{ "documentInfo": { "documentType": "https://xbrl.org/2021/xbrl-json", "features": { "xbrl:canonicalValues": true }, "namespaces": { "ifrs-full": "https://xbrl.ifrs.org/taxonomy/2022-03-24/ifrs-full", "iso4217": "http://www.xbrl.org/2003/iso4217", "mbcp": "http://www.millenniumbcp.pt/20221231", "scheme": "http://standards.iso.org/iso/17442", "xbrl": "https://xbrl.org/2021", "xbrli": "http://www.xbrl.org/2003/instance" }, "taxonomy": [ "http://www.millenniumbcp.pt/20221231/000432-2022-12-31.xsd" ] }, "facts": { "f-1": { "value": "BANCO COMERCIAL PORTUGU\u00caS, S.A.", "dimensions": { "concept": "ifrs-full:NameOfParentEntity", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-2": { "value": "BANCO COMERCIAL PORTUGU\u00caS, S.A.", "dimensions": { "concept": "ifrs-full:NameOfUltimateParentOfGroup", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-3": { "value": "BANCO COMERCIAL PORTUGU\u00caS, S.A.", "dimensions": { "concept": "ifrs-full:NameOfReportingEntityOrOtherMeansOfIdentification", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-4": { "value": "Public limited company", "dimensions": { "concept": "ifrs-full:LegalFormOfEntity", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-5": { "value": "Pra\u00e7a D. Jo\u00e3o I, 28, 4000-295 Porto", "dimensions": { "concept": "ifrs-full:AddressOfRegisteredOfficeOfEntity", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-6": { "value": "The Group provides a wide variety of banking services and financial activities in Portugal and abroad, where it is present in the following markets: Poland, Mozambique, Angola (through its associate BMA) and China (Macao). All its banking operations develop their activity under the Millennium brand. The Group also ensures its international presence through representation offices and/or commercial protocols.The Bank offers a vast range of financial products and services: current accounts, payment systems, savings and investment products, private banking, asset management and investment banking, including mortgage loans, personal loans, commercial banking, leasing, factoring and insurance, among others. The back-office operations for the distribution network are integrated to benefit from economies of scale.In Portugal, Millennium bcp is focused on the retail and companies markets, providing services to its Customers in a segmented manner. The Bank makes products available to Customers through its network of branches, offering a wide range of products and services.", "dimensions": { "concept": "ifrs-full:DescriptionOfNatureOfEntitysOperationsAndPrincipalActivities", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-7": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:CountryOfIncorporation", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-8": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:PrincipalPlaceOfBusiness", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-9": { "value": "Portugal", "dimensions": { "concept": "ifrs-full:DomicileOfEntity", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-10": { "value": "2737235000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RevenueFromInterest", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-11": { "value": "1709124000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RevenueFromInterest", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-12": { "value": "587463000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-13": { "value": "120523000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-14": { "value": "2149772000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestRevenueExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-15": { "value": "1588601000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestRevenueExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-16": { "value": "10086000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RevenueFromDividends", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-17": { "value": "938000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RevenueFromDividends", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-18": { "value": "771908000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FeeAndCommissionIncomeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-19": { "value": "727723000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FeeAndCommissionIncomeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-20": { "value": "27306000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnFinancialAssetsAtFairValueThroughProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-21": { "value": "-247000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnFinancialAssetsAtFairValueThroughProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-22": { "value": "19390000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnExchangeDifferencesOnTranslationRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-23": { "value": "17494000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnExchangeDifferencesOnTranslationRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-24": { "value": "-2233000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainLossOnHedgeIneffectivenessRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-25": { "value": "4286000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainLossOnHedgeIneffectivenessRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-26": { "value": "18883000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainLossArisingFromDerecognitionOfFinancialAssetsMeasuredAtAmortisedCost", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-27": { "value": "-3717000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainLossArisingFromDerecognitionOfFinancialAssetsMeasuredAtAmortisedCost", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-28": { "value": "-13386000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-29": { "value": "68722000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-30": { "value": "-193112000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherOperatingIncomeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-31": { "value": "-128905000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherOperatingIncomeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-32": { "value": "2788614000", "decimals": -3, "dimensions": { "concept": "mbcp:TotalOperatingIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-33": { "value": "2274895000", "decimals": -3, "dimensions": { "concept": "mbcp:TotalOperatingIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-34": { "value": "580807000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EmployeeBenefitsExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-35": { "value": "654270000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EmployeeBenefitsExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-36": { "value": "352961000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GeneralAndAdministrativeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-37": { "value": "324172000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GeneralAndAdministrativeExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-38": { "value": "139250000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepreciationAndAmortisationExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-39": { "value": "137156000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepreciationAndAmortisationExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-40": { "value": "1073018000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OperatingExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-41": { "value": "1115598000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OperatingExpense", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-42": { "value": "1715596000", "decimals": -3, "dimensions": { "concept": "mbcp:ProfitLossFromOperatingActivitiesBeforeProvisionsAndImpairment", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-43": { "value": "1159297000", "decimals": -3, "dimensions": { "concept": "mbcp:ProfitLossFromOperatingActivitiesBeforeProvisionsAndImpairment", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-44": { "value": "-309865000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsWithContractualCashFlowsModifiedDuringReportingPeriodWhileLossAllowanceMeasuredAtLifetimeExpectedCreditLossesModificationGainLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-45": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsWithContractualCashFlowsModifiedDuringReportingPeriodWhileLossAllowanceMeasuredAtLifetimeExpectedCreditLossesModificationGainLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-46": { "value": "300829000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ImpairmentLossOnFinancialAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-47": { "value": "352833000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ImpairmentLossOnFinancialAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-48": { "value": "-5023000", "decimals": -3, "dimensions": { "concept": "mbcp:ImpairmentLossRecognisedInOtherComprehensiveIncomeNetOfReversals", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-49": { "value": "4626000", "decimals": -3, "dimensions": { "concept": "mbcp:ImpairmentLossRecognisedInOtherComprehensiveIncomeNetOfReversals", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-50": { "value": "192059000", "decimals": -3, "dimensions": { "concept": "mbcp:ImpairmentLossForOtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-51": { "value": "60882000", "decimals": -3, "dimensions": { "concept": "mbcp:ImpairmentLossForOtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-52": { "value": "-568297000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ChangesInOtherProvisions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-53": { "value": "-642726000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ChangesInOtherProvisions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-54": { "value": "349569000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-55": { "value": "98230000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-56": { "value": "68722000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfProfitLossOfAssociatesAndJointVenturesAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-57": { "value": "56937000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfProfitLossOfAssociatesAndJointVenturesAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-58": { "value": "10167000", "decimals": -3, "dimensions": { "concept": "mbcp:GainLossesOnDisposalsOfSubsidiariesAndOtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-59": { "value": "2570000", "decimals": -3, "dimensions": { "concept": "mbcp:GainLossesOnDisposalsOfSubsidiariesAndOtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-60": { "value": "428458000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-61": { "value": "157737000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-62": { "value": "109632000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxExpenseIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-63": { "value": "81353000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxExpenseIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-64": { "value": "194688000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxExpenseIncomeRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-65": { "value": "122273000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxExpenseIncomeRecognisedInProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-66": { "value": "124138000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromContinuingOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-67": { "value": "-45889000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromContinuingOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-68": { "value": "5537000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromDiscontinuedOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-69": { "value": "70881000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossFromDiscontinuedOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-70": { "value": "129675000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-71": { "value": "24992000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-72": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossAttributableToOwnersOfParent", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-73": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossAttributableToOwnersOfParent", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-74": { "value": "-77822000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossAttributableToNoncontrollingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-75": { "value": "-113090000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLossAttributableToNoncontrollingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-76": { "value": "129675000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-77": { "value": "24992000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-78": { "value": "0.011", "decimals": 3, "dimensions": { "concept": "ifrs-full:BasicEarningsLossPerShare", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR/xbrli:shares" } }, "f-79": { "value": "0.007", "decimals": 3, "dimensions": { "concept": "ifrs-full:BasicEarningsLossPerShare", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR/xbrli:shares" } }, "f-80": { "value": "0.011", "decimals": 3, "dimensions": { "concept": "ifrs-full:DilutedEarningsLossPerShare", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR/xbrli:shares" } }, "f-81": { "value": "0.007", "decimals": 3, "dimensions": { "concept": "ifrs-full:DilutedEarningsLossPerShare", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR/xbrli:shares" } }, "f-82": { "value": "124138000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-83": { "value": "5537000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-84": { "value": "129675000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-85": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-86": { "value": "-77822000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-87": { "value": "-271021000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-88": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-89": { "value": "-271021000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-90": { "value": "-250622000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-91": { "value": "-20399000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-92": { "value": "-13386000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-93": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-94": { "value": "-13386000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-95": { "value": "-13501000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-96": { "value": "115000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-97": { "value": "-1646366000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-98": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-99": { "value": "-1646366000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-100": { "value": "-1644333000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-101": { "value": "-2033000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-102": { "value": "-107723000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-103": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-104": { "value": "-107723000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-105": { "value": "-107726000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-106": { "value": "3000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-107": { "value": "12616000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-108": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-109": { "value": "12616000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-110": { "value": "18184000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-111": { "value": "-5568000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-112": { "value": "5745000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-113": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-114": { "value": "5745000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-115": { "value": "5745000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-116": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-117": { "value": "-589842000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-118": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-119": { "value": "-589842000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-120": { "value": "-585630000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-121": { "value": "-4212000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-122": { "value": "-1403521000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-123": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-124": { "value": "-1403521000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-125": { "value": "-1379621000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-126": { "value": "-23900000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-127": { "value": "-3796000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-128": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-129": { "value": "-3796000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-130": { "value": "-3183000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-131": { "value": "-613000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-132": { "value": "-63000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-133": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-134": { "value": "-63000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-135": { "value": "-63000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-136": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-137": { "value": "375689000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-138": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-139": { "value": "375689000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-140": { "value": "375689000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-141": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-142": { "value": "8391000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-143": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-144": { "value": "8391000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-145": { "value": "6904000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-146": { "value": "1487000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-147": { "value": "136759000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-148": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-149": { "value": "136759000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-150": { "value": "136681000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-151": { "value": "78000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-152": { "value": "243462000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-153": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-154": { "value": "243462000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-155": { "value": "242666000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-156": { "value": "796000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-157": { "value": "-1160059000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-158": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-159": { "value": "-1160059000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-160": { "value": "-1136955000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-161": { "value": "-23104000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-162": { "value": "-1035921000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-163": { "value": "5537000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-164": { "value": "-1030384000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-165": { "value": "-929458000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-166": { "value": "-100926000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-167": { "value": "-45889000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-168": { "value": "70881000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-169": { "value": "24992000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-170": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-171": { "value": "-113090000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-172": { "value": "-235067000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-173": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-174": { "value": "-235067000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-175": { "value": "-129584000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-176": { "value": "-105483000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-177": { "value": "68722000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-178": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-179": { "value": "68722000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-180": { "value": "67312000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-181": { "value": "1410000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReclassificationAdjustmentsOnFinancialAssetsMeasuredAtFairValueThroughOtherComprehensiveIncomeBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-182": { "value": "-402269000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-183": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-184": { "value": "-402269000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-185": { "value": "-365881000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-186": { "value": "-36388000", "decimals": -3, "dimensions": { "concept": "ifrs-full:GainsLossesOnCashFlowHedgesBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-187": { "value": "-2723000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-188": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-189": { "value": "-2723000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-190": { "value": "-2717000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-191": { "value": "-6000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ShareOfOtherComprehensiveIncomeOfAssociatesAndJointVenturesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-192": { "value": "111698000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-193": { "value": "-2129000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-194": { "value": "109569000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-195": { "value": "78410000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-196": { "value": "31159000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxExchangeDifferencesOnTranslation", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-197": { "value": "-1040000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-198": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-199": { "value": "-1040000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-200": { "value": "-1040000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-201": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentForIas29ApplicationOfOtherComprehensiveIncomeOfAssociatesAccountedForUsingEquityMethodThatWillBeReclassifiedToProfitOrLossBeforeTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-202": { "value": "-185425000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-203": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-204": { "value": "-185425000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-205": { "value": "-158263000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-206": { "value": "-27162000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-207": { "value": "-412698000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-208": { "value": "-2129000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-209": { "value": "-414827000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-210": { "value": "-329861000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-211": { "value": "-84966000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-212": { "value": "1073000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-213": { "value": "85000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-214": { "value": "1158000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-215": { "value": "1231000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-216": { "value": "-73000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxGainsLossesFromInvestmentsInEquityInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-217": { "value": "-348000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-218": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-219": { "value": "-348000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-220": { "value": "-348000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-221": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeBeforeTaxChangeInFairValueOfFinancialLiabilityAttributableToChangeInCreditRiskOfLiability", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-222": { "value": "135285000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-223": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-224": { "value": "135285000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-225": { "value": "135285000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-226": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfDefinedBenefitPlansThatShareRisksBetweenEntitiesUnderCommonControl", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-227": { "value": "-697000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-228": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-229": { "value": "-697000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-230": { "value": "-1123000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-231": { "value": "426000", "decimals": -3, "dimensions": { "concept": "mbcp:OtherComprehensiveIncomeBeforeTaxGainsLossesOnRemeasurementsOfPensionFundsOfForeignSubsidiariesAndAssociatedCompanies", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-232": { "value": "7287000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-233": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-234": { "value": "7287000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-235": { "value": "7256000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-236": { "value": "31000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxRelatingToComponentsOfOtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-237": { "value": "128026000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-238": { "value": "85000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-239": { "value": "128111000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-240": { "value": "127789000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-241": { "value": "322000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncomeThatWillNotBeReclassifiedToProfitOrLossNetOfTax", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-242": { "value": "-284672000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-243": { "value": "-2044000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-244": { "value": "-286716000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-245": { "value": "-202072000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-246": { "value": "-84644000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-247": { "value": "-330561000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-248": { "value": "68837000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:DiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-249": { "value": "-261724000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-250": { "value": "-63990000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-251": { "value": "-197734000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-252": { "value": "6022001000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndBankBalancesAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-253": { "value": "7796299000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndBankBalancesAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-254": { "value": "213460000", "decimals": -3, "dimensions": { "concept": "mbcp:LoansAndAdvancesToBanksRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-255": { "value": "361786000", "decimals": -3, "dimensions": { "concept": "mbcp:LoansAndAdvancesToBanksRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-256": { "value": "963434000", "decimals": -3, "dimensions": { "concept": "ifrs-full:LoansAndAdvancesToBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-257": { "value": "453213000", "decimals": -3, "dimensions": { "concept": "ifrs-full:LoansAndAdvancesToBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-258": { "value": "54675793000", "decimals": -3, "dimensions": { "concept": "ifrs-full:LoansAndAdvancesToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-259": { "value": "54972401000", "decimals": -3, "dimensions": { "concept": "ifrs-full:LoansAndAdvancesToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-260": { "value": "13035582000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DebtInstrumentsHeld", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-261": { "value": "8205196000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DebtInstrumentsHeld", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-262": { "value": "766597000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossClassifiedAsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-263": { "value": "931485000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossClassifiedAsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-264": { "value": "552679000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossMandatorilyMeasuredAtFairValue", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-265": { "value": "990938000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossMandatorilyMeasuredAtFairValue", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-266": { "value": "7461553000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-267": { "value": "12890988000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialAssetsAtFairValueThroughOtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-268": { "value": "59703000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DerivativeFinancialAssetsHeldForHedging", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-269": { "value": "109059000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DerivativeFinancialAssetsHeldForHedging", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-270": { "value": "298717000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InvestmentsInAssociates", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-271": { "value": "462338000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InvestmentsInAssociates", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-272": { "value": "499035000", "decimals": -3, "dimensions": { "concept": "ifrs-full:NoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSale", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-273": { "value": "780514000", "decimals": -3, "dimensions": { "concept": "ifrs-full:NoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSale", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-274": { "value": "15217000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InvestmentProperty", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-275": { "value": "2870000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InvestmentProperty", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-276": { "value": "574697000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherPropertyPlantAndEquipment", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-277": { "value": "600721000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherPropertyPlantAndEquipment", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-278": { "value": "182687000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IntangibleAssetsAndGoodwill", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-279": { "value": "256213000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IntangibleAssetsAndGoodwill", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-280": { "value": "17945000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-281": { "value": "17283000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-282": { "value": "2938986000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-283": { "value": "2688216000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-284": { "value": "1582455000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-285": { "value": "1385292000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-286": { "value": "89860541000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Assets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-287": { "value": "92904812000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Assets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-288": { "value": "1468360000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepositsFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-289": { "value": "8896074000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepositsFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-290": { "value": "75430143000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepositsFromCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-291": { "value": "69560227000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DepositsFromCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-292": { "value": "1482086000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-293": { "value": "2188363000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-294": { "value": "1333056000", "decimals": -3, "dimensions": { "concept": "ifrs-full:SubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-295": { "value": "1394780000", "decimals": -3, "dimensions": { "concept": "ifrs-full:SubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-296": { "value": "241506000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLossClassifiedAsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-297": { "value": "231241000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLossClassifiedAsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-298": { "value": "1817678000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-299": { "value": "1581778000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-300": { "value": "178000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DerivativeFinancialLiabilitiesHeldForHedging", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-301": { "value": "377206000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DerivativeFinancialLiabilitiesHeldForHedging", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-302": { "value": "561786000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Provisions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-303": { "value": "458744000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Provisions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-304": { "value": "23680000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-305": { "value": "20427000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CurrentTaxLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-306": { "value": "11708000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-307": { "value": "16932000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DeferredTaxLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-308": { "value": "1391973000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-309": { "value": "1116983000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-310": { "value": "83939976000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Liabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-311": { "value": "85842755000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Liabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-312": { "value": "3000000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IssuedCapital", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-313": { "value": "4725000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IssuedCapital", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-314": { "value": "16471000", "decimals": -3, "dimensions": { "concept": "ifrs-full:SharePremium", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-315": { "value": "16471000", "decimals": -3, "dimensions": { "concept": "ifrs-full:SharePremium", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-316": { "value": "400000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherEquityInterest", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-317": { "value": "400000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherEquityInterest", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-318": { "value": "268534000", "decimals": -3, "dimensions": { "concept": "ifrs-full:StatutoryReserve", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-319": { "value": "259528000", "decimals": -3, "dimensions": { "concept": "ifrs-full:StatutoryReserve", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-320": { "value": "1245949000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-321": { "value": "580304000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-322": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "mbcp:NetIncomeForTheYearAttributableToBanksShareholders", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-323": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "mbcp:NetIncomeForTheYearAttributableToBanksShareholders", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-324": { "value": "5138451000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EquityAttributableToOwnersOfParent", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-325": { "value": "6119385000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EquityAttributableToOwnersOfParent", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-326": { "value": "782114000", "decimals": -3, "dimensions": { "concept": "ifrs-full:NoncontrollingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-327": { "value": "942672000", "decimals": -3, "dimensions": { "concept": "ifrs-full:NoncontrollingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-328": { "value": "5920565000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-329": { "value": "7062057000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-330": { "value": "89860541000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EquityAndLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-331": { "value": "92904812000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EquityAndLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-332": { "value": "2297720000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestReceivedClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-333": { "value": "1610633000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestReceivedClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-334": { "value": "1019734000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromRoyaltiesFeesCommissionsAndOtherRevenue", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-335": { "value": "925786000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromRoyaltiesFeesCommissionsAndOtherRevenue", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-336": { "value": "101771000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromSalesOfGoodsAndRenderingOfServices", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-337": { "value": "110095000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromSalesOfGoodsAndRenderingOfServices", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-338": { "value": "363636000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-339": { "value": "182934000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-340": { "value": "176465000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinanceCostsPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-341": { "value": "145957000", "decimals": -3, "dimensions": { "concept": "ifrs-full:FinanceCostsPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-342": { "value": "20837000", "decimals": -3, "dimensions": { "concept": "mbcp:RecoveriesOnLoansPreviouslyWrittenOff", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-343": { "value": "22938000", "decimals": -3, "dimensions": { "concept": "mbcp:RecoveriesOnLoansPreviouslyWrittenOff", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-344": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromPremiumsAndClaimsAnnuitiesAndOtherPolicyBenefits", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-345": { "value": "20975000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ReceiptsFromPremiumsAndClaimsAnnuitiesAndOtherPolicyBenefits", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-346": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsForPremiumsAndClaimsAnnuitiesAndOtherPolicyBenefits", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-347": { "value": "7827000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsForPremiumsAndClaimsAnnuitiesAndOtherPolicyBenefits", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-348": { "value": "1220319000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsToSuppliersForGoodsAndServicesAndToAndOnBehalfOfEmployees", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-349": { "value": "1250979000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsToSuppliersForGoodsAndServicesAndToAndOnBehalfOfEmployees", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-350": { "value": "65340000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxesPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-351": { "value": "61834000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncomeTaxesPaidClassifiedAsOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-352": { "value": "1614302000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-353": { "value": "1040896000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInOperations", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-354": { "value": "-227767000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesToBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-355": { "value": "204997000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesToBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-356": { "value": "-280418000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForIncreaseDecreaseInDepositsForPurposeOfMonetaryControlFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-357": { "value": "190049000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForIncreaseDecreaseInDepositsForPurposeOfMonetaryControlFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-358": { "value": "-656569000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-359": { "value": "-4192195000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-360": { "value": "136605000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInFinancialAssetsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-361": { "value": "45161000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForDecreaseIncreaseInFinancialAssetsHeldForTrading", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-362": { "value": "-25447000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForIncreaseDecreaseInLoansAndAdvancesToBanksRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-363": { "value": "-42783000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForIncreaseDecreaseInLoansAndAdvancesToBanksRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-364": { "value": "-7518189000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForIncreaseDecreaseInDepositsFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-365": { "value": "94089000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForIncreaseDecreaseInDepositsFromBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-366": { "value": "-274554000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesRepayableOnDemandToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-367": { "value": "6589819000", "decimals": -3, "dimensions": { "concept": "mbcp:AdjustmentsForDecreaseIncreaseInLoansAndAdvancesRepayableOnDemandToCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-368": { "value": "6652456000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForIncreaseDecreaseInDepositsFromCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-369": { "value": "481649000", "decimals": -3, "dimensions": { "concept": "ifrs-full:AdjustmentsForIncreaseDecreaseInDepositsFromCustomers", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-370": { "value": "-579581000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-371": { "value": "4411682000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInOperatingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-372": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromSalesOfInvestmentsAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-373": { "value": "4809000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromSalesOfInvestmentsAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-374": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-375": { "value": "2252000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethod", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-376": { "value": "54263000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsReceivedClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-377": { "value": "16651000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsReceivedClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-378": { "value": "342405000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestReceivedClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-379": { "value": "199303000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestReceivedClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-380": { "value": "7922631000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromSalesOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-381": { "value": "6552698000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromSalesOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-382": { "value": "50657550000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-383": { "value": "58763208000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-384": { "value": "42276068000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromMaturityOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-385": { "value": "49315510000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromMaturityOfFinancialInstrumentsClassifiedAsInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-386": { "value": "126189000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfPropertyPlantAndEquipmentIntangibleAssetsOtherThanGoodwillInvestmentPropertyAndOtherNoncurrentAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-387": { "value": "80464000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PurchaseOfPropertyPlantAndEquipmentIntangibleAssetsOtherThanGoodwillInvestmentPropertyAndOtherNoncurrentAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-388": { "value": "9434000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromDisposalsOfPropertyPlantAndEquipmentIntangibleAssetsOtherThanGoodwillInvestmentPropertyAndOtherNoncurrentAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-389": { "value": "13614000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromDisposalsOfPropertyPlantAndEquipmentIntangibleAssetsOtherThanGoodwillInvestmentPropertyAndOtherNoncurrentAssets", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-390": { "value": "-386643000", "decimals": -3, "dimensions": { "concept": "mbcp:DecreaseIncreaseInOtherSundryAssetsComponentOfInvestmentActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-391": { "value": "44657000", "decimals": -3, "dimensions": { "concept": "mbcp:DecreaseIncreaseInOtherSundryAssetsComponentOfInvestmentActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-392": { "value": "-565581000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-393": { "value": "-2698682000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInInvestingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-394": { "value": "133700000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromIssueOfSubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-395": { "value": "300000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromIssueOfSubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-396": { "value": "133700000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RepaymentsOfSubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-397": { "value": "305368000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RepaymentsOfSubordinatedLiabilities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-398": { "value": "402264000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromIssueOfDebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-399": { "value": "998439000", "decimals": -3, "dimensions": { "concept": "mbcp:ProceedsFromIssueOfDebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-400": { "value": "1156473000", "decimals": -3, "dimensions": { "concept": "mbcp:RepaymentsOfDebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-401": { "value": "246018000", "decimals": -3, "dimensions": { "concept": "mbcp:RepaymentsOfDebtSecurities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-402": { "value": "34505000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromIssueOfBondsNotesAndDebentures", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-403": { "value": "105708000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProceedsFromIssueOfBondsNotesAndDebentures", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-404": { "value": "12374000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RepaymentsOfBondsNotesAndDebentures", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-405": { "value": "26074000", "decimals": -3, "dimensions": { "concept": "ifrs-full:RepaymentsOfBondsNotesAndDebentures", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-406": { "value": "13603000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaidToEquityHoldersOfParentClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-407": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaidToEquityHoldersOfParentClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-408": { "value": "59572000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaidToNoncontrollingInterestsClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-409": { "value": "17516000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaidToNoncontrollingInterestsClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-410": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestPaidClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-411": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:InterestPaidClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-412": { "value": "52175000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseInOtherSundryLiabilitiesAndNonControllingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-413": { "value": "-2914000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseInOtherSundryLiabilitiesAndNonControllingInterests", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-414": { "value": "-790078000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-415": { "value": "769257000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashFlowsFromUsedInFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-416": { "value": "12616000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EffectOfExchangeRateChangesOnCashAndCashEquivalents", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-417": { "value": "109569000", "decimals": -3, "dimensions": { "concept": "ifrs-full:EffectOfExchangeRateChangesOnCashAndCashEquivalents", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-418": { "value": "-1922624000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseInCashAndCashEquivalents", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-419": { "value": "2591826000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseInCashAndCashEquivalents", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-420": { "value": "601772000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Cash", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-421": { "value": "579997000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Cash", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-422": { "value": "7194527000", "decimals": -3, "dimensions": { "concept": "mbcp:DepositsAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-423": { "value": "4723867000", "decimals": -3, "dimensions": { "concept": "mbcp:DepositsAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-424": { "value": "361786000", "decimals": -3, "dimensions": { "concept": "mbcp:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPositionLoansAndAdvancesToCreditInstitutionsRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-425": { "value": "262395000", "decimals": -3, "dimensions": { "concept": "mbcp:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPositionLoansAndAdvancesToCreditInstitutionsRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-426": { "value": "8158085000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPosition", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-427": { "value": "5566259000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPosition", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-428": { "value": "593033000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Cash", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-429": { "value": "601772000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Cash", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-430": { "value": "5428968000", "decimals": -3, "dimensions": { "concept": "mbcp:DepositsAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-431": { "value": "7194527000", "decimals": -3, "dimensions": { "concept": "mbcp:DepositsAtCentralBanks", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-432": { "value": "213460000", "decimals": -3, "dimensions": { "concept": "mbcp:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPositionLoansAndAdvancesToCreditInstitutionsRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-433": { "value": "361786000", "decimals": -3, "dimensions": { "concept": "mbcp:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPositionLoansAndAdvancesToCreditInstitutionsRepayableOnDemand", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-434": { "value": "6235461000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPosition", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-435": { "value": "8158085000", "decimals": -3, "dimensions": { "concept": "ifrs-full:CashAndCashEquivalentsIfDifferentFromStatementOfFinancialPosition", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-436": { "value": "590000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ExpenseRelatingToShorttermLeasesForWhichRecognitionExemptionHasBeenUsed", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-437": { "value": "581000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ExpenseRelatingToShorttermLeasesForWhichRecognitionExemptionHasBeenUsed", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-438": { "value": "2402000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ExpenseRelatingToLeasesOfLowvalueAssetsForWhichRecognitionExemptionHasBeenUsed", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-439": { "value": "2564000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ExpenseRelatingToLeasesOfLowvalueAssetsForWhichRecognitionExemptionHasBeenUsed", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-440": { "value": "53330000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsOfLeaseLiabilitiesClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-441": { "value": "58206000", "decimals": -3, "dimensions": { "concept": "ifrs-full:PaymentsOfLeaseLiabilitiesClassifiedAsFinancingActivities", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-442": { "value": "4725000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-443": { "value": "16471000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:SharePremiumMember", "unit": "iso4217:EUR" } }, "f-444": { "value": "400000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherEquityInterestMember", "unit": "iso4217:EUR" } }, "f-445": { "value": "254464000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-446": { "value": "-40000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-447": { "value": "642397000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-448": { "value": "183012000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-449": { "value": "6221304000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-450": { "value": "1164966000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-451": { "value": "7386270000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-452": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-453": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-454": { "value": "-113090000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-455": { "value": "24992000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-456": { "value": "-202072000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-457": { "value": "-202072000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-458": { "value": "-84644000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-459": { "value": "-286716000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-460": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-461": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:SharePremiumMember", "unit": "iso4217:EUR" } }, "f-462": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherEquityInterestMember", "unit": "iso4217:EUR" } }, "f-463": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-464": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-465": { "value": "-202072000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-466": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-467": { "value": "-63990000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-468": { "value": "-197734000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-469": { "value": "-261724000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-470": { "value": "5064000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-471": { "value": "-5064000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-472": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-473": { "value": "183012000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-474": { "value": "-183012000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-475": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-476": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-477": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-478": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-479": { "value": "-1906000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAcquisitionOfSubsidiary", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-480": { "value": "-1906000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAcquisitionOfSubsidiary", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-481": { "value": "-4556000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughDisposalOfSubsidiary", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-482": { "value": "-4556000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughDisposalOfSubsidiary", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-483": { "value": "17516000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "ifrs-full:ConsolidatedStructuredEntitiesAxis": "mbcp:BancoInternacionalMocambiqueAndSeguradoraInternacionalMocambiqueMember", "unit": "iso4217:EUR" } }, "f-484": { "value": "17516000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ConsolidatedStructuredEntitiesAxis": "mbcp:BancoInternacionalMocambiqueAndSeguradoraInternacionalMocambiqueMember", "unit": "iso4217:EUR" } }, "f-485": { "value": "40000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTreasuryShareTransactions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-486": { "value": "40000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTreasuryShareTransactions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-487": { "value": "40000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTreasuryShareTransactions", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-488": { "value": "-969000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-489": { "value": "-969000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-490": { "value": "-582000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-491": { "value": "-1551000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2021-01-01T00:00:00/2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-492": { "value": "4725000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-493": { "value": "16471000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:SharePremiumMember", "unit": "iso4217:EUR" } }, "f-494": { "value": "400000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherEquityInterestMember", "unit": "iso4217:EUR" } }, "f-495": { "value": "259528000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-496": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-497": { "value": "580304000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-498": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-499": { "value": "6119385000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-500": { "value": "942672000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-501": { "value": "7062057000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-502": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-503": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-504": { "value": "-77822000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-505": { "value": "129675000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ProfitLoss", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-506": { "value": "-1136955000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-507": { "value": "-1136955000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-508": { "value": "-23104000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-509": { "value": "-1160059000", "decimals": -3, "dimensions": { "concept": "ifrs-full:OtherComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-510": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-511": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:SharePremiumMember", "unit": "iso4217:EUR" } }, "f-512": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherEquityInterestMember", "unit": "iso4217:EUR" } }, "f-513": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-514": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-515": { "value": "-1136955000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-516": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-517": { "value": "-929458000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-518": { "value": "-100926000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-519": { "value": "-1030384000", "decimals": -3, "dimensions": { "concept": "ifrs-full:ComprehensiveIncome", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ContinuingAndDiscontinuedOperationsAxis": "ifrs-full:AggregateContinuingAndDiscontinuedOperationsMember", "unit": "iso4217:EUR" } }, "f-520": { "value": "9006000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-521": { "value": "-9006000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-522": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseThroughTransferToLegalReserveEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-523": { "value": "138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-524": { "value": "-138082000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-525": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughAppropriationOfRetainedEarnings", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-526": { "value": "13603000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-527": { "value": "13603000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-528": { "value": "13603000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-529": { "value": "-1725000000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseInShareCapital", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-530": { "value": "1725000000", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseInShareCapital", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-531": { "value": "0", "decimals": -3, "dimensions": { "concept": "mbcp:IncreaseDecreaseInShareCapital", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-532": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-533": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-534": { "value": "37000000", "decimals": -3, "dimensions": { "concept": "mbcp:InterestOfConvertibleInstruments", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-535": { "value": "59572000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "ifrs-full:ConsolidatedStructuredEntitiesAxis": "mbcp:BancoInternacionalMocambiqueAndSeguradoraInternacionalMocambiqueMember", "unit": "iso4217:EUR" } }, "f-536": { "value": "59572000", "decimals": -3, "dimensions": { "concept": "ifrs-full:DividendsPaid", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ConsolidatedStructuredEntitiesAxis": "mbcp:BancoInternacionalMocambiqueAndSeguradoraInternacionalMocambiqueMember", "unit": "iso4217:EUR" } }, "f-537": { "value": "-873000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-538": { "value": "-873000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-539": { "value": "-60000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-540": { "value": "-933000", "decimals": -3, "dimensions": { "concept": "ifrs-full:IncreaseDecreaseThroughTransfersAndOtherChangesEquity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-541": { "value": "3000000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:IssuedCapitalMember", "unit": "iso4217:EUR" } }, "f-542": { "value": "16471000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:SharePremiumMember", "unit": "iso4217:EUR" } }, "f-543": { "value": "400000000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherEquityInterestMember", "unit": "iso4217:EUR" } }, "f-544": { "value": "268534000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:StatutoryReserveMember", "unit": "iso4217:EUR" } }, "f-545": { "value": "0", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:TreasurySharesMember", "unit": "iso4217:EUR" } }, "f-546": { "value": "1245949000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:OtherReservesMember", "unit": "iso4217:EUR" } }, "f-547": { "value": "207497000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "mbcp:NetIncomeForTheYearAttributableToBanksShareholdersMember", "unit": "iso4217:EUR" } }, "f-548": { "value": "5138451000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:EquityAttributableToOwnersOfParentMember", "unit": "iso4217:EUR" } }, "f-549": { "value": "782114000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "ifrs-full:ComponentsOfEquityAxis": "ifrs-full:NoncontrollingInterestsMember", "unit": "iso4217:EUR" } }, "f-550": { "value": "5920565000", "decimals": -3, "dimensions": { "concept": "ifrs-full:Equity", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2023-01-01T00:00:00", "unit": "iso4217:EUR" } }, "f-551": { "value": "Accounting policies
A.Basis of presentation
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the Bank
and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the years ended
on 31 December 2022 and 2021.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2022 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in Portuguese. In
the event of discrepancies, the Portuguese version prevails.
A1.Comparative information
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1 January 2022.
The accounting policies were applied consistently to all entities of the Group and are consistent with those used in the
preparation of the financial statements of the previous period.
The Group's financial statements were prepared under the going concern assumption, the accrual-based accounting
regime and under the historical cost convention, as modified by the application of fair value for derivative financial
instruments, financial assets and liabilities at fair value through profit or loss and financial assets at fair value through
other comprehensive income. Financial assets and liabilities that are covered under hedge accounting are stated at fair
value in respect of the risk that is being hedged, if applicable. Other financial assets and liabilities and non-financial
assets and liabilities are stated at amortised cost or historical cost. Non-current assets and disposal groups held for sale
are stated at the lower of carrying amount or fair value less costs to sell. The liability for defined benefit obligations is
recognised as the present value of the past liabilities with pensions net of the value of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice of
the Executive Committee, to make judgments, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and associated
assumptions are based on historical experience and other factors that are believed to be reasonable under the
circumstances and form the basis for making the judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimations. The issues involving a higher
degree of judgment or complexity or for which assumptions and estimations are significant are presented in note 1.Y.
B.Basis of consolidation
As from 1 January 2010, the Group began to apply IFRS 3 (revised) for the accounting of business combinations. The
changes in the accounting policies resulting from the application of IFRS 3 (revised) are applied prospectively.
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the Bank
and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1.Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
B2.Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3.Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
B4.Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is accounted as a
transaction with shareholders and, therefore, no additional goodwill resulting from this transaction is recognised. The
difference between the acquisition cost and the fair value of non-controlling interests acquired is recognised directly in
reserves. On this basis, the gains and losses resulting from the sale of controlling interests that do not impact the
control position of a subsidiary are always recognised against reserves.
B5.Loss of control
The gains and losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6.Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity methods,
exchange differences, between the conversion to euros of the equity at the beginning of the year and its value in euros
at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are recognised against
\u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that are designated and
qualified as hedging instruments related to foreign operations are recorded in equity under \"Reserves and retained
earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted against profit and loss of the
year.
The income and expenses of these subsidiaries are converted to euros at an approximate rate of the rates on the dates
of the transactions, using a monthly average considering the initial and final exchange rates of each month. Exchange
differences from the conversion to euros of the profits and losses for the reporting period, arising from the difference
between the exchange rate used in the income statement and the exchange rate prevailing at the balance sheet date,
are recognised in \"Reserves and retained earnings - exchange differences resulting from the consolidation of Group's
companies\". The exchange rates used by the Group are detailed in note 54.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to the
investment in the foreign operation and to the associated hedge transaction previously recognised in reserves are
transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associated companies, its effects are included in
the Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items are
recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy until 31
December 2018. This classification is no longer applicable as of 1 January 2019.
B7.Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from these
transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains and losses
arising from transactions with associates and jointly controlled entities are eliminated in the proportion of the Group's
investment in these entities.
C.Financial instruments (IFRS 9)
C1.Financial assets
C1.1.Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013\u201cFinancial assets at amortised cost\u201d;
\u2013\u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013\u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013the Group's business model for the management of the financial asset; and,
\u2013the characteristics of the contractual cash flows of the financial asset.
Business Model Evaluation
With reference to 1 January 2018, the Group carried out an evaluation of the business model in which the financial
instruments are held at portfolio level, since this approach reflects how assets are managed and how that information
is made available to management bodies. The information considered in this evaluation included:
\u2013the policies and purposes established for the portfolio and the practical operability of these policies, including how
the management strategy focuses on receiving contractual interest, maintaining a certain interest rate profile,
adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the realization
of cash flows through the sale of the assets;
\u2013how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013the evaluation of the risks that affect the performance of the business model (and of the financial assets held under
this business model) and the way these risks are managed;
\u2013the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the assets
under management or on contractual cash flows received; and,
\u2013the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the expectations
about future sales. However, sales information should not be considered individually, but as part of an overall
assessment of how the Group establishes financial asset management objectives and how cash flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured at
fair value through profit or loss because they are not held either for the collection of contractual cash flows (HTC), nor
for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial recognition.
\"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with the amount
owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk and
administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation included
the analysis of the existence of situations in which the contractual terms can modify the periodicity and the amount of
the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group considered:
\u2013contingent events that may change the periodicity and the amount of the cash flows;
\u2013characteristics that result in leverage;
\u2013terms of prepayment and extension of maturity;
\u2013terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal value;
\u2013the prepayment represents substantially the nominal amount of the contract plus accrued contractual interest, but
not paid (may include reasonable compensation for prepayment); and,
\u2013the prepaid fair value is insignificant at initial recognition.
C1.1.1.Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following conditions
are met:
\u2013the financial asset is held within a business model whose objective is to hold financial assets in order to collect their
contractual cash flows; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and advances
to customers and debt instruments managed based on a business model whose purpose is to receive their contractual
cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
C1.1.2.Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive income\"
if both of the following conditions are met:
\u2013the financial asset is held within a business model whose objective is both to collect its contractual cash flows and
to sell this financial asset; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent retribution
recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may irrevocably choose to
classify it in the category of \"Financial assets at fair value through other comprehensive income\" (FVOCI). This option is
exercised on a case-by-case basis and is only available for financial instruments that comply with the definition of
equity instruments provided in IAS 32 and cannot be used for financial instruments whose classification as an equity
instrument under the scope of the issuer is made under the exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
C1.1.3.Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2.Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management has
changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including the
ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other comprehensive income is
not allowed, nor of financial instruments designated at fair value through profit or loss.
C1.3.Modification and derecognition of financial assets
General principles
i)The Group shall derecognise a financial asset when, and only when:
\u2013the contractual rights to the cash flows from the financial asset expire; or,
\u2013it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii)The Group transfers a financial asset if, and only if, it either:
\u2013transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to
pay the cash flows to one or more recipients in an arrangement that meets the conditions presented in note iii).
iii)When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'), but
assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'), the
Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are met:
\u2013the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without material
delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents
(as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the collection date until the
date of required remittance to the eventual recipients, and interest earned on such investments is passed to the
eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and benefits arising from owning the financial asset. In this case:
\u2013if the Group transfers substantially all the risks and benefits arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013if the Group retains substantially all the risks and benefits arising from owning the financial asset, it shall continue
to recognise the financial asset;
\u2013if the Group neither transfers nor retains substantially all the risks and benefits arising from owning the financial
asset, it shall determine whether it retained control of the financial asset. In this case:
a)if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as assets or
liabilities, any rights and obligations created or retained in the transfer;
b)if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and benefits (see prior note) is evaluated by comparing the Group\u2019s exposure, before and after
the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset depends
on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in its entirety
to an unrelated third party and can exercise that ability unilaterally without needing to impose additional
restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of new
ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that may lead
to the derecognition of a financial asset.
The Bank considers that a modification of the terms and conditions of a credit exposure will result in derecognition of
the transaction and in recognition of a new transaction when the modification translates into at least one of the
following conditions:
\u2013creation of a new exposure that results from a debt consolidation, without any any of the derecognized instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to the
residual maturity in the moment of the modification;
\u2013Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or managed
within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on the
financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv of
the above paragraph should be checked (the other criteria listed in this paragraph are not relevant in such situations).
Under the regulatory changes that occurred in Poland described in note 48 and those negotiated with customers holding
mortgage loans in foreign currency described in note 57, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a given
asset is not derecognised, Bank Millennium adjusts the gross book value of the financial asset and recognises the profit
or loss due to the modification in the Income Statement - Results on modification. The adjustment to the gross carrying
amount of a financial asset is the difference between the discounted cash flows before and after contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its entirety
or partially. Loans written-off are recognised in off-balance sheet accounts.
C1.4.Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit impairment
in the moment of their initial recognition. An asset is credit-impaired if one or more events have occurred with a
negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013financial assets arising from a recovery process, where there have been changes to the terms and conditions of the
original agreement, which presented objective evidence of impairment that resulted in its derecognition (note C1.3)
and recognition of a new contract that reflects the credit losses incurred;
\u2013financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses (ECL)
are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition, the gross
book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value before being
recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5.Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2.Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the income
statement under \"Impairment of financial assets at fair value through other comprehensive income\", against other
comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3.Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are recognised in
liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other provisions\" (in the
income statement).
