainings and we managed to close 2 -- to settle 2 disputes, and we are now in a dialogue with social partners. I do hope that by the end of the year, we will be able to find settlements in other disputes. We focus on a transparent and open communication with social partners in these collective bargainings. And I do hope we will be successful. We are preparing for the cultural transition. We want to transform our governance and culture. We want to be more agile, and we want to shift from silo thinking to a tribal thinking. It's a huge challenge ahead. But within the group, together with the other leadership team members, we believe that we are on the right track.

For technology. Well, in our previous meeting, we already said that we had a serious technology that within the group. The Management Board and especially [indiscernible] has been working in that. We've designed a plan to replace the key IT systems and we want to have low-code platforms to -- because we want to act swiftly and in an agile way or respond to any market developments. I've already said that we will have some new claims handling processes. We estimate that by the end of the first semester of 2026, we will already have all the analysis at hand and the provider will be selected and that we will be able to trigger the deployment. We've been implementing our corporate social responsibility policy. We want to build a society resilient to ongoing and current challenges. I'm sure you know our campaign champion slowed down. That's a road safety campaign. I'm sure you know the visualization and look at me moustache only in November because we have another health awareness raising campaign. I wear moustache this month because that's how I see my role as a leader -- as the CEO of the leader of the market leader. Its high profitability and yield, but it's also a major key player and a participant of the social life. Just don't forget we have people to live for talk to your family members about health, about prevention, about screening just go do screening tests. And my colleague does not wear moustache. I encourage him to do the same.

That will be the overview of our achievement -- efforts behind these achievements and plans for the future, my personal ambitions as the CEO -- acting CEO for now of the PZU.

And now I will move to Tomasz, who will give some more detailed brief of our business in the third quarter 2025.

Thank you very much. I try to be brief to get some time for the sum up by segment and to have a question-and-answer session. Let me start with some important factors impacting our results. We will start with non-life insurance. It was flat. However, over the same period we had some major rises on revenues from insurance services. There is a stratification among corporate clients, a drop of 9%, but the revenue grew by 7%. Why? Well, it's long-term business. The long-term business is still in our portfolio. We do provide our services, and that's an element of our exposure, and there is a different format used for the reporting to the supervisory authority. Our competitors would report that as a recent premium, especially that there was no change in coverage over the period, and we could not reprice that part of business.

This is an element of our exposure, as I've said. And we had some major rises in corporate and mass segments. Under the previous standard, we had the different measurement premium and that value reflects better what happens on the revenue side.

Now motor insurance, continued drop, especially Link4 portfolio mass insurances, a multi-agency nonprofitable channel, there has been a reduction. The channel was not among the top profitable entities last year in 2025 for the whole group and for Link4.

In 2025, we focus mainly on profitability and yield where such yield is achievable. And we skip any formats that historically are no longer attractive to us. There has been a slight adjustment, therefore, but just have a look the difference between written premium and revenue on insurance, which are -- the difference is the source of this adjustment. Here, in this segment, you have -- we have 3% -- growth of 3%. That's for health, either [indiscernible] of the existing portfolio or new contracts, new protection, insurances. This is a result of consistent work on the portfolio, and we added some new products, which help us improve our insurance margin. We had an 8% increase in individual health insurances. It was quite high, especially that the last year, the starting point was also quite solid. And we had a major share of investment products, including life and endowment insurance products. Quasi investment products sold through different channels, including through banks. And despite that, we still have a rise of 8% for individual health insurances and regular protection insurance products registered a 20% dynamics.

For the segment of Non-life Insurance, we've opened stand-alone products in bancassurance, Alior Bank and education. We've already launched what was announced upon the publication of our strategy. We started to go beyond Poland in active reassurance format. We want to be present in foreign markets outside Poland. We are in the stage of studying these markets, together with our reassurance partners and because the balance sheet is good, we have enough space to take on some more risk. And we want to limit anti-selection at the very start of that journey. So we had a fresh start, that is a strong team. And I do hope that in the incoming quarters, we will be able to give you some more details on revenues in this specific channel. We still focus on building and expanding skills in underwriting and bancassurance. We wanted to improve analytical skills of our teams.

Let us move to Life Insurance. We have some additional products, serious diseases, treatment abroad. These are elements that are now covered. We are an aging society, and we have ailment typical of much mature and aging societies. So health insurance is a topic of focus for us. We have an attractive offer with very, very hard premiums, and this offer really resonates among customers, attract a lot of customers. In group insurance, we offer a new product based on the insurance sum and the insurance sum is calculated based on the remuneration level. This is a pilot project. We've been testing that solution, and we have also products in bancassurance.

Health area, the CEO has already given you the details. We have had growth in both subscriptions and insurances, 15% year-to-year. And the same applies to medical facilities, whether it's occupational medicine or fee-for-service model, we have to digit it's more than 12% always. We are growing, thanks to our partners. We have partnered medical facilities. We want to be present everywhere and to attract more and more customers. We act as an adviser. We can suggest our own facilities or partner facilities simply to streamline the cost -- the average cost of medical procedures. We also increased the number of online visits, and there is a channeling of patients inflows to our medical facilities, 40% of all patients in the third quarter.

Assets under management, whether it's the TFI PZU or our group banks, we have TFI PZU as a leader PLN 3.5 billion, a large share in banks and growing scales of assets in ECS.

And now for product. A new fund, private debt fund which is done together with the Bank Pekao SA with joint allocation, both for us, for the bank. It's over PLN 100 million. It's a fund to finance companies as a long corporate debt with the offer is directed at the clients of private banking of Pekao SA and it looks like a good top-up of our offer in terms of the attractiveness of the investment, especially with this type of assets in mind. Now Innovate Poland, which recently was inaugurated by the CEO. So over to the CEO.

Innovate Poland, this is the Poland version of the program and PZU is one of the originators of the project. We are the private company, the joint projects together for the Polish Development Bank and the Polish expansion fund, which are public entities. We have done this to diversify our portfolio and to get extraordinary rates of return. This is also aligned with our strategy, because we've been diversifying our revenue on deposits. Thirdly, we see it as a project where there is a room for synergy with other projects that we have now in the pipeline. We collaborate with the highest number of start-ups in Poland. We have the PZU Ready project, which is for start-ups. So we can see some synergies here and the possibility to fund some of our partners with money from this Innovate Poland fund. Also additionally, thanks to the ideas of the project and some accreditation procedures and certification procedures, we think that this will let us to achieve synergy and speed up the certification and speed up the selection of funds we would like to invest in the future. Thank you.

Now our collaboration with banks -- bancassurance. Here, the sale measured through written premium quarterly reached PLN 600 million. So it's a very important distribution channel. It's growing, thanks to the same groups of products and the growing offer. And this time, stand-alone products have been added to our offer. So we hope that this channel will only continue to grow.

And now I would like to walk you through the financial results in Q3 with a breakdown into segments. So first, general results. The highest top line ever in Q3 and the highest result ever for the group. So top line now the growth year-to-year is around 5% with an important contribution of the non-life mass insurance, especially non-motor because here, the growth rate is almost 10%, 8.1% growth, corporate and non-life insurance. Group individually continued insurance are a bit lower, but the baseline was very high, and we will tell you what has happened here in this segment, double digit, 18% of growth in individual protection insurance and life insurance, a very high contribution from our foreign companies. So this actually generated our insurance revenue in this quarter.