C1.5.2.Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
C1.5.3.Significant increase in credit risk (SICR)
Significant increase in credit risk (SICR) is determined according to a set of mostly quantitative, but also qualitative
criteria. These criteria are mainly based on the risk grades of customers, according to the Bank's Rating Master Scale,
and on its evolution, in order to detect significant increases in Probability of Default (PD), complemented by other
information regarding the customers\u2019 behaviour towards the financial system.
C1.5.4.Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than Euros 100 (retail) or more than Euros 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in which the
customer is in this situation have been counted, it is classified as default (or GR15).
The existence of a material payment delay gives rise to the default setting (GR15) of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i.Credit restructuring due to financial difficulties with loss of value;
ii.Delay after restructuring due to financial difficulties;
iii.Recurrence of restructuring due to financial difficulties;
iv.Credit with signs of impairment (or stage 3 of IFRS 9);
v.Insolvency or equivalent proceedings;
vi.Litigation;
vii.Guarantees of operations in default;
viii.Credit sales with losses;
ix.Credit fraud;
x.Unpaid credit status;
xi.Breach of covenants in a credit agreement;
xii.Spread of default in an economic group;
xiii.Cross default in BCP Group.
C1.5.5.Estimates of expected credit losses - Individual analysis
1.Customers who are in one of the following conditions are subject to individual analysis:
Customers in default
Customers in litigation or insolvency, if the total exposure of the group members in these situations exceeds
Euros 1 million
Customers integrated into groups with an exposure over Euros 5 million, if they have a risk grade 15
Groups or customers
who are not in
default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over Euros 5 million, if a group member has a risk grade 14
Groups or customers with an exposure over Euros 5 million, if a member of the group has a restructured loan
and a risk grade 13
Groups or customers with an exposure over Euros 10 million, if at least one member of the group is in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds Euros 25 million
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
6.Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery period
to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk Office as
part of the regular process of collecting information, accompanied by detailed justification of the proposed
impairment.
7.The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be a
weighted rate considering the different recovery prospects for each part of the customer's liabilities.
8.The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualized perspective, the latter when cases that, due to their specificity, have a
high degree of uncertainty regarding the expected recovery estimation are identified.
9.The macroeconomic adjustment set out in point 8 should be analysed annually and weighted according to the type
of recovery strategy associated with the exposure under analysis:
\u2013for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global way,
to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one scenario;
\u2013for Gone Concern strategies (i.e., the recovery estimation is based on the realization of the collateral), the impact
of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the projected real
estate index indicates significant changes ahead for the current valuation values.
10.It is the responsibility of the units referred to in point 5 to consider in their projection macroeconomic expectations
that may influence the recoverability of the debt.
11.For the purposes of the preceding paragraphs, the Economic Studies, Sustainability and Cryptoassets Department
shall disclose the macroeconomic data that allow the estimations to be made.
12.The decision to consider global impacts related to the going and gone concern scenarios should be made by the Risk
Committee, as proposed by the Risk Office.
13.For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be considered
casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013recovery of collateral in geographies in which the Bank has no relevant recovery experience;
\u2013recovery of debt related to geographies in which there is strong political instability;
\u2013recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013recovery of debt related to debtors for whom there is a strong negative public exposure.
14. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
15.Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 12 of the Master Scale.
16.The individual impairment analysis must be carried out at least annually. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to promote
the review of the expected impairment of this customer.
C1.5.6.Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis are grouped considering their risk characteristics
and subject to a collective impairment analysis. The Group's credit portfolio is divided by internal risk grades and
according to the following segments:
a)Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project finance,
Institutions (banks/financial institutions) and Sovereigns;
b)Segments not \u2018low default\u2019: - Retail: Mortgages; Overdrafts; Credit cards; Small and medium enterprises - Retail
(\u2018SME Retail\u2019); and Others - Corporate: Small and medium enterprises - Corporate (\u2018Large SME\u2019); and Real Estate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013financial assets with no signs of impairment at the reporting date: the present value of the difference between the
contractual cash flows and the cash flows that the Group expects to receive;
\u2013financial assets with impairment at the reporting date: the difference between the gross book value and the present
value of the estimated cash flows;
\u2013unused credit commitments: the present value of the difference between the resulting contractual cash flows if the
commitment is made and the cash flows that the Group expects to receive;
\u2013financial guarantees: the current value of the expected repayments less the amounts that the Group expects to
recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013Probability of Default \u2013 PD;
\u2013Loss Given Default \u2013 LGD; and,
\u2013Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering the
already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These models
are based on internal data including both quantitative and qualitative factors. If there is a change in the risk of the
counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated considering the
contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates the
LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models consider
the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs. In the case
of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of high relevance
in the determination of LGD.
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD values
from the counterparty's current exposure and potential changes to its current value as a result of the contractual
conditions, including amortisations and prepayments. For commitments and financial guarantees, the value of the EAD
will consider both the amount of credit used and the expectation of future potential value that may be used in
accordance with the agreement.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a longer
period. The maximum contractual period shall be considered as the period up to the date on which the Group has the
right to require payment or end the commitment or guarantee.
The Group adopted as a residual term criterion for renewable operations, when in stage 2, a term of 5 years. This term
was determined based on the behavioural models of this type of product applied by the Bank in the liquidity risk and
interest rate (ALM) analysis. According to these models, the maximum period of repayment of these operations is the 5
years considered conservatively in the scope of the calculation of credit impairment.
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-looking
information is carried out in the relevant elements considered for the calculation of expected credit losses (ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing exposures
at the reference date becoming defaulted exposures considers the expected values for a set of macroeconomic
variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the Bank's Economic Studies
area. These scenarios, which are used across the Bank for various purposes besides calculating impairment, consider
existing projections by reference entities.
In December 2022 the Bank carried out an update of the macroeconomic scenarios and of the corresponded adjustment
of the parameters considered in the collective impairment model.
C2.Financial liabilities
C2.1.Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013\u201cFinancial liabilities at amortised cost\u201d;
\u2013\u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1.Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a)\u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that form
part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a
recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as hedging
instrument).
b)\u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in market
conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with the costs or
income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of
that liability shall be presented in other comprehensive income;
\u2013the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest expense and similar
charges\" based on the effective interest rate of each transaction.
C2.1.2.Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial guarantee
contracts are subsequently measured at the highest of the following amounts:
\u2013the provision for losses determined according to the criteria described in note C1.5;
\u2013the amount initially recognised deducted, when appropriate, from the accumulated amount of income recognised
according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial assets at amortised cost\" includes resources from credit institutions and from customers, as
well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in \"Interest expense and
similar charges\", based on the effective interest rate method.
C2.2.Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3.Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.
C3.Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
C4.Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance with IAS
39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and foreign
exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge accounting
are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in accordance
with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013at the inception of the hedge there is formal documentation of the hedge;
\u2013the hedge is expected to be highly effective;
\u2013the effectiveness of the hedge can be reliably measured;
\u2013the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to variations in
cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets or
liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised through
profit and loss, as well as changes in currency risk of the monetary items.
C4.1.Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are recognised
in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or liability or
group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge accounting, the
cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised until the
discontinuance of the hedge accounting are amortised through profit and loss over the residual term of the hedged
item.
C4.2.Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify as
cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge relations. Any
gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will affect
profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the hedging
relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked, the hedge
relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative accumulated in
equity until the date of the discontinued hedge accounting can be:
\u2013deferred over the residual period of the hedged instrument; or,
\u2013recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised in
equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income statement.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is
immediately transferred to profit and loss.
C4.3.Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such, the
Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective tests in
order to demonstrate at each reporting period the effectiveness of the hedging relationships, demonstrating that the
variations in fair value of the hedging instrument are hedged by the fair value variations of the hedged item in the
portion assigned to the risk covered. Any ineffectiveness is recognised immediately in profit and loss when incurred.
C4.4.Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange gain or
loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The gain or loss
relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses accumulated in equity
related to the investment in a foreign operation and to the associated hedge operation are recognised in equity and
transferred to profit and loss, on the disposal of the foreign operation as part of the gain or loss from the disposal.
C5.Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and benefits of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.Securitization operations
D1.Traditional securitizations
As at 31 December 2022, BCP has three residential mortgage credit securitization operations (Magellan Mortgages no.1,
no.3 and no.4), portfolios which were derecognised from the Bank\u2019s individual balance sheet, as the residual portions
of the referred operations were sold to institutional investors and, consequently, their risks and benefits were
substantially transferred.
By purchasing a part of the most subordinated residual portion, the Group maintained control of the assets and
liabilities of Magellan Mortgages no.3, with this Special Purpose Entity (SPE) being consolidated in the Group\u2019s financial
statements, in accordance with the accounting policy referred to in note 1 B.
The three operations are traditional securitizations, where each mortgage loan portfolio was sold to a Portuguese Loan
Titularization Fund, which has financed this purchase through the sale of titularization units to a SPE with office in
Ireland. At the same time, this SPE issued and sold in capital markets a group of different portions of bonds.
D2.Synthetic securitizations
As at 31 December 2022, BCP has three synthetic securitization operations, with similar characteristics, with reference
to credit portfolios granted by the Bank mainly to Small and Medium Enterprises (SMEs).
Caravela SME no.3, which started on 28 June 2013, has a medium and long-term loan portfolio of current accounts and
authorized overdrafts.
Caravela SME no.4, initiated on 5 June 2014, has a reference portfolio of vehicle, real estate and equipment leasing.
Caravela SME no.5, initiated on 20 December 2022, is supported on a credit portfolio of medium and long term loans,
leasing contracts and commercial paper programmes.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitizations, under CDS, the risk
of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity.
In the case of both Caravela no. 3 and no. 4, the mezzanine and part of the equity (20%) were placed in the market
through the issuance of Credit Linked Notes (CLNs) by the above mentioned SPE which were subscribed by investors,
while the Group retained the senior risk and the remaining part of the equity (80%). In the case of Caravela, SME no. 5,
only the full amount of the mezzanine was placed in the market, while the Group retained the risk of the full amount
of the senior and equity tranches.
Note that in all the above-mentioned synthetic transactions, the product of the CLNs issue was invested by the SPE in a
deposit, which fully collateralizes the responsibilities in the presence of its creditors including BCP in accordance with
the CDS.
In March 2022, the Group's subsidiary Bank Millennium concluded a synthetic securitization transaction with the
participation of European Investment Bank (EIB) and European Investment Fund (EIF). The portfolio covered by the
transaction concerned receivables from small and medium-sized enterprises (SME).\u00a0 Bank Millennium obtained the EIF
guarantee for the senior tranche and the junior tranche, which is unfunded credit protection within the meaning of the
CRR. The selected loan portfolio covered by the securitization remained in the Bank Millennium''s balance sheet.
On 23 December 2022, Bank Millennium settled another synthetic securitisation transaction executed on a portfolio of
corporate and SME receivables. The selected loan portfolio securitised remained on the bank's balance sheet. The risk
transfer was affected by a recognised credit protection instrument in the form of Credit Linked Notes (CLNs).
The transaction meets the requirements for the transfer of a material part of the risk, set out in the CRR Regulation
(Regulation of the European Parliament and of the Council No. 575/2013 of 26 June 2013 on prudential requirements
for credit institutions and investment firms).
E.Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to deliver
cash or another financial asset to another entity or to exchange financial assets or financial liabilities with another
entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may be settled in
the issuer's own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to
deliver a variable number of its own equity instruments or a derivative that will be settled only by the issuer
exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity after
deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to the
amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised in equity,
net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is solely
at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are deducted
to equity.
F.Securities borrowing and repurchase agreement transactions
F1.Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are measured
in accordance with the applicable accounting policy. Cash collateral received in respect of securities lent is recognised
as a financial liability. Securities borrowed under securities borrowing agreements are not recognised. Cash collateral
placements in respect of securities borrowed are recognised under loans and advances to either banks or customers.
Income and expenses arising from the securities borrowing and lending business are recognised on an accrual basis over
the period of the transactions and are included in interest income or expense (net interest income).
F2.Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities substantially
equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to reselling
agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in loans and
advances to customers or loans and advances to credit institutions. The receivables are collateralised by the related
securities. Securities sold through repurchase agreements continue to be recognised in the balance sheet and are
revaluated in accordance with the applicable accounting policy. The amounts received from the proceeds of these
securities are considered as deposits from customers and deposits from credit institutions. The difference between the
acquisition/sale and reselling/repurchase conditions is recognised on an accrual basis over the period of the transaction
and is included in interest income or expenses.
G.Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of leases:
\u2013from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which results
in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the lease term
ends within 12 months or for those which the underlying asset is of low-value and, in these cases, the lessee may
opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments associated with these
leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below Euros 5,000. Additionally, this
standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or contains a
lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all the
economic benefits of using it, and the right to choose how to use the identified asset over a period in exchange of a
payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability plus
the value of payments made (fixed and/or variable), deducted from any lease incentives received, penalties for
terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the lessee with the
dismantling and removal of the underlying asset and/or with the recovery of its location. Subsequently, it will be
measured according to the cost model (subject to depreciations/amortisations and impairment tests);
\u2013a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013fixed payments deducted from any lease incentives receivable;
\u2013variable lease payments that depend on a rate or an index, initially measured considering the rate or index as at
the commencement date;
\u2013amounts expected to be paid by the lessee under residual values guarantees;
\u2013the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to end
the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate curve
(swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract. For term
contracts, that date is considered as the end of lease date, while for contracts without term, or with renewable terms,
it is assessed using the date in which the contract is enforceable, as well as eventual economic penalties associated
with the lease contract. In the evaluation of enforceability, the particular clauses of the contracts are considered, as
well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013by increasing their carrying amount to reflect interest;
\u2013by reducing their carrying amount to reflect lease payments;
\u2013carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the review
of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset) whenever:
\u2013the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate;
\u2013the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed
residual value, in which cases the liability is remeasured by discounting the revised lease payments using the initial
discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a
revised discount rate is used;
\u2013a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the
lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If the
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to
exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset.
The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013in the consolidated income statement:
(i)recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii)recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii)recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013.in the consolidated balance sheet:
(i)recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of financial
assets related to sublease operations measured accordingly to IFRS 9;
(ii)recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii)recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013 Payments
(cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to lease contracts of
low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in other sundry liabilities
and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019 capital portions, as detailed
in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of an
underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards
inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary, and
the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the underlying
asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
Impact of the pandemic caused by COVID-19 virus
On 12 October 2020, the European Union published an amendment to IFRS 16, associated with income concessions
related to COVID-19. This amendment allows tenants, as a practical expedient, to have the possibility to choose not to
consider a rent concession that occurs as a direct consequence of the COVID-19 pandemic as a modification of the
lease. A lessee who uses this option must account for any concession that occurs at the rent level in the same way that
he would do it under IFRS 16 \u2013 Leases, if this change did not constitute a modification of the lease. This amendment
does not affect lessors.