Now net insurance revenue is the same as the gross amount that the year-to-year, a lot has been happening on the side of the costs, especially if you think about the claims and benefits. Here, you can break it down into 3 areas. So first, no comparability because let me remind you that last year, we were speaking from the point of view of the operations, and we were facing the flood and its consequences on the very next day after the flood and we were already there. So Q3 last year and the reported results was affected by this -- by this mass incident and actually brought the result down by PLN 265 million -- rather PLN 275 million. At the same time, the frequency of claims was lower in motor insurance, which also had an effect on the rate of return and MOD and MTPL in both segments, which is good news. At the same time, the reserves from previous years were overrated mainly because of the reversal of the trends of indexation. And I'm speaking here about PLN 56 million, the overestimate. There was also a drop in the reserve of the [indiscernible] provision.

Cost effectiveness is very important for us. This concerns how to reach customers in an effective way, also how much we want to spend on customer service. In both terms, we have increased our effectiveness. So we have increased the effectiveness of our administrative costs, personnel costs and technological cost is offset by other cost categories. So this means an improvement which translates into index which is lower by 30 basis points. The same goes for the cost of acquisition. And also now let me mention something that actually proves the quality of our business, the net contribution and the improvement of the loss component. As you can see, the new loss component and the amortization.

Overall, has a positive effect on the result. In all the segments, it's worth over PLN 90 million. So it's very good news especially if you think about what's happening in the Non-life and the Motor Insurance segment. Q3 ends at the level of [ 505 ], a huge change, 170% here year-to-year with strong growth and financial income, PLN 360 million with a growth of 45% year-to-year. This is the final result. And this mostly generated by the increase in the corporate debt and the improvement of the profitability of corporate capital instruments. So the final results for nonbanking amounts to PLN 1.419 billion. The banker segment is flat, 2.2% is a slight adjustment. This is -- this means that the result is PLN 1.9 billion and with very high profitability of equity over 25%. And this is much higher than expected when we published our strategy at the end of last year. Now we have improved cost effectiveness both on the side of life and non-life. And again, this is good news because this has had an effect on the result. And now let's have a look at the segments.

So first, let's start with the mass segment. The dynamic in non-motor insurance was a bit different because the growth rate was almost 10% and mostly household insurance, but also PZU [indiscernible] PZU company and offer for SMEs. This is a new approach to the insurance sum with a aggressive pricing. So this led to an important increase compared to Q3 last year. Motor insurance is quite flat, especially if you think about all the things happened with Link4. As we have already mentioned, Link4 needs to focus on bringing back profitability this year, but a slight increase in the acquisition costs.

Now quality has improved. Speaking about the expenses and the cost structure in this segment has changed totally. The share of cost in revenue has gone down, but there is also a lower liability for current claims. So there are some massive claims payouts, but also -- that were the last year, not this year, but also there has been an improvement in motor insurance. As I've told you in Q3, we had an improvement in the loss ratio -- loss frequency concerning this product. So a smaller loss component and the amortization of the loss component from last year gave us overall PLN 40 million, which contributed to the result of the SKU and with a positive effect of the overvaluation, overstatement of the reserves from last year. So PLN 715 million. This is the overall result in this segment with the effectiveness ratios improved practically in every area.

Now the motor market and how the trends are going to translate into the results in the upcoming quarters. So first of all, the price dynamics in MOD and MTPL. MOD now, it achieved the highest values in December, January and Q1 this year. The growth rate was at the level of 7.6%, with a drop to the level of 1.5 percent point. But still, it's a positive unlike MOD, which is minus 3%, the previous was MTPL. So for MOD, maybe the only positive thing is that maybe we have already hit the bottom and then we'll pick up. But in MOD, well, it still continues to be quite a profitable product at the end of Q2, which is the last publicly available data, it has a 7% of -- almost 7% of profitability.

And MTPL now. In Q1, this profitability was quite high and quite surprising. Now we are at the level of 0 given that the price is not growing anymore at the same rate. For MOD, there is no effect of the increase of the value of the cars. This was a phenomenon that was there after the pandemic for some time, but this was the main driver of growth that now has disappeared.

This slide is based on the PAS data. So cannot be directly referred to our reporting. Corporate Insurance segment, high dynamics, more than 8%, both for non-motor insurance, it's almost 7% and motor insurance Link4. Well, it's similar to mass segment, the acquisition costs are lower. The costs of acquisition are similar to mass segment structure of expenses has changed more or less 4% drop due to better cost efficiency, and that's an important parameter for the results of this third quarter, much more than the improvement in quality. We just look at net loss. The net loss also had a positive impact on corporate clients. Current liabilities have gone down. We had lower payments and lower liabilities in non-motor insurances. As you see a bunch of factors that help us to get a double growth up to PLN 309 million. It's similar to mass segments. We've seen the improvement in all major product group. Group individual continued insurance. We started with a high base and then we had increases. However, what I would like to stress is a lower allocated premium for future expected claims and benefits. We had a drop of 64% in this loss component. We've had a better alignment and a more conservative approach. We just thought that the loss ratio and mortality could be higher, but not -- it did not happen. We had very positive variations on these components last year. Because we had better alignment for 2025, we've managed to get a better share of CSM. And with that, we got 26% increase year-to-year. It's not only a standard scale up. We've also changed cost and actuarial assumptions regarding insurance liabilities. That is why we have a 1.5% increase in insurance revenues. We had lower payments under individual continued health insurance, and there was a slight increase -- general slight increase in health insurances with positive cost components. And we end Q3 in operating result of PLN 550 million and a profitability of 27%.

Mortality. In the 3Q -- well, 3Q is usually a period of seasonally moderate number of deaths and that was the case this year with a slight improvement year-to-year compared to 3Q 2024, we had an improvement of 3.3%. So the number of compensation benefits to death ratio, it remains positive for us compared to the similar period. So it's better by 10%, around 10%.

Individual protection insurance. In this segment, you see very high increases 18.1%. We've already mentioned that. It's basically due to 2 products, individual insurance, which profits and individual protection insurance, PLN 17 million and PLN 14 million increases, respectively, for both of them over that period and CSM has grown considerably 21% year-to-year. And this was a result of better cost effectiveness. Because of that, we decided to change the assumptions regarding costs and the share of costs in contracted insurances. These increases come mainly as a result of scale-up of our businesses, and this translates into better operating results, 10% compared to the previous year. So this quarter is closed with PLN 120 million contribution of that segment to the consolidated results.