Within the scope of the sublease, the Group carried out the analysis of the respective contracts.
I.Recognition of income from services and commissions
In accordance with IFRS 15, the Bank recognizes revenue associated with services and commissions when (or as) a
performance obligation is satisfied when transferring a service, based on the transaction price associated with this
performance obligation. In this context, the Bank takes the following steps to recognize revenue associated with
services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the service
provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations associated with
each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also considering the
contractual terms established with the counterparty. According to this definition, a service is transferred when the
customer obtains the benefits and control associated with the service provided. In this context, the Bank also identifies
whether performance obligations are met over time (\u201cover time\u201d) or at an exact moment (\u201cpoint in time\u201d), with
revenue being recognized accordingly.
- Measurement (price to be recognized associated with each performance obligation): (i) determine the transaction
price associated with the service provided, considering the contractual terms established with the counterparty and its
usual commercial practices. The transaction price is the amount of consideration to which the Bank expects to be
entitled in exchange for transferring promised services to the customer, excluding amounts collected on behalf of third
parties. The Bank includes in the transaction price part or all of the estimated amount of the variable consideration
associated with a performance obligation, only to the extent that it is highly probable that a significant reversal in the
amount of the accrued revenue recognized will not occur when the uncertainty associated with that variable
consideration is subsequently resolved; and (ii) allocate the transaction price to each of the performance obligations
identified under the contract established with the customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a financial
instrument, income resulting from services and commissions is recorded in net interest income (Note C.3).
J.Gains/(losses) on financial operations at fair value through profit or loss, Foreign exchange
gains/(losses), Hedge accounting gains/(losses), Gains/(losses) from derecognition of assets
and liabilities at amortised cost and Gains/(losses) from derecognition of financial assets at
fair value through other comprehensive income
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e., fair
value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding dividends
received. This balance also includes the gains and losses on sale of financial assets at fair value through other
comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair value of
hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this balance, as well
as the foreign exchange gains or losses.
K.Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements. Fees
and commissions arising from this activity are recognised in the income statement in the period in which they occur.
L.Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses. Subsequent
costs are recognised as a separate asset only when it is probable that future economic benefits will result for the
Group. All other repairs and maintenance expenses are charged to the income statement during the financial period in
which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
for their death, in accordance with the terms of the two collective labour agreements approved. These benefits are
provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no. 54/2009, all
employees were covered by the provisions of the social security chapter of the ACT, and for employees who were
already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July 2009, in
accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements to
the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto de
Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January 2012. The
plan was cut, and employees were given individual acquired rights. On that date, the Group also proceeded to the
settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now covers their
maternity, paternity, adoption and pension benefits. However, the banks remain liable for benefits that concern
illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the employee,
replacing the Banking Social Healthcare System which was extinguished by the decree law referred above. As a
consequence of this amendment the capability to receive pensions by the actual employees are covered by the General
Social Security Scheme regime, considering the service period between 1 January 2011 and the retirement age. The
banks support the remaining difference for the total pension assured in the Collective Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to be
borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit during the
average lifetime of the pension until the normal retirement age is reached. The calculation of the liability for pensions
carried out periodically by the actuary considers this effect and is calculated considering the actuarial assumptions in
force, ensuring that the liabilities calculated with reference to 31 December 2010, not considering the effect of the
integration of bank employees into the General Social Security Scheme are fully covered and deducted from the amount
of the effect recognised until the date. The component of this effect for the year is recognised under the heading
\"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December, an
agreement was established between the Government, the Portuguese Banking Association and the Banking Labour
Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to pensioners
and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of Collective
Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in pensions as well as any
other complements, namely, contributions to the Health System (SAMS), death benefit and death before retirement
benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the two
union federations of the unions that represent the Group's employees, which introduced changes in the Social Security
clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new ACT was published by
the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and the effects were recorded in
the financial statements of 31 December 2016, for employees associated with these four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the new
ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the effects of
this new ACT recorded in the financial statements as at 31 December 2017, for employees associates of SBN.
The most relevant changes in the ACT were the change in the retirement age (presumed disability) from 65 years to 66
years and two months in 2016 and the subsequent update of an additional month in each year, which cannot, in any
case, be higher than the one in force at any moment in the General Regime of Social Security, the change in the
formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new benefit called the
End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had an
impact on the present value of the liabilities with services rendered and were recognised in the income statement for
the year under \"Staff costs\".
In 2017, after the authorization of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF - Portuguese
Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was amended. The main
purpose of the process was to incorporate into the pension fund the changes introduced in the Group's ACT in terms of
retirement benefits, as well as to transfer to the pension fund the responsibilities that were directly chargeable to the
company (extra-fund liabilities). The pension fund has a part exclusively for the financing of these liabilities which, in
the scope of the fund, is called Additional Complement. The End of Career Premium also became the responsibility of
the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year basis
on 31 December and 30 June of each year, and whenever there are significant market fluctuations or significant
specific events, such as changes in the plan, curtailments or settlements since the last estimation. The responsibilities
with past service are calculated using the Projected Unit Credit method and actuarial assumptions considered
adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately for
each plan by estimating the amount of future benefit that employees have earned in return for their service in the
current and prior periods. The benefit is discounted to determine its present value, using a discount rate determined by
reference to interest rates of high- quality corporate bonds that have maturity dates approximating the terms of the
Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of the Pension Plan's
assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability with
retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the determination of
the retirement pension liabilities. On this basis, the income/cost net of interest includes the interest costs associated
with retirement pension liabilities and the expected return of the plan's assets, both measured based on the discount
rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences between
actuarial assumptions used and the amounts actually observed (experienced gains and losses) and changes in actuarial
assumptions and (ii) gains and losses arising from the difference between the expected return of the plan's assets and
the amounts obtained, are recognised against equity under \"Other comprehensive income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii) the
income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and, (v)
the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension plan is
recognised as interest and similar income or interest expense and similar costs depending on their nature. The costs of
early retirements correspond to the increase in liabilities due to the employee's retirement before reaching the age of
retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the spouse
and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific contribution
plan that ensures the solvency of the fund. In the end of each year, according to Bank of Portugal Notice no. 12/2001,
the minimum level required for the responsibilities funding must be 100% regarding pension payments and 95%
regarding past services of active employees.
R2.Revision of the salary tables for employees in service and pensions in payment
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates took
effect on 1 January 2021, except for compensation for subsistence and travel allowances, which were updated after the
agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions Mais Sindicato do Sector Financeiro, SBC \u2013 Sindicato Banc\u00e1rios do Centro and SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal, the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates took effect on 1 January 2022,\u00a0 except for compensation for subsistence
and travel allowances, which were updated after the agreed updates are operational.
Regarding SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios and SIB \u2013 Sindicato Independente da Banca, an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing.
R3.Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees are
recognised as expenses when incurred.
As at 31 December 2022, the Group has two defined contribution plans. One plan covers employees who were hired
before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and equal to 1%
of the annual remuneration paid to employees in the previous year. Contributions shall only be made if the following
requirements are met: (i) the Bank's ROE equals or exceeds the rate of government bonds of 10 years plus 5 percentage
points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the current
month, either by themselves or by the Group and employees. This contribution has a mandatory character and is
defined in the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4.Variable remuneration paid to employees
The remuneration policy for employees includes an annual variable remuneration system for employees not covered by
commercial incentive systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and of the annual fixed
remuneration of reference for the role performed, and provided that the Bank's minimum level of performance, as
measured by a set of quantitative indicators, is met, the amount of the variable remuneration to be attributed to each
employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the respective
allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to employees is
recorded against the income statement in the period to which it relates.
R5.Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets approved
by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred taxes relating
to tax losses and to temporary differences between the accounting net income and the net income accepted by the Tax
Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable probability that these taxes
will be paid or recovered in the future.
Income tax registered in net income for the year comprises current and deferred tax effects. Income tax is recognised
in the income statement, except when related to items recognised directly in equity, which implies its recognition in
equity. Deferred taxes arising from the revaluation of financial assets at fair value through other comprehensive income
and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are recognised after in the income
statement at the moment the profit and loss that originated the deferred taxes are recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for tax
purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor taxable
profit and differences relating to investments in subsidiaries to the extent that probably they will not reverse in the
foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairments not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairments will be deductible
for the purposes of determining taxable income for the tax periods in which the legal conditions required for their tax
deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if: (i)
it has a legally enforceable right to offset current tax assets and current tax liabilities; and, (ii) the deferred tax assets
and the deferred tax liabilities relate to income taxes released by the same Tax Authority on either the same taxable
entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred any material impact on the Bank\u2019s financial statements
resulting from its application.
In 2016, the Bank adhered to the Special Tax Regime for Groups of Companies (RETGS) for the purposes of IRC taxation,
with BCP being the dominant entity. In the financial years of 2022 and 2021, RETGS application was maintained. In
2021, Millennium bcp Participa\u00e7\u00f5es Sociais \u2013 Sociedade Unipessoal, Lda. and BCP \u00c1frica, SGPS, Lda., were included in
the group of companies covered by this regime, being now covered by the general IRC regime. The group's taxable
profit is calculated by the algebraic sum of taxable profits and individual tax losses of the companies that integrate it.
T.Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by operating and
geographic segments. A business segment is a Group's component: (i) which develops business activities that can obtain
revenues or expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking
decisions about allocating resources to the segment and assess its performance; and, (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013Retail Banking, also including ActivoBank;
\u2013Companies, Corporate and Investment Banking;
\u2013Private Banking;
\u2013Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralized management of financial investments, corporate activities, and insurance activity.
Foreign activity:
\u2013Poland;
\u2013Mozambique;
\u2013Other.
The \"Other\" segment (foreign activity) includes the activity arising from the discontinued operations in Switzerland and
Cayman Islands (operation liquidated in 2022) and also the contribution of the participation in an associate in Angola. It
should be noted that, following the sale of the operation in Switzerland on 2 November 2021, the subsidiary's net
income in December 2021and the capital gain generated with the sale of the entire shareholding in Banque Priv\u00e9e BCP
(as well as the adjustments occurred in 2022), are reflected as income arising from discontinued operations, as
provided for in IFRS 5.
U.Provisions, Contingent liabilities and Contingent assets
U1.Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and, (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganizations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognized for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected cost,
the most likely result of current actions and considering the risks and uncertainties inherent to the process result. On
the cases that the discount effect is material, provision corresponds to the actual value of the expected future
payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted through
profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the case
that these obligations cease to exist.
U2.Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow of
resources is probable.
U3.Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the possibility
of an outflow of resources regarding economic benefits is not remote. The Group registers a contingent liability when:
i)it is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non- occurrence of one or more uncertain future events that are not wholly within the control of the Group; or,
ii)it is a present obligation that arises from past events but is not recognised because:
a)it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b)the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
V.Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares purchased
by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to consider
conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as dilutive when
their conversion to shares would decrease net earnings per share. If the earnings per share are changed because of an
issue with premium or discount or other event that changed the potential number of ordinary shares or because of
changes in the accounting policies, the earnings per share for all presented periods should be adjusted retrospectively.
W.Insurance contracts
W1.Classification
The Group issues contracts that contain insurance risk, financial risk or a combination of both insurance and financial
risk. A contract, under which the Group accepts significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in accordance with
the accounting policies applicable to insurance contracts. A contract issued by the Group that transfers only financial
risk, without discretionary participating features, is accounted for as a financial instrument.
W2.Recognition and measurement
Premiums of life insurance and investment contracts with discretionary participating features, which are considered as
long-term contracts are recognised as income when due from the policyholders. The benefits and other costs are
recognised concurrently with the recognition of income over the life of the contracts. This specialization is achieved
through the establishment of provisions/liabilities of insurance contracts and investment contracts with discretionary
participating features.
The responsibilities correspond to the present value of future benefits payable, net of administrative expenses directly
associated with the contracts, less the theoretical premiums that would be required to comply with the established
benefits and related expenses. The liabilities are determined based on assumptions of mortality, costs of management
or investment at the valuation date.
For contracts where the payment period is significantly shorter than the period of benefit, premiums are deferred and
recognised as income in proportion to the duration period of risk coverage. Regarding short-term contracts, including
contracts of non-life insurance, premiums are recorded at the time of issue. The award is recognised as income
acquired on a pro-rata basis during the term of the contract. The provision for unearned premiums represents the
amount of issued premiums on risks not occurred.
W3.Premiums
Issued gross premiums are recognised for as income in the period to which they respect independently from the
moment of payment or receivable, in accordance with the accrual accounting principle. Reinsurance premiums ceded
are accounted for as expense in the period to which they respect in the same way as gross premiums written.
W4.Provision for unearned premiums from direct insurance and reinsurance premiums ceded
The provision for unearned gross premiums is based on the evaluation of the premiums written before the end of the
year but for which the risk period continues after the year end. This provision is calculated using the pro-rata temporis
method applied to each contract in force.
W5.Liability adequacy test
At each reporting date, the Group evaluates the adequacy of liabilities arising from insurance contracts and investment
contracts with discretionary participating features. The evaluation of the adequacy of responsibilities is made based on
the projection of future cash flows associated with each contract, discounted at market interest rate without risk. This
evaluation is done product by product or aggregate of products when the risks are similar or managed jointly. Any
deficiency, if exists, is recorded in the Group's results as determined.
X.Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorized by Autoridade de Supervis\u00e3o de Seguros e
Fundos de Pens\u00f5es (ASF) for the practice of insurance intermediation in the category of Linked Insurance Broker, in
accordance with Article 8, paragraph a), subparagraph i) of Decree-Law no. 144/2006, of 31 July, carrying out
insurance intermediation activities in life and non-life segments.
Within the scope of insurance intermediation services, these banks perform the sale of insurance contracts. As
compensation for insurance intermediation services, they receive commissions for arranging insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurance Companies.
Commissions received for insurance intermediation are recognised in accordance with the accrual accounting principle,
so the commissions whose receipt occurs at a different time from the period to which they refer are recognised as an
amount receivable under the item \"Other assets\". Commissions received for insurance mediation services are recognized
in accordance with the policy described in note I. Recognition of income from services and commissions.
Y.Accounting estimates and judgments in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgments and to make estimations when deciding which treatment is the most appropriate.