Let me now move to the CSM balance sheet value. It will be recognized in consolidated results. As you can see, we've had some major increases for CSM from existing businesses and new businesses. For existing businesses, we've had some positive impact of rate indexation, rate tarification and there was also a change in assumptions, and that influenced our way of thinking our approach to costs of that service in the future. Let me mention 2 points regarding that change. The change is usually introduced in quarter 4. This year, we've introduced the change in quarter 3 because there has been some earlier dates set for reporting. So we want to be ready for February because we want to change, be more proactive in communication with the market, and we want to report faster. But sometimes, we were unable to get involved in some communication because we had a delayed reporting. That is why some procedures were implemented earlier and among them were the procedure on the update of technical assumptions and for CSM, we got a very positive effect because we got better cost efficiency in the end. As you can see in both segments, there has been a major improvement. Investment results 5.7% in interest. We also see an increase and the same can be said about debt instruments, the same parameter was different a year before. Last year, we wanted to seize the opportunity on the market, and we wanted to extend the portfolio. There was some negative valuation of these instruments. Also last year, we had depreciation write-off on 1 corporate exposure item. And that's why you've seen a major increase year-to-year, there has been an increase for capital instruments, indexing, private equity and health sector, all of them contributed to this class of deposits. We note a positive contribution to investment real estate assets with a level of 5.7% at the end.

And I will end with solvency. It's extremely secure. Results are very high, and we can adopt an extremely optimistic outlook for the year to come. As you see and as you hear, third quarter is the time of growth of our own funds with a slight increase in Solvency II requirement. The increase was observed for both insurance business and for banking -- Bancassurance segment. What's our trajectory and what's the state of play.

Gross insurance revenue. Here, we need to look for and prospect new sources inward reassurance. And definitely, as the CEO has said, we need to step up our efforts to get our ambitious goal and to deliver what we've defined by the end of 2027. Value-based thinking pays off. And just have a look at our ROE. We are within the range of our strategic goals for both life and non-life insurance, profitability. We have high Solvency II ratio, and we didn't have reorganization. We just have changes as part of the Solvency II regulation. We've known the details for some time. And now we can say that depending on different scenarios, we are quite well prepared. We are a value-based company and that is why we are selected by investors who believe that we will be able to provide high value and high return on dividends so the dividend per share will be really high. So as I've said, we are really prepared for that. That would be the sum up of the results for quarter 3 and our trajectory in the state of play.

And now I give the floor to our CEO, and please feel free to ask any questions.

It was very solid, good positive 10 months. That would be my final word.

Yes, I have to speak to the mic. We had very good 10 months. And now I open the question-answer session. I look at the chat, but let us start with people who are physically in the room. Any questions from the audience in the room. So let us start with questions on non-life insurance.

Autonomous Research. I will translate that into Polish. To what extent was the combined ratio in Poland in 3Q by favorable weather conditions and/or reserve releases in the third quarter.

Let me phrase it that way. I would like to stress firmly the following thing. Our DNA includes a conservative approach to liabilities, including insurance liabilities. So we will not act unpredictably here. We have reserves. The level of reserves is absolutely adequate to the market situation -- persisting market situation. These reserves are also adequate because they will allow us to cover all insurance liabilities whatever the scenario. So our insurance portfolio is like this. And the economy has an effect on it as well, and this is what has happened in Q3. So the first thing that happened was the following. And this was purely economical. The inflation got down. And this is about modeling results for the capitalized value. And together with the drop in the inflation rate. So there is also a huge correlation between the indexation level decided by the courts and also the trends of the inflation, the CPI or the salaries inflation. So we see some room for a drop in the level of reserves. And at the same time, we will remain as conservative as before because in the upcoming years, probably we won't have double-digit figures as in the previous years. And this is because the inflation rate is on a very good trajectory to reach the inflation rate goals, as mentioned by the Polish National Bank. So PLN 50 million for MTPL. This was 1 of the reserves I'm referring to.

The second parameter is the following. Let me remind you -- but years ago, given the case law, whenever there were injured people in a car accident that actually survived but they were in persistent vegetative state, the family had to look after a person -- bedridden people or seriously ill. So we are speaking here about their mental psychological consequences, which led to claims and in 2017, 2018, we created a reserve for that purpose. But we can see that there are fewer and fewer claims, where courts decides the money to be paid. And this was for years, 1998, 2017, so 20 years of liability. And now we are gradually decreasing that reserve, and this also has had an effect to the overestimate of PLN 21 million on the results. So this is what it looks like in the non-life insurance segment and I hope this addresses your question.

The second question is from HSBC. How does business mix shift from motor to non-motor impact your combined ratio over the next few years? Can this shift to higher-margin non-motor offset pressure from softer market conditions?

So we made it very clear in our strategy. What we really are focused on is the growth of profitability that's in our DNA. That's why it was our conscious decision to limit situations, which are not very attractive in terms of value generation. We have told you about the Link4 portfolio situation. We also repositioned PZU SA and the effect of which has been and probably will be the increase in the share of the non-motor segment line of business. What we think is still relevant is that the mass and corporate segment with the mixed portfolio, which brings together motor and non-motor insurance. Here, we want to have profitability managed by combined ratio, but at the levels of no more than 90%. This is our target. Hence, the new activities whose purpose is also to make more room for more revenues in a situation of a soft market.

And now speaking about motor insurance, given the pricing pressures in motor insurance, what levels do you have to sustain your core in the upcoming period?

Well, I think it depends on how the market behaves. Because the claim inflation rate has been going down. So when you think about the average price of compensation and motor insurance, we can't be too optimistic about the levels of this and the fact that they will start at the same level. So frequency might have an effect, and this is precisely what happened in Q3, but the inflation trends will also have an effect. What we see is the following situation. The MOD market remains to be profitable -- remains profitable, and we are a bit more profitable here. But please bear in mind that we are using a different standard and the one that allows us to gather market data. So if the situation continues, probably this will lead to a compression of margins and whether it's 5% because this is very, very stable and the profitability is going down very slowly but steadily. Anyway, it's very difficult to predict. Now we have negative data from 2 quarters. Q2 and Q3, the negative adjustment is minus 2.8%, and we'll see how it continues at the end of the year, because the end of the year is a very interesting time because some are already positioning themselves for the next year, some are still trying to deliver targets from the current year. So it's interesting things to happen. So if we are able to grab this opportunity and position ourselves the right way, we might even benefit from this situation in Q4.

And now MTPL. We don't want to grow at any cost in channels where there is no value for us. So maybe as discussed in our strategy, we will continue to grow but slower, but we will be able to generate value for our shareholders or for our customers because we have a very big portfolio and also, I think that we have mentioned pricing and other issues and we're getting better at the offering to our customers. So if nothing happens, we think there will be a slight depreciation of the margin on MTPL, but we still think it's going to be a profitable product but also depends on the market and the situation.

Today, the market is not profitable. And there are companies that generate value and there are some that loss value. And we want to be among the former, but it means that it's very hard work, and it's very nuanced in terms of accepting risking and portfolio and tariff settings in the mass insurance are part of PZU's activity and the part of our priorities. Of course, there is the market situation, but also we have a list of activities that help us improve like pricing, claim handling, frauds. So we have to analyze thoroughly what's going on in the market, but there are also things happening inside PZU.

And there is also 1 more question from [ Trigun ] about the Motor Insurance segment. So what's behind this very significant improvement in the profitability quarter-to-quarter.

And we have answered this question already. Well, there is 1 more element that also happened in Q2, the amortization versus the new creation of loss component, the amortization is higher and has a positive contribution to the result.

There is 1 more question, a new one from HSBC. Historically, so -- is this the moment in the market where the pressure allows it to reverse? I mean, become more profitable? So historically speaking, where are we. So is it subsidizing 1 product with another?

I think that the Polish market changed significantly when the pandemic started. Let me remind you. In 2019, we told you that a new underwriting cycle was beginning, but the pandemic was a game changer. And first, we had gigantic profits. This was largely because there was no traffic and no insurance incidents. But then people started to work half remotely and half in the office in a hybrid way the traffic came back to the street. And you could see that this cycle was very much disrupted by the pandemic, and the cycle took overall 6 -- almost 7 years. So it's difficult to find a similar period in the past. So historically speaking, in a totally different legislative environment, there was a point where both MOD and MTPL products were not profitable, and this was when the regulator, the financial authority started its interventions. And that was 2017 as far as I remember when the new regulations on the price adequacy took effect. The purpose was to curb the situation that had been happening back then. So now it's difficult to imagine a situation or a huge technical losses offset. And everyone is happy. Why? Usually such a model has a very negative effect on the capital position and insurance companies need to guarantee the right capital to cover and to pay insurance liabilities. So the rules have changed a bit here. So after such a long cycle, it's difficult to compare this time to a similar moment in 2015 or '17. And this approach could be also seen in our strategy, but it looks like we are going to move in a much narrower corridor historically speaking, maybe with a pricing cycle or an underwriting cycle. But it's time span is going to be totally different unprecedented. Let me stress one thing. We are far from a negative technical result, far from it. That's not our philosophy.

We have 2 more questions regarding results and communication, 1 from HSBC and [ Trigun ]. Regarding non-motor insurances, do you see any one-offs. That will be from [ Trigun ]. And from HSBC, weather losses were having in 2024, but would you describe 2025 as a normal year? If not, how much should we normalize for weather?

Well, let me phrase it this way. Depends what you understand by normal. The flood, we experienced last year. It's not a regular event. And it's recurring event that should be included in the forecast for every year. I believe that technically speaking in non-motor insurance, it's quite okay. We had some frost in the second quarter for PLN 10 million. Apart from that, there were now other massive events, the ones we had last year, like flooding. So again, what is normal? What does it mean normal? We had more violent weather incidents that's for sure and we have some unseen events. For instance, a heavy rainfall during winter. And we believe that these events may have impact on the claims side. But this is a quotation element. The parameters, which influenced the level of risks are also taken into account when the quotation is being produced. Right now, we've changed our way of thinking. We know that we may have clients on -- in the flooding areas. We have flood protection, not far from the Vistula River in Warsaw, and we have big villas. And when we produce quotation for insurance for such large villas, we will do a totally different valuation than the valuation for a small 3-room flat, somewhere in the tenement building. So these elements unprecedented weather events are already piece and parcel of our quotation methodology. So again, normal for us here means positive. This year is positive.

I still have 1 question about investment -- about holding. So about investments. It's from Autonomous Research. You've mentioned pressure on investment income in insurance and the contribution from banks, given the duration and maturity profile of your fixed income portfolio, what pace of compression should we expect on the fixed income yield in banking? Can lending growth potentially offset pressure on net interest margins?

Let me answer the following way -- give you the following answer. I will take the perspective of the last 12 months because we started efforts in this area in the third quarter of 2024. What happened there then was that we simply wanted to use what happened around us. So in order to extend and in some way freeze our debt portfolio, mainly sovereign bonds portfolio. We simply seized the opportunity of very positive environment and positive external parameters. And there were some positive results last year. We managed that. And we believe that we can benefit from this on -- in the long term. If interest rates go down by 100 -- 100 basis points, we will be between PLN 80 million and PLN 110 million, PLN 120 million corridor. That would be our position right now. We will do our best to offset that corridor, and we can afford that today, considering our capital position right now. So we can increase that level -- slightly increase that level of acceptable risk. And the share of debt -- corporate debt instruments in our investment portfolio. This share is not excessively big. And the CEO said today that the sovereign debt treasury -- debt share in our portfolio corresponds to 65%. So it's 65% of the whole debt portfolio, and we are not representative Europe-wise when compared to other European peers. So we still have some room, but it needs to be meaningful if you have no reasons to rely on out-of-the-box solutions, you won't use out-of-the-box solutions. However, the number of possibilities is limited. This is not a very deep market. The Polish market is not very deep. And we do have some strategies which try to go beyond the Polish market as sort of a change of cap, and we will think about it if there are new drops of interest rates. And this will be aligned with the new organization and with the new -- with our strategy.

And we have the last question about holding. Could you remind us of the time line to complete the merger with Bank Pekao or reorganization? And could you provide an update on the legislative process that will enable the merger -- the reorganization?

Well, you should have been closed by the end of the second quarter, it should be closed by the end of the second quarter 2026 according to the time sheet. Legislative process. The draft will be sent to the parliament. We are just ahead of the parliamentary work. And it's too early to answer the question on the shares and the price of shares.

And brokerage house of Citi Handlowy Bank. I have a very specific question, but I know that the CEO has such a background. I have a question about the presence -- your presence in the Baltic states. There have been some details in the presentation, but what is the cycle? What's the stage of the cycle? And what are the risks? What are the threats?

Well, the market is similar to the Polish market. There are less insurance companies, but the competition is similar. There is a different mix, slightly different mix split by industries. Traditionally, transportation, logistics, furniture and wood industries. These are the traditional industries within the mix. As you probably know, we are facing a major challenge in Lithuania, there has been a 10% tax on revenues from insurance that has been just introduced, 10% of the written premium tax. And we -- just want to know how this tax on the 10% of the written premium will be calculated. We know that the proceeds from the tax will be used to finance the defense spending. And I believe that this may have an impact on the insurance market in Lithuania. There are no implementing acts and some business lines will be exempted. This is the situation in the Lithuanian market. As you probably know, a long time ago, as part of the transaction with RSA acquired Lithuanian Latvian PZU and the branch of [indiscernible] in Estonia. Right now, [indiscernible] is faring extremely well. They are agile. They are the market leader and they represent the sales mix as we do. They have their own network of insurance agents and they also have cooperation with external channels, a strong position of brokers within the network, similar to multi-agencies in Poland, similar price leverages. The mass segment is most developed for medics. For us, it's health insurance, and it's in Lithuania, the same sector is now on the rise in Lithuania and Latvia, the most developed and Lithuania developing. In both cases, we have good profitability. And the reasons for that are similar to the causes in Poland, the difficulties in accessing public health care. In Estonia, the situation is slightly different, public health care services are of high quality, and that's why health insurance is not a widespread product. And there is a high level of digitization, plus need for quick response. So when you get the request for quotation need to react immediately. We are market leader in non-life in Lithuania. We are market leader as a stand-alone company without consolidation, so as a stand-alone company. And we are also a leader in Latvia. And in Estonia, we are #3. As far as I know, for non-life. Our life insurance company in Lithuania has started to show a positive dynamic. So there has been some growth. But undoubtedly, we need to speed up and we are right now thinking how to reposition the company on the market. The Lithuanian company has a branch in Estonia [indiscernible] has a branch in Estonia. Many years ago, we bought a branch actually and Volta is a standalone company headquartered in Riga, combined ratio and written premiums. I don't know if we have data on that. Let me show you the exact slide. And if you add to Ukrainian companies, PLN 2.3 billion of written premium for third quarter alone. So the Baltic countries plus Ukraine. It's integrated, consolidated in 2025. 86.5% of combined ratio, Baltic States and Ukraine and then the conversion of local currencies. I have to check for written premiums. We actually, you got me, you got me with your question. I have to check and get back to you with the details. However, the combined ratio is at 86.5%, and it's similar to PZU's combined ratio, and the product mix is also close to what we have here.