These estimates were made considering the best information available at the date of preparation of the consolidated
financial statements, considering the context of uncertainty that results from the current economic scope. The most
significant of these accounting estimates and judgments used when applying accounting principles are discussed in this
section to improve understanding of how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different treatment
was chosen. The Executive Committee believes that the choices made are appropriate and that the financial
statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1.Entities included in the consolidation perimeter
For the purposes of determining entities to include in the consolidation perimeter, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession of
these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by the
Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is exposed to
the variable returns and its ability to use its power to affect these returns. Different estimations and assumptions could
lead the Group to a different scope of consolidation perimeter with a direct impact in consolidated income.
Y2.Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax determination
is uncertain during the ordinary course of business. Different interpretations and estimations could result in a different
level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in which
the Group considers projections of future taxable income based on a set of assumptions, including the estimate of
income before tax, adjustments to taxable income, evolution of tax legislation and its interpretation. Thus, the
recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors strategy, namely
the ability to generate the estimated taxable income, the evolution of tax law and its interpretation.
Regarding the activity in Portugal, Regulatory Decrees no. 5/2016, of 18 November, no. 11/2017, of 28 December, and
no. of impairment losses and other value corrections for specific credit risk deductible for the purposes of calculating
taxable income based on IRC in the years 2016, 2017 and 2018, respectively. These Regulatory Decrees establish that
Bank of Portugal Notice No. 3/95 (Notice that was relevant for the determination of loan provisions in the financial
statements presented in NCA) must be considered for the purposes of calculating the maximum limits of impairment
losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
Law No. 98/2019, of September 4, established the tax regime for credit impairments and provisions for guarantees for
tax periods beginning on or after January 1, 2019, providing for approximation between accounting rules and tax for
the purposes of deductibility of expenses with the strengthening of credit impairments. The rules in force until 2018
could continue to be applied until the end of the 2023 financial year, unless the option to apply the new regime was
exercised in advance.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, the Bank exercised the option to apply the new regime, under the terms of which the impairment
losses for credit risk relating to exposures analysed on an individual basis or on a collective basis recognized in
accordance with applicable accounting standards and regulations, maintaining the rules in force until 2018 for the
balance of impairment losses and other value adjustments for specific credit risk recorded up to 31 December 2021.
Following the amendments provided for in Law No. 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This amendment
applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax losses calculated in
tax periods prior to January 1, 2023 and whose deduction period is still in progress on that date. Thus, tax losses
calculated in 2014 and subsequent years may be deducted from future taxable income. The deduction limit for tax
losses increased from 70% to 65%, being increased by ten percentage points when the difference results from the
deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of the special regime provided for
in Law n. 27-A/2020, of 24 July 24.
In the projections of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2022, the approximation between the accounting and tax rules
provided for in the aforementioned Law n.\u00ba 98/2019 was considered, of 4 September, taking into account the option for
applying the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the
use of tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any deduction or tax credit being
used, in which the expiry period is the exercise of that right. The Bank recorded provisions or liabilities for deferred
taxes in the amount it considers appropriate to cover tax corrections or tax losses incurred, as well as contingencies
relating to years not yet reviewed by the tax authorities.
Y4.Non-current assets held for sale (real estate) valuation
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Bank's historical experience in the commercialization of real estate, its perspectives on the evolution
of the real estate market and the intentions of the management body regarding the commercialization of these assets.
The assumptions used in the valuations of these assets have an impact on their valuation and consequently on the
determination of impairment.
Y5.Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
projections, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
As defined by IAS 19, the discount rate used to update the responsibilities of the Bank's pension fund is based on an
analysis performed over the market yields regarding a bond issues universe \u2013 that the Group considers having high
quality (low risk), different maturities (appropriate to the period of liquidation of the fund's liabilities) and
denominated in euros - related to a diverse and representative range of issuers.
Y6.Financial instruments \u2013 IFRS 9
Y6.1.Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and interest
on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed together to
achieve a specific business objective. This evaluation requires judgment, since the following aspects, among others,
must be considered: the way in which the performance of assets is evaluated; the risks that affect the performance of
the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other comprehensive
income that are derecognised prior to their maturity to understand the underlying reasons for their disposal and to
determine whether they are consistent with the purpose of the business model defined for these assets. This monitoring
is part of a process of continuous evaluation by the Group of the business model of the financial assets that remain in
the portfolio, to determine if it is adequate and, if it is not, if there was a change in the business model and,
consequently, a prospective classification change of these financial assets.
Y6.2.Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
Y6.3.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7. Provisions for risk associated with mortgage loans indexed to the Swiss franc
The Group creates provisions for legal contingencies related to mortgage loans indexed to the Swiss franc granted by
Bank Millennium, S.A.
The assumptions used by the Bank are essentially based on historical observations and will have to be updated in
subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The methodology developed by
the Bank is based on the following parameters: (i) the number of current (including class actions) and potential future
court cases that will appear within a specified time horizon; (ii) the amount of the Bank\u2019s potential loss in the event of
a specific court judgment (three negative judgment scenarios were taken into account); (iii) the probability of
obtaining a specific court verdict calculated on the basis of statistics of judgments of the banking sector in Poland and
legal opinions obtained; (iv) in the case of a loan agreement invalidity scenario, the Bank Millennium's loss is calculated
taking into account the assignment of a minimum probability of receiving the settlement of a remuneration for the cost
of use of capital; and (v) amicable settlement with clients in or out of court.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the swiss franc and the
amount of the Bank\u2019s actual losses depend, namely, on the number of ongoing and potential lawsuits, as well as on the
final court decisions about each case and amicable settlement with clients.
\u00a0 \u00a0 Z. Subsequent events
The Group analyses events occurred after the balance sheet date, i.e., favourable and/or unfavourable events that
occur between the balance sheet date and the date the financial statements were authorized for issue. In this context,
two types of events can be identified:
i)those that provide evidence of conditions that existed at the balance sheet date (events after the balance sheet
date that give rise to adjustments); and,
ii)those that are indicative of the conditions that arose after the balance sheet date (events after the balance sheet
date that do not give rise to adjustments).
Events occurred after the date of the financial statements that are not considered as adjustable events, if significant,
are disclosed in the notes to the consolidated financial statements.
", "dimensions": { "concept": "ifrs-full:DisclosureOfMaterialAccountingPolicyInformationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-552": { "value": "Accounting policies
A.Basis of presentation
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the Bank
and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the years ended
on 31 December 2022 and 2021.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2022 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in Portuguese. In
the event of discrepancies, the Portuguese version prevails.
A1.Comparative information
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1 January 2022.
The accounting policies were applied consistently to all entities of the Group and are consistent with those used in the
preparation of the financial statements of the previous period.
The Group's financial statements were prepared under the going concern assumption, the accrual-based accounting
regime and under the historical cost convention, as modified by the application of fair value for derivative financial
instruments, financial assets and liabilities at fair value through profit or loss and financial assets at fair value through
other comprehensive income. Financial assets and liabilities that are covered under hedge accounting are stated at fair
value in respect of the risk that is being hedged, if applicable. Other financial assets and liabilities and non-financial
assets and liabilities are stated at amortised cost or historical cost. Non-current assets and disposal groups held for sale
are stated at the lower of carrying amount or fair value less costs to sell. The liability for defined benefit obligations is
recognised as the present value of the past liabilities with pensions net of the value of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice of
the Executive Committee, to make judgments, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and associated
assumptions are based on historical experience and other factors that are believed to be reasonable under the
circumstances and form the basis for making the judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimations. The issues involving a higher
degree of judgment or complexity or for which assumptions and estimations are significant are presented in note 1.Y.
B.Basis of consolidation
As from 1 January 2010, the Group began to apply IFRS 3 (revised) for the accounting of business combinations. The
changes in the accounting policies resulting from the application of IFRS 3 (revised) are applied prospectively.
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the Bank
and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1.Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
B2.Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3.Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
B4.Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is accounted as a
transaction with shareholders and, therefore, no additional goodwill resulting from this transaction is recognised. The
difference between the acquisition cost and the fair value of non-controlling interests acquired is recognised directly in
reserves. On this basis, the gains and losses resulting from the sale of controlling interests that do not impact the
control position of a subsidiary are always recognised against reserves.
B5.Loss of control
The gains and losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6.Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity methods,
exchange differences, between the conversion to euros of the equity at the beginning of the year and its value in euros
at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are recognised against
\u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that are designated and
qualified as hedging instruments related to foreign operations are recorded in equity under \"Reserves and retained
earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted against profit and loss of the
year.
The income and expenses of these subsidiaries are converted to euros at an approximate rate of the rates on the dates
of the transactions, using a monthly average considering the initial and final exchange rates of each month. Exchange
differences from the conversion to euros of the profits and losses for the reporting period, arising from the difference
between the exchange rate used in the income statement and the exchange rate prevailing at the balance sheet date,
are recognised in \"Reserves and retained earnings - exchange differences resulting from the consolidation of Group's
companies\". The exchange rates used by the Group are detailed in note 54.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to the
investment in the foreign operation and to the associated hedge transaction previously recognised in reserves are
transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associated companies, its effects are included in
the Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items are
recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy until 31
December 2018. This classification is no longer applicable as of 1 January 2019.
B7.Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from these
transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains and losses
arising from transactions with associates and jointly controlled entities are eliminated in the proportion of the Group's
investment in these entities.
C.Financial instruments (IFRS 9)
C1.Financial assets
C1.1.Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013\u201cFinancial assets at amortised cost\u201d;
\u2013\u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013\u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013the Group's business model for the management of the financial asset; and,
\u2013the characteristics of the contractual cash flows of the financial asset.
Business Model Evaluation
With reference to 1 January 2018, the Group carried out an evaluation of the business model in which the financial
instruments are held at portfolio level, since this approach reflects how assets are managed and how that information
is made available to management bodies. The information considered in this evaluation included:
\u2013the policies and purposes established for the portfolio and the practical operability of these policies, including how
the management strategy focuses on receiving contractual interest, maintaining a certain interest rate profile,
adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the realization
of cash flows through the sale of the assets;
\u2013how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013the evaluation of the risks that affect the performance of the business model (and of the financial assets held under
this business model) and the way these risks are managed;
\u2013the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the assets
under management or on contractual cash flows received; and,
\u2013the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the expectations
about future sales. However, sales information should not be considered individually, but as part of an overall
assessment of how the Group establishes financial asset management objectives and how cash flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured at
fair value through profit or loss because they are not held either for the collection of contractual cash flows (HTC), nor
for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial recognition.
\"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with the amount
owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk and
administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation included
the analysis of the existence of situations in which the contractual terms can modify the periodicity and the amount of
the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group considered:
\u2013contingent events that may change the periodicity and the amount of the cash flows;
\u2013characteristics that result in leverage;
\u2013terms of prepayment and extension of maturity;
\u2013terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal value;
\u2013the prepayment represents substantially the nominal amount of the contract plus accrued contractual interest, but
not paid (may include reasonable compensation for prepayment); and,
\u2013the prepaid fair value is insignificant at initial recognition.
C1.1.1.Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following conditions
are met:
\u2013the financial asset is held within a business model whose objective is to hold financial assets in order to collect their
contractual cash flows; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and advances
to customers and debt instruments managed based on a business model whose purpose is to receive their contractual
cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
C1.1.2.Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive income\"
if both of the following conditions are met:
\u2013the financial asset is held within a business model whose objective is both to collect its contractual cash flows and
to sell this financial asset; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent retribution
recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may irrevocably choose to
classify it in the category of \"Financial assets at fair value through other comprehensive income\" (FVOCI). This option is
exercised on a case-by-case basis and is only available for financial instruments that comply with the definition of
equity instruments provided in IAS 32 and cannot be used for financial instruments whose classification as an equity
instrument under the scope of the issuer is made under the exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
C1.1.3.Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2.Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management has
changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including the
ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other comprehensive income is
not allowed, nor of financial instruments designated at fair value through profit or loss.
C1.3.Modification and derecognition of financial assets
General principles
i)The Group shall derecognise a financial asset when, and only when:
\u2013the contractual rights to the cash flows from the financial asset expire; or,
\u2013it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii)The Group transfers a financial asset if, and only if, it either:
\u2013transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to
pay the cash flows to one or more recipients in an arrangement that meets the conditions presented in note iii).
iii)When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'), but
assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'), the
Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are met:
\u2013the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without material
delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents
(as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the collection date until the
date of required remittance to the eventual recipients, and interest earned on such investments is passed to the
eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and benefits arising from owning the financial asset. In this case:
\u2013if the Group transfers substantially all the risks and benefits arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013if the Group retains substantially all the risks and benefits arising from owning the financial asset, it shall continue
to recognise the financial asset;
\u2013if the Group neither transfers nor retains substantially all the risks and benefits arising from owning the financial
asset, it shall determine whether it retained control of the financial asset. In this case:
a)if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as assets or
liabilities, any rights and obligations created or retained in the transfer;
b)if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and benefits (see prior note) is evaluated by comparing the Group\u2019s exposure, before and after
the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset depends
on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in its entirety
to an unrelated third party and can exercise that ability unilaterally without needing to impose additional
restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of new
ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that may lead
to the derecognition of a financial asset.
The Bank considers that a modification of the terms and conditions of a credit exposure will result in derecognition of
the transaction and in recognition of a new transaction when the modification translates into at least one of the
following conditions:
\u2013creation of a new exposure that results from a debt consolidation, without any any of the derecognized instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to the
residual maturity in the moment of the modification;
\u2013Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or managed
within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on the
financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv of
the above paragraph should be checked (the other criteria listed in this paragraph are not relevant in such situations).
Under the regulatory changes that occurred in Poland described in note 48 and those negotiated with customers holding
mortgage loans in foreign currency described in note 57, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a given
asset is not derecognised, Bank Millennium adjusts the gross book value of the financial asset and recognises the profit
or loss due to the modification in the Income Statement - Results on modification. The adjustment to the gross carrying
amount of a financial asset is the difference between the discounted cash flows before and after contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its entirety
or partially. Loans written-off are recognised in off-balance sheet accounts.
C1.4.Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit impairment
in the moment of their initial recognition. An asset is credit-impaired if one or more events have occurred with a
negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013financial assets arising from a recovery process, where there have been changes to the terms and conditions of the
original agreement, which presented objective evidence of impairment that resulted in its derecognition (note C1.3)
and recognition of a new contract that reflects the credit losses incurred;
\u2013financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses (ECL)
are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition, the gross
book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value before being
recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5.Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2.Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the income
statement under \"Impairment of financial assets at fair value through other comprehensive income\", against other
comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3.Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are recognised in
liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other provisions\" (in the
income statement).