Distribution channels. When we bought Estonian branch Bancassurance and City Bank had a major share. Now this share has shrinken and there is a bigger share of broker and agent sales -- broker and agent-mediated sales. So bancassurance still counts, but its share is not that important.

Many years ago, I was involved in the acquisition of this business and I can tell you and Tomasz will agree with me probably that all the basic assumptions were delivered with a surplus. So all the companies are agile, and they have a very successful contribution.

And now Ukraine. We are now undergoing a very, very deep restructuring of the companies and this year, Q3 has witnessed a strong pickup in terms of sales and the combined ratio is at the level of 94. So there is no reason to be ashamed given the extreme conditions over the circumstances. So we can be actually proud of it.

Any more questions? No more questions online.

So thank you very much for your attention, and we hope we see you -- we'll see you again in -- after Q4 and we will be informed about the date of the conference in the current report.

Thank you very much. It has been very stressful, but also a very interesting experience. And please have a look at our website and our awareness campaigns. Thank you.

Ladies and gentlemen, it is my pleasure to welcome you at today's conference. Today, we'll discuss the financial results of the PZU capital group during the first half of 2025. We'll focus in particular on the second quarter of 2025. Together with me, there is Tomasz Kulik and Jan Zimowicz, member of the Board.

And I'll hand over to Mr. Kulik. Mr. Kulik?

Ladies and gentlemen, it is my pleasure to welcome you at this conference. We will present to you our financial results for the first 6 months of 2025 with a particular focus on the second quarter of 2025. We will start by presenting our main achievements, then we will brief you on our standing on the market. And at that point, we will move away from IFRS, and we will use local ratios because these are the ratios that our competition is using when they present their results. Then we will present to you our strategy for the years 2025, 2027, which is going to be followed by a Q&A session.

Given the agenda, and given the fact that we are joined by Mr. Zimowicz, who is the Head of PZU Health, I suggest to discuss very quickly the general information. So in this way, we'll have more time to discuss other matters that we believe are important for our company's future and which will be the main driver of growth.

So without further ado, I would like to tell you that we have been growing year-on-year, both when we compare the last half year and the last quarter. We have generated an almost additional PLN 1 billion in revenue year-on-year. The profitability is high. We use adjusted ROE to measure it and adjusted ROE is at above 20%.

The total profitability is at PLN 3.2 billion. We have a very strong capital position, and we will offer very high dividend in this quarter. So those of you who decided to trust our strategy or those who have invested in our shares for quite a long time, will be quite pleased with the dividend yield.

How did we generate our dynamic growth? We have -- we can report a large increase in insurance, 50% year-on-year. In our banking portfolio, the growth was slightly lower. If we take into account the results from our services and profitability and the result on investment portfolio, the K margin and the combined ratio, I can say that we had quite a substantial improvement in all of these 4 areas. The insurance service result is higher than last year. The result on investment portfolio is also quite substantial. We also have a very strong operating margin, in particular, in life insurance. And combined ratio is below 90%. So this means that we are still hitting our strategic objective.

Regarding our -- the scale of our activity. In this slide, you can see the areas of our activity that have contributed most to the scale up. As usual, we have non-motor insurance revenue. The increase year-on-year is at over 11%.

Next, individual protection insurance revenue. The increase year-on-year is above 12%. The health pillar revenue, that we are about to discuss in detail, is also doing quite well. The same goes for the assets of external clients under our management.

TFI PZU is still #1 among nonbank TFIs and we have reported nearly PLN 2 billion increase. We also have a high rating and a very secure investment portfolio. We also have reinsurance protection. This is what helps us to build our capital position. And at the end of Q2, the Solvency II ratio for our group was at 225%.

We are not operating on an easy or straightforward market. We're actually being tested constantly by the market. I would like to share with you our take on a very mediatized event, namely the fire in Zabki. Like last year, this year, we tried to build trust with our clients by showing them that our group is present on site one day after a calamity occurs and that the claims are settled as quickly as possible.

Second quarter of 2025 was full of fires and damage that those fires that were quite mediatized caused. We also had quite a lot of damage caused by weather events. In Poland, usually, in May and June, we report high level of rainfall. This year, in particular, the weather was not very summer like, if I can put it this way. As a result, we had to pay out a lot of claims in the second quarter of 2025.

Let me now briefly present to you our -- the situation in individual segments. Now I will use the Polish reference terms. So we won't be using accounting terms but I will give you data regarding gross written premium.

The dynamics in the growth of the gross written premium has been flat. The main reason for that is the situation in the corporate segment. In 2024 -- in Q2 2024, our group was a beneficiary of the general situation. So if we convert the gross written premium into revenue from insurance services, then we'll see that the second ratio is better to describe our exposure and how it changed in time because regardless of the payment due date and regardless of the sales date and when the insurance policy is recognized in our portfolio -- so regardless of them, there are still some changes in the gross written premium.

But regarding -- so the way that new policies affect our exposure and the way that insurance service is used -- well, regarding mass insurance in the non-motor sector, we have a good growth, 8.4% year-on-year. So again, it is important always to take the general context into account and this will allow to draw the right conclusions from the data.

We also have some drops in motor insurance. This is due to the fact that clients migrate to Link4. This was quite a headache for us. Also the multiagency channel contributed to this negative trend. We are finding ways to deal with it. However, the measures we have taken are reflected in our top line. This means that the portfolio that was created as a result that was not always optimistic or that was not always giving us a good perspective for the future. As a result, we'll need to focus more on rentability in motor insurance.

Moving on to life insurance. The life insurance portfolio in Q2 was operating at 2 speeds. Group insurance and individual continued insurance operated at its own speed. Here, we are dealing with repricing, especially in health insurance. We have also introduced some changes to our tariffs and attracted new customers. While in other areas, working closely with our clients were the factors that generated dynamics year-on-year.

In individual insurance, we have reported quite a substantial growth, 36%, and this was generated by one-off investment products. The market situation is helping because the general mood on the market is good. And this incentivizes our clients to buy those products, be it life and endowment insurance or semi-deposit products. So we are able to generate value for our customers, and they respond to it enthusiastically. And this explains this massive growth.

We also welcome the fact that there is an increase in other products, the increases of 21% and those products close to protection and life insurance are less dependent on the market situation, and they help us to build a good relationship with our clients.

Now we have 2 new products in our portfolio. One of them is PZU house, the other one is PZU for cyclists. They offer a broad scope of services and a good price. So if there is among you someone who would like to buy an insurance dedicated to cyclists, then our offer is perfect for you. So we highly encourage you to familiarize yourselves with this product.