C1.5.2.Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
C1.5.3.Significant increase in credit risk (SICR)
Significant increase in credit risk (SICR) is determined according to a set of mostly quantitative, but also qualitative
criteria. These criteria are mainly based on the risk grades of customers, according to the Bank's Rating Master Scale,
and on its evolution, in order to detect significant increases in Probability of Default (PD), complemented by other
information regarding the customers\u2019 behaviour towards the financial system.
C1.5.4.Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than Euros 100 (retail) or more than Euros 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in which the
customer is in this situation have been counted, it is classified as default (or GR15).
The existence of a material payment delay gives rise to the default setting (GR15) of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i.Credit restructuring due to financial difficulties with loss of value;
ii.Delay after restructuring due to financial difficulties;
iii.Recurrence of restructuring due to financial difficulties;
iv.Credit with signs of impairment (or stage 3 of IFRS 9);
v.Insolvency or equivalent proceedings;
vi.Litigation;
vii.Guarantees of operations in default;
viii.Credit sales with losses;
ix.Credit fraud;
x.Unpaid credit status;
xi.Breach of covenants in a credit agreement;
xii.Spread of default in an economic group;
xiii.Cross default in BCP Group.
C1.5.5.Estimates of expected credit losses - Individual analysis
1.Customers who are in one of the following conditions are subject to individual analysis:
Customers in default
Customers in litigation or insolvency, if the total exposure of the group members in these situations exceeds
Euros 1 million
Customers integrated into groups with an exposure over Euros 5 million, if they have a risk grade 15
Groups or customers
who are not in
default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over Euros 5 million, if a group member has a risk grade 14
Groups or customers with an exposure over Euros 5 million, if a member of the group has a restructured loan
and a risk grade 13
Groups or customers with an exposure over Euros 10 million, if at least one member of the group is in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds Euros 25 million
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
6.Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery period
to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk Office as
part of the regular process of collecting information, accompanied by detailed justification of the proposed
impairment.
7.The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be a
weighted rate considering the different recovery prospects for each part of the customer's liabilities.
8.The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualized perspective, the latter when cases that, due to their specificity, have a
high degree of uncertainty regarding the expected recovery estimation are identified.
9.The macroeconomic adjustment set out in point 8 should be analysed annually and weighted according to the type
of recovery strategy associated with the exposure under analysis:
\u2013for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global way,
to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one scenario;
\u2013for Gone Concern strategies (i.e., the recovery estimation is based on the realization of the collateral), the impact
of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the projected real
estate index indicates significant changes ahead for the current valuation values.
10.It is the responsibility of the units referred to in point 5 to consider in their projection macroeconomic expectations
that may influence the recoverability of the debt.
11.For the purposes of the preceding paragraphs, the Economic Studies, Sustainability and Cryptoassets Department
shall disclose the macroeconomic data that allow the estimations to be made.
12.The decision to consider global impacts related to the going and gone concern scenarios should be made by the Risk
Committee, as proposed by the Risk Office.
13.For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be considered
casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013recovery of collateral in geographies in which the Bank has no relevant recovery experience;
\u2013recovery of debt related to geographies in which there is strong political instability;
\u2013recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013recovery of debt related to debtors for whom there is a strong negative public exposure.
14. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
15.Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 12 of the Master Scale.
16.The individual impairment analysis must be carried out at least annually. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to promote
the review of the expected impairment of this customer.
C1.5.6.Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis are grouped considering their risk characteristics
and subject to a collective impairment analysis. The Group's credit portfolio is divided by internal risk grades and
according to the following segments:
a)Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project finance,
Institutions (banks/financial institutions) and Sovereigns;
b)Segments not \u2018low default\u2019: - Retail: Mortgages; Overdrafts; Credit cards; Small and medium enterprises - Retail
(\u2018SME Retail\u2019); and Others - Corporate: Small and medium enterprises - Corporate (\u2018Large SME\u2019); and Real Estate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013financial assets with no signs of impairment at the reporting date: the present value of the difference between the
contractual cash flows and the cash flows that the Group expects to receive;
\u2013financial assets with impairment at the reporting date: the difference between the gross book value and the present
value of the estimated cash flows;
\u2013unused credit commitments: the present value of the difference between the resulting contractual cash flows if the
commitment is made and the cash flows that the Group expects to receive;
\u2013financial guarantees: the current value of the expected repayments less the amounts that the Group expects to
recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013Probability of Default \u2013 PD;
\u2013Loss Given Default \u2013 LGD; and,
\u2013Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering the
already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These models
are based on internal data including both quantitative and qualitative factors. If there is a change in the risk of the
counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated considering the
contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates the
LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models consider
the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs. In the case
of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of high relevance
in the determination of LGD.
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD values
from the counterparty's current exposure and potential changes to its current value as a result of the contractual
conditions, including amortisations and prepayments. For commitments and financial guarantees, the value of the EAD
will consider both the amount of credit used and the expectation of future potential value that may be used in
accordance with the agreement.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a longer
period. The maximum contractual period shall be considered as the period up to the date on which the Group has the
right to require payment or end the commitment or guarantee.
The Group adopted as a residual term criterion for renewable operations, when in stage 2, a term of 5 years. This term
was determined based on the behavioural models of this type of product applied by the Bank in the liquidity risk and
interest rate (ALM) analysis. According to these models, the maximum period of repayment of these operations is the 5
years considered conservatively in the scope of the calculation of credit impairment.
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-looking
information is carried out in the relevant elements considered for the calculation of expected credit losses (ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing exposures
at the reference date becoming defaulted exposures considers the expected values for a set of macroeconomic
variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the Bank's Economic Studies
area. These scenarios, which are used across the Bank for various purposes besides calculating impairment, consider
existing projections by reference entities.
In December 2022 the Bank carried out an update of the macroeconomic scenarios and of the corresponded adjustment
of the parameters considered in the collective impairment model.
C2.Financial liabilities
C2.1.Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013\u201cFinancial liabilities at amortised cost\u201d;
\u2013\u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1.Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a)\u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that form
part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a
recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as hedging
instrument).
b)\u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in market
conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with the costs or
income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of
that liability shall be presented in other comprehensive income;
\u2013the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest expense and similar
charges\" based on the effective interest rate of each transaction.
C2.1.2.Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial guarantee
contracts are subsequently measured at the highest of the following amounts:
\u2013the provision for losses determined according to the criteria described in note C1.5;
\u2013the amount initially recognised deducted, when appropriate, from the accumulated amount of income recognised
according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial assets at amortised cost\" includes resources from credit institutions and from customers, as
well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in \"Interest expense and
similar charges\", based on the effective interest rate method.
C2.2.Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3.Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.
C3.Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
C4.Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance with IAS
39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and foreign
exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge accounting
are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in accordance
with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013at the inception of the hedge there is formal documentation of the hedge;
\u2013the hedge is expected to be highly effective;
\u2013the effectiveness of the hedge can be reliably measured;
\u2013the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to variations in
cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets or
liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised through
profit and loss, as well as changes in currency risk of the monetary items.
C4.1.Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are recognised
in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or liability or
group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge accounting, the
cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised until the
discontinuance of the hedge accounting are amortised through profit and loss over the residual term of the hedged
item.
C4.2.Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify as
cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge relations. Any
gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will affect
profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the hedging
relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked, the hedge
relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative accumulated in
equity until the date of the discontinued hedge accounting can be:
\u2013deferred over the residual period of the hedged instrument; or,
\u2013recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised in
equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income statement.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is
immediately transferred to profit and loss.
C4.3.Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such, the
Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective tests in
order to demonstrate at each reporting period the effectiveness of the hedging relationships, demonstrating that the
variations in fair value of the hedging instrument are hedged by the fair value variations of the hedged item in the
portion assigned to the risk covered. Any ineffectiveness is recognised immediately in profit and loss when incurred.
C4.4.Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange gain or
loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The gain or loss
relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses accumulated in equity
related to the investment in a foreign operation and to the associated hedge operation are recognised in equity and
transferred to profit and loss, on the disposal of the foreign operation as part of the gain or loss from the disposal.
C5.Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and benefits of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.Securitization operations
D1.Traditional securitizations
As at 31 December 2022, BCP has three residential mortgage credit securitization operations (Magellan Mortgages no.1,
no.3 and no.4), portfolios which were derecognised from the Bank\u2019s individual balance sheet, as the residual portions
of the referred operations were sold to institutional investors and, consequently, their risks and benefits were
substantially transferred.
By purchasing a part of the most subordinated residual portion, the Group maintained control of the assets and
liabilities of Magellan Mortgages no.3, with this Special Purpose Entity (SPE) being consolidated in the Group\u2019s financial
statements, in accordance with the accounting policy referred to in note 1 B.
The three operations are traditional securitizations, where each mortgage loan portfolio was sold to a Portuguese Loan
Titularization Fund, which has financed this purchase through the sale of titularization units to a SPE with office in
Ireland. At the same time, this SPE issued and sold in capital markets a group of different portions of bonds.
D2.Synthetic securitizations
As at 31 December 2022, BCP has three synthetic securitization operations, with similar characteristics, with reference
to credit portfolios granted by the Bank mainly to Small and Medium Enterprises (SMEs).
Caravela SME no.3, which started on 28 June 2013, has a medium and long-term loan portfolio of current accounts and
authorized overdrafts.
Caravela SME no.4, initiated on 5 June 2014, has a reference portfolio of vehicle, real estate and equipment leasing.
Caravela SME no.5, initiated on 20 December 2022, is supported on a credit portfolio of medium and long term loans,
leasing contracts and commercial paper programmes.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitizations, under CDS, the risk
of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity.
In the case of both Caravela no. 3 and no. 4, the mezzanine and part of the equity (20%) were placed in the market
through the issuance of Credit Linked Notes (CLNs) by the above mentioned SPE which were subscribed by investors,
while the Group retained the senior risk and the remaining part of the equity (80%). In the case of Caravela, SME no. 5,
only the full amount of the mezzanine was placed in the market, while the Group retained the risk of the full amount
of the senior and equity tranches.
Note that in all the above-mentioned synthetic transactions, the product of the CLNs issue was invested by the SPE in a
deposit, which fully collateralizes the responsibilities in the presence of its creditors including BCP in accordance with
the CDS.
In March 2022, the Group's subsidiary Bank Millennium concluded a synthetic securitization transaction with the
participation of European Investment Bank (EIB) and European Investment Fund (EIF). The portfolio covered by the
transaction concerned receivables from small and medium-sized enterprises (SME).\u00a0 Bank Millennium obtained the EIF
guarantee for the senior tranche and the junior tranche, which is unfunded credit protection within the meaning of the
CRR. The selected loan portfolio covered by the securitization remained in the Bank Millennium''s balance sheet.
On 23 December 2022, Bank Millennium settled another synthetic securitisation transaction executed on a portfolio of
corporate and SME receivables. The selected loan portfolio securitised remained on the bank's balance sheet. The risk
transfer was affected by a recognised credit protection instrument in the form of Credit Linked Notes (CLNs).
The transaction meets the requirements for the transfer of a material part of the risk, set out in the CRR Regulation
(Regulation of the European Parliament and of the Council No. 575/2013 of 26 June 2013 on prudential requirements
for credit institutions and investment firms).
E.Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to deliver
cash or another financial asset to another entity or to exchange financial assets or financial liabilities with another
entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may be settled in
the issuer's own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to
deliver a variable number of its own equity instruments or a derivative that will be settled only by the issuer
exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity after
deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to the
amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised in equity,
net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is solely
at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are deducted
to equity.
F.Securities borrowing and repurchase agreement transactions
F1.Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are measured
in accordance with the applicable accounting policy. Cash collateral received in respect of securities lent is recognised
as a financial liability. Securities borrowed under securities borrowing agreements are not recognised. Cash collateral
placements in respect of securities borrowed are recognised under loans and advances to either banks or customers.
Income and expenses arising from the securities borrowing and lending business are recognised on an accrual basis over
the period of the transactions and are included in interest income or expense (net interest income).
F2.Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities substantially
equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to reselling
agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in loans and
advances to customers or loans and advances to credit institutions. The receivables are collateralised by the related
securities. Securities sold through repurchase agreements continue to be recognised in the balance sheet and are
revaluated in accordance with the applicable accounting policy. The amounts received from the proceeds of these
securities are considered as deposits from customers and deposits from credit institutions. The difference between the
acquisition/sale and reselling/repurchase conditions is recognised on an accrual basis over the period of the transaction
and is included in interest income or expenses.
G.Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of leases:
\u2013from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which results
in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the lease term
ends within 12 months or for those which the underlying asset is of low-value and, in these cases, the lessee may
opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments associated with these
leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below Euros 5,000. Additionally, this
standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or contains a
lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all the
economic benefits of using it, and the right to choose how to use the identified asset over a period in exchange of a
payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability plus
the value of payments made (fixed and/or variable), deducted from any lease incentives received, penalties for
terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the lessee with the
dismantling and removal of the underlying asset and/or with the recovery of its location. Subsequently, it will be
measured according to the cost model (subject to depreciations/amortisations and impairment tests);
\u2013a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013fixed payments deducted from any lease incentives receivable;
\u2013variable lease payments that depend on a rate or an index, initially measured considering the rate or index as at
the commencement date;
\u2013amounts expected to be paid by the lessee under residual values guarantees;
\u2013the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to end
the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate curve
(swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract. For term
contracts, that date is considered as the end of lease date, while for contracts without term, or with renewable terms,
it is assessed using the date in which the contract is enforceable, as well as eventual economic penalties associated
with the lease contract. In the evaluation of enforceability, the particular clauses of the contracts are considered, as
well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013by increasing their carrying amount to reflect interest;
\u2013by reducing their carrying amount to reflect lease payments;
\u2013carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the review
of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset) whenever:
\u2013the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate;
\u2013the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed
residual value, in which cases the liability is remeasured by discounting the revised lease payments using the initial
discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a
revised discount rate is used;
\u2013a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the
lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If the
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to
exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset.
The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013in the consolidated income statement:
(i)recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii)recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii)recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013.in the consolidated balance sheet:
(i)recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of financial
assets related to sublease operations measured accordingly to IFRS 9;
(ii)recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii)recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013 Payments
(cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to lease contracts of
low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in other sundry liabilities
and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019 capital portions, as detailed
in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of an
underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards
inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary, and
the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the underlying
asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
Impact of the pandemic caused by COVID-19 virus
On 12 October 2020, the European Union published an amendment to IFRS 16, associated with income concessions
related to COVID-19. This amendment allows tenants, as a practical expedient, to have the possibility to choose not to
consider a rent concession that occurs as a direct consequence of the COVID-19 pandemic as a modification of the
lease. A lessee who uses this option must account for any concession that occurs at the rent level in the same way that
he would do it under IFRS 16 \u2013 Leases, if this change did not constitute a modification of the lease. This amendment
does not affect lessors.