Now I will hand over to Mr. Zimowicz.

My name is Jan Zimowicz. I'm the President of PZU Zdrowie. If I were to summarize our business, there has been more business plus 14%. So we managed to generate growth with stable costs. The revenue on the top line was growing. Our EBITDA has improved from 4% to 11%. So 2.5% more of profitability coming from our subscription business in the health care pillar. So this is already visible when it comes to our contribution to the top line.

How is it possible? We still have some reserves in our organization when it comes to cost effectiveness ratio, when it comes to profitability. The number of visits that are actually pointed through our online app. Here, we have still here room for improvement. And then we have the possibility to service our patients at our own facilities. This gives us a higher profitability and lower own costs in our medical pillar.

And these are the 2 things we have been concentrating on. So on the one hand, the increase of profit, the increase of revenue, we would like to cover all the white spots on the map of Poland. For example, in Poznan, we will be definitely opening more health care facilities, more clinics and we would like to go back to customer acquisition. We will be changing the funding of PZU Zdrowie in a way that the company can invest more in growth. So that's definitely an investment for the future.

We believe that the health care pillar, the private market for health care services will grow by 50% to PLN 50 billion. We'll be using our owner channels, agency channels, but we would like to step up our collaboration with banks and what we want to be really famous for is quality. We'd like to concentrate in our next product on VIP clients. We'd like to be servicing people in one day, for example, when it comes to occupational medicine services. But we also offer cross-selling, we offer travel insurance to people using our health care services.

I also deal with bank assurance. We are definitely the market leader when it comes to sales. But what's interesting, we have been growing more dynamically versus the market. And when it comes to life insurance, year-on-year over 18% of growth. And what is really helping us here is very good sales of investment and savings products. We offer them through our banks using VeloBank, Alior Bank. And at the VeloBank, we have over 8% year-on-year.

What we have been also developing is a very perspective future-oriented market that is not linked product. For example, at a bank, you'll be able to get your motor insurance. And here, we have had a twofold increase. If we have a look at the combined ratio for PZU SA, it's under 60% for COR, under 70%. We are going to invest in this area.

We are very ambitious when it comes to the cross-selling of non-linked products. We hope that by the half of 2026, we would like to have stand-alone products at PKO SA and at the other bank.

Closing this first section, a few words about assets under management, you have already heard about our dynamic growth when it comes to TFI, so I would like to supplement one thing we have very strong results when it comes to PPK, this is -- which is ECS, employee capital schemes. And this is the next area after our health pillar that should become a great area of growth and definitely an area of focus of our strategy.

New products. Here, I would like to mention a product that will have an exposure to gold price. We had a product that invested in mining -- gold mining companies. The first product should be launched in a matter of days. So if you have been looking for a similar offer in the market, feel invited to invest, but that's not the only new product that we are going to launch. If you are in for a bit more of risk, if you are interested in interesting products, on our website, you will very soon see a new offer. So if you have a more risk-oriented investment profile, that will be something for you.

And now coming back to the summary of results and back to international financial reporting standards, we are talking about consolidated results. So we do it the way the public listed companies are obliged to report. We have seen a 6% of growth, almost 6% when it comes to revenues from our [ recuration ] services, insurance revenue, as I've said, over 6%. We are growing when it comes to mass insurance, especially non-motor insurance with over 12% of growth.

And when it comes to our corporate clients, we have had a second quarter with a double-digit growth. And then when it comes to motor insurances, it's 12.6% and MTPL over 6%. It was quite flat when it comes to individual insurance, which is quite surprisingly good news, and a 2-digit increase in individual insurance. Our dynamic is really decent, especially given the situation in the Baltics and in Ukraine with 7% growth. When it comes to insurance services, here the trend has been different. The dynamics was higher, especially when compared to claims, 7.8%.

There were 2 types of events responsible for our payout. First of all, weather conditions, natural catastrophes, hail, floods, frost and so on. On the other hand, in the corporate world, we had a few bigger scale events, one-offs, but still they translated into decreased profitability in this area, which is nevertheless quite high.

Now let's talk about costs. There has been a slowdown of cost increase, which improves our profitability. We have spent less on administration and on customer acquisition. So we are down 30 basis points for each category. We'd like to emphasize one thing. The last quarter shows that the quality of our insurance services have been growing -- has been growing. It translates into this new component of a loss that we have been using. It describes the lack of adjustment of our premium. We really need to analyze it for the whole insurance premium. That's the difference between Polish standard and international standards. In Poland, the write-off, the amortization period takes 12 months. When it comes to our mass clients, we can see the positives of this different approach to amortization, especially when we compare it quarter-to-quarter, year-on-year.

To sum up, it is over PLN 900 million of increase. Our portfolio is performing really well when it comes to the coverage of insurance premiums. Year-on-year, we are at almost PLN 950 million, which means even better momentum for our net profit for the equity holders. This was excluding the banks. When it comes to the banks, we have had over plus 10%. The increase was due to high interest revenues and lower write-offs connected to more so called mortgage holidays. It's been over 23% of increase year-on-year.

What's really important, and I would like you to remember that is the return on equity. It is at almost 19% despite the difficult weather events. Good news is that we have improved this return of -- by almost 200 basis points, including the combined ratio and the margin was well above 25%.

And now let me move on to a quick wrap-up segment by segment. And let's start with the mass segment. Here, you have already heard about our revenue structure. And I have already discussed motor and non-motor insurances. You can see the results for MTPL and MOD, we've been growing.

When it comes to our portfolio, this is not something to be worried about. But this might give us some reasons for concern in the future and a double-digit growth in non-motor insurance. When it comes to cost, they have been growing, but not significantly. We are up 2.6% year-on-year. Despite what I've already mentioned, that is a high payout due to claim servicing, given extraordinary weather events and extraordinary losses at our customers.

Given that our portfolio has improved in quality and we can see plus PLN 55 million when it comes to the new component of loss which might be difficult to understand, but that's actually the term that I should be using. It translates into positive growing results within the motor segment. In non-motor, we have seen an improvement year-on-year. When it comes to motor insurance, we are slightly below our target. You can see the numbers in the pie chart, when it comes to third-party party liability, there has been an improvement of over 7.5%.

Let me now briefly discuss the situation on the market. This is important because it is going to translate into our results in the further quarters. And in terms of points of reference, we are -- I'm now going to use IFSR (sic) [ IFRS ]. When it comes to MTPL, we are below 0. So this is an adjustment. The trend is at minus 2.6%. And taking into account the trends from the previous quarter, from Q1, Q3 of the previous year, this is justified.

We also need to handle growing costs and expenses. Our company is growing. This means that our expenses grow mainly because of a growing number of people on the payroll. It will continue to grow, and this might put us in a difficult situation. We had similar challenges in 2024. In 2024, we had a serious drops in MTPL profitability from minus 2% to minus 4%. This year, initially, we had some good news about profitability in MTPL. Also, there was a small number relatively of claims. However, the price is going to be adjusted at the end of Q2, and there is a growing appetite to allocate growing profitability to generate dumping prices. So this market situation will be rather negative from our perspective and it will generate more difficulties.

Let us move on now to the corporate segment. We are glad to report another quarter with double-digit growth. In motor insurance, the main driver of growth was MTPL. Non-motor insurance accounted for 9.3% year-on-year, motor insurance for 12.5% year-on-year.

Expenses. The expenses went up by 23%, almost 24%. And this was caused by 2 factors. I have already highlighted one of them, namely a number of one-off events that generated a lot of claims. One of them was fire that generated PLN 60 million in expenses. So the growth of that insurance services expenses can be actually explained by this one-off event and another is a slight shift in the market situation compared to the same period last year.

These events affected us a lot, and we were trying to model our forecasts using expenses as the point of departure. So as a result, the report, the growth of expenses is at 23% year-on-year. That's a lot, and this does affect our result. But to a certain extent, we were ready for this.

I also need to underline that the base maybe was not representative enough. If we compare today's data with the data on the corporate insurance segment last year, and the combined ratio was at 58%. Then -- and if we assume that this combined -- this level of combined ratio can be repeated in the long run. So now we are back at the normal level of results, even though that in non-motor insurance, we are below our strategic objectives, still 84.4% and 84.8% generate -- I mean they stand for good profitability.

Now group and individually continued insurance. The result in insurance revenue is rather flat. There is a slight drop compared to last year. How to interpret this data? First of all, I would like to reassure you the situation is good. We sell insurance policies. Our clients are solvent, and we are on a good trajectory. Yet what is important to note is that there is a certain seasonality in the number of claims, in particularly the morbidity and mortality ratio.

You know that the situation is -- does change between Q4 and Q1. Also, summer holidays is a period where a number of claims is slightly lower. So we have adjusted our forecast to this seasonality. That's why we recognize a lower premium to cover the expected amount of losses and claims. And this generates the value for us and CSM to address losses in the future.

Our sales of insurance policies to grow. And the growth in absolute figures is at PLN 40 million year-on-year. The expenses do grow, however, but only at almost 2%. And this was caused by a lower loss component and a higher amount in claims and benefits. These are the 2 elements that are responsible for expenses, and you need to add to this, the acquisition expenses that are correlated with the cost of the portfolio. As a result, the operating result has been slightly adjusted while the margin is at 25.6%. So I would say that all right, we are falling, but we are falling in style and style matters.

Now I'd like to discuss the distribution of mortality. I think that looking at the data and charts, we can say that the COVID effect is over by now. Even though that currently, we are reporting a drop in the number of deaths, but this drop is similar to the one that we observed last year. So I think we can talk about the stable -- that we are in a stable situation currently. And also in our portfolio, we have reported a lower number of death benefits.

There is a change in our portfolio, and this is a change that is beneficial for us and it is not correlated with the decisions made by our customers because it's just a part of a general trend.

Life insurance, individual protection insurance. Let me highlight 2 things. This segment is nonhomogeneous. We had an increase in CSM at almost 20% year-on-year, and it is owed to 2 kinds of insurance. One is the individual protection insurance with profit participation and the second is individual protection insurance. These 2 account for the growth in this segment, both in absolute figures as -- and also as a part of CSM that was recognized in this area.

Insurance service expenses. The trend is quite standard as for this part of the segment, and it is created by introducing new solutions, new products and acquisition expenses with a stable level of benefits and claims. This results in growing operating results, both in absolute and relative terms. So we do generate value. And even though the volumes are smaller than in case of group insurance, it is still very well-performing and promising segment.

Now the margin. The margin is satisfactory in group and individually continued insurance. We have up-selling, cross-selling and these solutions systemically and systematically generate value. This is good news especially that this is the case with all product groups.

And then our investment portfolio, we are operating again at a number of speeds. The structure of the portfolio is still safe and secure. The debt instrument and the tax instrument are at the same level as in the previous quarter. The result is a product of a growing interest revenue and the valuation and good yield on capital instruments and equity instruments, in particular stock indexes and our exposure to private equity.

Unfortunately, we are suffering from a negative impact of our real estate portfolio, both in terms of valuation and additional costs of putting those facilities and the property on the market. We also have the foreign currency exchange ratio has negatively affected our real estate portfolio. And actually, this is a traditional thing already. Always in Q1 and Q3, we report some changes in the valuation depending on the exchange rate.

Solvency is high, 225% owner -- capital own equity has been on an increase. So we are definitely above the minimum standards. If we talk about market risk and natural event risk, I believe I would like to explain one thing why there are 2 different curves when it comes to the increase of the own funds versus the required share of capital.

We are changing our reinsurance program. We would like to benefit from a very profitable business. This means that we need to invest more in reinsurance in protection should there be some shocks in the market. And this is why our SCR has increased.

And now moving on to our strategy. I would like to say that it is in line and on target but our gross insurance revenue are still a challenge. This is something that we communicated to you upfront as a part of our strategy. We knew that this is going to be difficult. We are very happy because of a high profitability of the whole and of the insurance part.

You can see how it shows through our different segments, material life insurance and nonlife insurance. And here, I'd like to stop and give you time for your questions. So let us move on to your questions.

Let's start with the room. Are there any questions in the room?

Kamil Stolarski from Santander Bank. I've 2 general questions. Is PZU going to take its decision on Alior in September?

Is that your only question?

Okay. So dividend for 2025. I congratulate you on your profit per share. Is there any kind of scenario in which the dividend for 2025 will go to the shareholders? Or will it go to PKO SA? And as we have the representative of PZU Healthcare, PLN 3 billion or PLN 5 billion, what do you believe is going to be true for 2025, which is closer to your heart? I don't know the NPS but when I talk to the employees of PZU, they really complain about the quality of service when it comes to PZU Healthcare. They say it's not possible to register for a consult that is difficult to change, the data of a visit of your appointment. So you were talking about more acquisition, but isn't it time to do some housekeeping and to take care of quality of service when it comes to appointments canceling and so on?

Let me take the Alior question. When it comes to Alior Bank, this is not an isolated island, but an element of the whole group. Solutions must take into account its role and place in the group. And probably we'll have to wait for the tough -- for the final decisions to be taken. PZU has been evolving and introducing changes. So right now, we are not able to tell you more about the Alior situation. And coming back to the dividend question. This is a question about the future schedule of the process.

I do understand that the schedule should not be gossipped about. But the President of PKO SA has already spilled the beans. So let's say the door is open for me to share some information. It looks as if we are going to close the year with no significant changes. That is, we are going to close the year in which the parent company at PZU, the leading company as PZU SA, please bear in mind one thing. We have discussed it a few times. The whole process comprises of 2 steps. Step #1, creation of a holding company. This is what CEO Klesyk mentioned when he discussed the results of 2024.

In this step, we need to do 2 things. First of all, consider and plan out the structure of the group. And this is in the context of the second step to take place. Here, the assets that are the most diluting from the point of view of the insurance element should be a direct part of the holding company, should be directly attached to it. If this is the case, if we were to close it this year, but it's not really likely to happen. Given what must materialize and as of today, we need to change the legal structure for it to happen. And the legal structure given the schedule will be realistic, let's say, by January of next year. First of all, we need to create a holding company. If it's successful, all dividends will either be transferred to the holding company, which is an essential element of PZU SA or will be transferred to the new holding company.

Both the new PZU something, let's call it, operating enterprise, that will be paying out the dividend and the banks will be moved to this new holding company. That's the way to think about it. And only then will it be possible to merge the bank and the holding company. From that moment on, the bank will become the entity regulating dividend payments for the whole group vis-à-vis its shareholders.

I believe it's very difficult to tell you more about the schedule and how it will play out. We do realize one thing. When we plan the sequence of events, we need to make sure that at no point during this organization, reorganization, our shareholders might be harmed. So we need to protect our shareholders. That's our priority. Both Andrzej and Cezary as former President talked about it.

So let's say that the framework in place will be close to what we know. There are some recommendations on profit sharing. Usually, they are published more or less mid-December. We'll have to secure the dividend payer, either it will be PZU SA or the holding company. We need to ensure that the dividend payment runs smoothly. And that's a crucial element of what we do. And we have been talking to the regulator about how actually to make it happen.

And then PLN 3 billion or PLN 5 billion, when it comes to healthcare. In our strategy, we promised PLN 3-plus billion to our shareholders. We try to use our channels. We try to go for cross-selling. We try to increase the premiums. That's right that during the last conference, Andrzej Klesyk mentioned PLN 5 billion, but it wasn't about 2025 horizon. We might get some nonorganic opportunities that is, for example, entering some segments that we are not present in, like hospital segment or there might be some possible takeovers or mergers. As of this year when it comes to acquisitions, we do not see the opportunities to actually reach PLN 5 billion this year. But in a longer time perspective, it's quite likely to challenge the market leader that is LUX MED.

NPS, that's your second question. I would be quite careful here. I don't believe that's a good idea to draw any conclusions on the quality, having spoken to a few people, to a handful of people. What we measure is NPS, that's a ratio of recommendations. Therefore, our help line, it's plus 27% of those who would promote and versus plus 17% that would discourage people from using our services. So we are definitely above the average. And our customer satisfaction score is at over 80%. Personally, I believe that when it comes to quality, it's not a moment to rest on our laurels, we still need to take care of our customers to monitor the level of service availability. What we promise is 2 days for a GP consult and 5 days for a specialized consult. That's our promise.

We do have tools to measure it. And what I see on social media, what I see on LinkedIn, when it comes to the treatment for subscription customers versus private customers, I don't see it in the numbers that we have. We are definitely going to improve the quality of our services, but I don't agree that we are not ready to grow. But at the same time, we will continue working on digitization, we want to launch a mobile-based app. And then we would like to include new services that nobody ever had in their health care mobile-based apps.

If there are no questions in the room, we'll address questions that we have received online. One of them regards severe weather events. And the question is as follows, is from Jaromir Szortyka from PKO BP Securities. Can you give any comments regarding the scale of weather events in this quarter?

Well, yes, but I'm afraid of one thing because I have received exactly the same question in the previous quarter. It was at the beginning of May. And we could be optimistic. We could say, of course, may, of course, there is this period when always, there are some cold days at the beginning of May.

And generally, I do not like to retract on what I've said before because it's embarrassing. We did try to keep all the risks under control, and we do it quite well, except for one thing, weather. So my answer for today is that the severe weather incidents did not affect us and did not generate any mass tendencies. I'm saying this being fully aware that we have no idea what is going to happen weather-wise in Q3. I don't want to say that everything is possible. However, the weather is changeable and it gets even more changeable. And we need to take it into account in property insurance, but also in motor insurance because this affects the levels of risk. And I'll be happy to take another question.

Actually, last year, we had a flood in September, and this only proves that it's good to be prudent when making assumptions.

Very good point, Mr. Zimowicz. Thank you. Second question is from the same person, Jaromir Szortyka from PKO BP Securities. What is the plan of the company for higher capital requirements if the legal changes that will make it possible to create the holding will not enter into force?

Okay. I will do my best to answer this question. Unfortunately, the question is not too precise and the person is not in the room, so I cannot ask for clarification. So if I understand correctly, we are talking about step 1, not about step 2. And we are discussing a hypothetical situation regarding what may happen if in step 1, we will not have the formal and legal possibility to finalize the transformation of our group into a holding.

We know that currently, some acts are pending before the parliament. One of those bills will affect the insurance business, another regards the management of state assets, and this will give possibly the PKO a different qualification as a state asset. And there is another bill regarding the banking law. If those bills are not signed into law, we, first of all, need to understand why, what are the possible reasons for this scenario? Because if we understand it, then there is a chance that maybe we can do something that every -- all interested parties may agree upon. That's the first part of my answer. And if it turns out that there is no room for discussion and that the answer is just no because no. Then what we can do is an implementation of an internal model, which is scheduled for the end of 2026.

This means that we will begin our activity in 2027 with a slightly different take on the risks that are a part of our business. So we will no longer use the one-size-fits-all approach, but we will adopt a model that is better suited for our risk profile. This model, in my opinion, needs to fulfill to purposes, 2 objectives. The first is to better adjust the price to this risk profile, to this specific risk profile and as opposed to a standard model.

The second one is correlated with the fact that we'll be better -- able to better manage this risk. So this will translate into different capital requirements. What I can tell you for now is that, well, we have shared with you some initial estimates when we were presenting to you the vision of PZU, as seen by its new CEO, and these were very initial estimates. It may happen that in the end, will be less capital intensive than the estimates made in our strategy because in the strategy, we assume that the solvency ratio will go below 200. And what we said is that we want to keep the target of 190 because this is what our peers do, and they are our point of reference.

So I think that it is possible that if we implement this model and if we manage to better manage our risk, then we will keep a solvency ratio at a level of 200 or more.

There are no further questions asked online. Do we have any other questions in the room?

Andrzej Powierza, Citi Handlowy Bank. I have a question that regards the presentation and the merger plan with PKO in the future. I would like to ask you about bancassurance specifically. I would like to know if the bancassurance segment will have the opportunity to grow faster in the future setup as compared to now because, of course, I'm aware that the situation is highly changeable, and you need to constantly adjust to it. I believe that the model that we aspire to and the one that we have announced namely a structure in which the bank is the dominant entity gives us more opportunities. Why?

From the perspective of the Alior Bank's Management Board or the PKO Bank Management Board, can it be boiled to one thing, namely revenue that they have from the commission from insurance sales. So this perspective changes substantially if the bank not only receives the commission, but is also a beneficiary of the profit that the insurance segment generates. So this is, in a way, a double reward. So if the bank not only receives the commission, but also receives an income from this revenue, then they are more favorable to this type of solutions.

Moreover, after the merger, it's going to be easier to share data between various entities. And we do have a good example from another banking group, a closer cooperation and exchanging data in real time as far as the mortgage customers go, just to give you an example, is easier. So as a result, it's much easier and more potentially profitable to cross-sell and target clients with multiple products. So the merger can give us the possibility to use the potential of the group to the fullest, the banking insurance group.

Are there any other questions in the room? I don't see any, and there are no further questions online. So thank you for your participation and for your attention. And we'll meet during the presentation of Q3 results in November.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]