Within the scope of the sublease, the Group carried out the analysis of the respective contracts.
I.Recognition of income from services and commissions
In accordance with IFRS 15, the Bank recognizes revenue associated with services and commissions when (or as) a
performance obligation is satisfied when transferring a service, based on the transaction price associated with this
performance obligation. In this context, the Bank takes the following steps to recognize revenue associated with
services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the service
provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations associated with
each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also considering the
contractual terms established with the counterparty. According to this definition, a service is transferred when the
customer obtains the benefits and control associated with the service provided. In this context, the Bank also identifies
whether performance obligations are met over time (\u201cover time\u201d) or at an exact moment (\u201cpoint in time\u201d), with
revenue being recognized accordingly.
- Measurement (price to be recognized associated with each performance obligation): (i) determine the transaction
price associated with the service provided, considering the contractual terms established with the counterparty and its
usual commercial practices. The transaction price is the amount of consideration to which the Bank expects to be
entitled in exchange for transferring promised services to the customer, excluding amounts collected on behalf of third
parties. The Bank includes in the transaction price part or all of the estimated amount of the variable consideration
associated with a performance obligation, only to the extent that it is highly probable that a significant reversal in the
amount of the accrued revenue recognized will not occur when the uncertainty associated with that variable
consideration is subsequently resolved; and (ii) allocate the transaction price to each of the performance obligations
identified under the contract established with the customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a financial
instrument, income resulting from services and commissions is recorded in net interest income (Note C.3).
J.Gains/(losses) on financial operations at fair value through profit or loss, Foreign exchange
gains/(losses), Hedge accounting gains/(losses), Gains/(losses) from derecognition of assets
and liabilities at amortised cost and Gains/(losses) from derecognition of financial assets at
fair value through other comprehensive income
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e., fair
value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding dividends
received. This balance also includes the gains and losses on sale of financial assets at fair value through other
comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair value of
hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this balance, as well
as the foreign exchange gains or losses.
K.Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements. Fees
and commissions arising from this activity are recognised in the income statement in the period in which they occur.
L.Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses. Subsequent
costs are recognised as a separate asset only when it is probable that future economic benefits will result for the
Group. All other repairs and maintenance expenses are charged to the income statement during the financial period in
which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
for their death, in accordance with the terms of the two collective labour agreements approved. These benefits are
provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no. 54/2009, all
employees were covered by the provisions of the social security chapter of the ACT, and for employees who were
already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July 2009, in
accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements to
the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto de
Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January 2012. The
plan was cut, and employees were given individual acquired rights. On that date, the Group also proceeded to the
settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now covers their
maternity, paternity, adoption and pension benefits. However, the banks remain liable for benefits that concern
illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the employee,
replacing the Banking Social Healthcare System which was extinguished by the decree law referred above. As a
consequence of this amendment the capability to receive pensions by the actual employees are covered by the General
Social Security Scheme regime, considering the service period between 1 January 2011 and the retirement age. The
banks support the remaining difference for the total pension assured in the Collective Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to be
borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit during the
average lifetime of the pension until the normal retirement age is reached. The calculation of the liability for pensions
carried out periodically by the actuary considers this effect and is calculated considering the actuarial assumptions in
force, ensuring that the liabilities calculated with reference to 31 December 2010, not considering the effect of the
integration of bank employees into the General Social Security Scheme are fully covered and deducted from the amount
of the effect recognised until the date. The component of this effect for the year is recognised under the heading
\"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December, an
agreement was established between the Government, the Portuguese Banking Association and the Banking Labour
Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to pensioners
and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of Collective
Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in pensions as well as any
other complements, namely, contributions to the Health System (SAMS), death benefit and death before retirement
benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the two
union federations of the unions that represent the Group's employees, which introduced changes in the Social Security
clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new ACT was published by
the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and the effects were recorded in
the financial statements of 31 December 2016, for employees associated with these four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the new
ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the effects of
this new ACT recorded in the financial statements as at 31 December 2017, for employees associates of SBN.
The most relevant changes in the ACT were the change in the retirement age (presumed disability) from 65 years to 66
years and two months in 2016 and the subsequent update of an additional month in each year, which cannot, in any
case, be higher than the one in force at any moment in the General Regime of Social Security, the change in the
formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new benefit called the
End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had an
impact on the present value of the liabilities with services rendered and were recognised in the income statement for
the year under \"Staff costs\".
In 2017, after the authorization of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF - Portuguese
Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was amended. The main
purpose of the process was to incorporate into the pension fund the changes introduced in the Group's ACT in terms of
retirement benefits, as well as to transfer to the pension fund the responsibilities that were directly chargeable to the
company (extra-fund liabilities). The pension fund has a part exclusively for the financing of these liabilities which, in
the scope of the fund, is called Additional Complement. The End of Career Premium also became the responsibility of
the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year basis
on 31 December and 30 June of each year, and whenever there are significant market fluctuations or significant
specific events, such as changes in the plan, curtailments or settlements since the last estimation. The responsibilities
with past service are calculated using the Projected Unit Credit method and actuarial assumptions considered
adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately for
each plan by estimating the amount of future benefit that employees have earned in return for their service in the
current and prior periods. The benefit is discounted to determine its present value, using a discount rate determined by
reference to interest rates of high- quality corporate bonds that have maturity dates approximating the terms of the
Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of the Pension Plan's
assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability with
retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the determination of
the retirement pension liabilities. On this basis, the income/cost net of interest includes the interest costs associated
with retirement pension liabilities and the expected return of the plan's assets, both measured based on the discount
rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences between
actuarial assumptions used and the amounts actually observed (experienced gains and losses) and changes in actuarial
assumptions and (ii) gains and losses arising from the difference between the expected return of the plan's assets and
the amounts obtained, are recognised against equity under \"Other comprehensive income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii) the
income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and, (v)
the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension plan is
recognised as interest and similar income or interest expense and similar costs depending on their nature. The costs of
early retirements correspond to the increase in liabilities due to the employee's retirement before reaching the age of
retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the spouse
and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific contribution
plan that ensures the solvency of the fund. In the end of each year, according to Bank of Portugal Notice no. 12/2001,
the minimum level required for the responsibilities funding must be 100% regarding pension payments and 95%
regarding past services of active employees.
R2.Revision of the salary tables for employees in service and pensions in payment
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates took
effect on 1 January 2021, except for compensation for subsistence and travel allowances, which were updated after the
agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions Mais Sindicato do Sector Financeiro, SBC \u2013 Sindicato Banc\u00e1rios do Centro and SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal, the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates took effect on 1 January 2022,\u00a0 except for compensation for subsistence
and travel allowances, which were updated after the agreed updates are operational.
Regarding SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios and SIB \u2013 Sindicato Independente da Banca, an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing.
R3.Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees are
recognised as expenses when incurred.
As at 31 December 2022, the Group has two defined contribution plans. One plan covers employees who were hired
before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and equal to 1%
of the annual remuneration paid to employees in the previous year. Contributions shall only be made if the following
requirements are met: (i) the Bank's ROE equals or exceeds the rate of government bonds of 10 years plus 5 percentage
points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the current
month, either by themselves or by the Group and employees. This contribution has a mandatory character and is
defined in the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4.Variable remuneration paid to employees
The remuneration policy for employees includes an annual variable remuneration system for employees not covered by
commercial incentive systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and of the annual fixed
remuneration of reference for the role performed, and provided that the Bank's minimum level of performance, as
measured by a set of quantitative indicators, is met, the amount of the variable remuneration to be attributed to each
employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the respective
allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to employees is
recorded against the income statement in the period to which it relates.
R5.Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets approved
by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred taxes relating
to tax losses and to temporary differences between the accounting net income and the net income accepted by the Tax
Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable probability that these taxes
will be paid or recovered in the future.
Income tax registered in net income for the year comprises current and deferred tax effects. Income tax is recognised
in the income statement, except when related to items recognised directly in equity, which implies its recognition in
equity. Deferred taxes arising from the revaluation of financial assets at fair value through other comprehensive income
and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are recognised after in the income
statement at the moment the profit and loss that originated the deferred taxes are recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for tax
purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor taxable
profit and differences relating to investments in subsidiaries to the extent that probably they will not reverse in the
foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairments not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairments will be deductible
for the purposes of determining taxable income for the tax periods in which the legal conditions required for their tax
deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if: (i)
it has a legally enforceable right to offset current tax assets and current tax liabilities; and, (ii) the deferred tax assets
and the deferred tax liabilities relate to income taxes released by the same Tax Authority on either the same taxable
entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred any material impact on the Bank\u2019s financial statements
resulting from its application.
In 2016, the Bank adhered to the Special Tax Regime for Groups of Companies (RETGS) for the purposes of IRC taxation,
with BCP being the dominant entity. In the financial years of 2022 and 2021, RETGS application was maintained. In
2021, Millennium bcp Participa\u00e7\u00f5es Sociais \u2013 Sociedade Unipessoal, Lda. and BCP \u00c1frica, SGPS, Lda., were included in
the group of companies covered by this regime, being now covered by the general IRC regime. The group's taxable
profit is calculated by the algebraic sum of taxable profits and individual tax losses of the companies that integrate it.
T.Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by operating and
geographic segments. A business segment is a Group's component: (i) which develops business activities that can obtain
revenues or expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking
decisions about allocating resources to the segment and assess its performance; and, (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013Retail Banking, also including ActivoBank;
\u2013Companies, Corporate and Investment Banking;
\u2013Private Banking;
\u2013Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralized management of financial investments, corporate activities, and insurance activity.
Foreign activity:
\u2013Poland;
\u2013Mozambique;
\u2013Other.
The \"Other\" segment (foreign activity) includes the activity arising from the discontinued operations in Switzerland and
Cayman Islands (operation liquidated in 2022) and also the contribution of the participation in an associate in Angola. It
should be noted that, following the sale of the operation in Switzerland on 2 November 2021, the subsidiary's net
income in December 2021and the capital gain generated with the sale of the entire shareholding in Banque Priv\u00e9e BCP
(as well as the adjustments occurred in 2022), are reflected as income arising from discontinued operations, as
provided for in IFRS 5.
U.Provisions, Contingent liabilities and Contingent assets
U1.Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and, (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganizations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognized for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected cost,
the most likely result of current actions and considering the risks and uncertainties inherent to the process result. On
the cases that the discount effect is material, provision corresponds to the actual value of the expected future
payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted through
profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the case
that these obligations cease to exist.
U2.Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow of
resources is probable.
U3.Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the possibility
of an outflow of resources regarding economic benefits is not remote. The Group registers a contingent liability when:
i)it is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non- occurrence of one or more uncertain future events that are not wholly within the control of the Group; or,
ii)it is a present obligation that arises from past events but is not recognised because:
a)it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b)the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
V.Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares purchased
by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to consider
conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as dilutive when
their conversion to shares would decrease net earnings per share. If the earnings per share are changed because of an
issue with premium or discount or other event that changed the potential number of ordinary shares or because of
changes in the accounting policies, the earnings per share for all presented periods should be adjusted retrospectively.
W.Insurance contracts
W1.Classification
The Group issues contracts that contain insurance risk, financial risk or a combination of both insurance and financial
risk. A contract, under which the Group accepts significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in accordance with
the accounting policies applicable to insurance contracts. A contract issued by the Group that transfers only financial
risk, without discretionary participating features, is accounted for as a financial instrument.
W2.Recognition and measurement
Premiums of life insurance and investment contracts with discretionary participating features, which are considered as
long-term contracts are recognised as income when due from the policyholders. The benefits and other costs are
recognised concurrently with the recognition of income over the life of the contracts. This specialization is achieved
through the establishment of provisions/liabilities of insurance contracts and investment contracts with discretionary
participating features.
The responsibilities correspond to the present value of future benefits payable, net of administrative expenses directly
associated with the contracts, less the theoretical premiums that would be required to comply with the established
benefits and related expenses. The liabilities are determined based on assumptions of mortality, costs of management
or investment at the valuation date.
For contracts where the payment period is significantly shorter than the period of benefit, premiums are deferred and
recognised as income in proportion to the duration period of risk coverage. Regarding short-term contracts, including
contracts of non-life insurance, premiums are recorded at the time of issue. The award is recognised as income
acquired on a pro-rata basis during the term of the contract. The provision for unearned premiums represents the
amount of issued premiums on risks not occurred.
W3.Premiums
Issued gross premiums are recognised for as income in the period to which they respect independently from the
moment of payment or receivable, in accordance with the accrual accounting principle. Reinsurance premiums ceded
are accounted for as expense in the period to which they respect in the same way as gross premiums written.
W4.Provision for unearned premiums from direct insurance and reinsurance premiums ceded
The provision for unearned gross premiums is based on the evaluation of the premiums written before the end of the
year but for which the risk period continues after the year end. This provision is calculated using the pro-rata temporis
method applied to each contract in force.
W5.Liability adequacy test
At each reporting date, the Group evaluates the adequacy of liabilities arising from insurance contracts and investment
contracts with discretionary participating features. The evaluation of the adequacy of responsibilities is made based on
the projection of future cash flows associated with each contract, discounted at market interest rate without risk. This
evaluation is done product by product or aggregate of products when the risks are similar or managed jointly. Any
deficiency, if exists, is recorded in the Group's results as determined.
X.Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorized by Autoridade de Supervis\u00e3o de Seguros e
Fundos de Pens\u00f5es (ASF) for the practice of insurance intermediation in the category of Linked Insurance Broker, in
accordance with Article 8, paragraph a), subparagraph i) of Decree-Law no. 144/2006, of 31 July, carrying out
insurance intermediation activities in life and non-life segments.
Within the scope of insurance intermediation services, these banks perform the sale of insurance contracts. As
compensation for insurance intermediation services, they receive commissions for arranging insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurance Companies.
Commissions received for insurance intermediation are recognised in accordance with the accrual accounting principle,
so the commissions whose receipt occurs at a different time from the period to which they refer are recognised as an
amount receivable under the item \"Other assets\". Commissions received for insurance mediation services are recognized
in accordance with the policy described in note I. Recognition of income from services and commissions.
Y.Accounting estimates and judgments in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgments and to make estimations when deciding which treatment is the most appropriate.
These estimates were made considering the best information available at the date of preparation of the consolidated
financial statements, considering the context of uncertainty that results from the current economic scope. The most
significant of these accounting estimates and judgments used when applying accounting principles are discussed in this
section to improve understanding of how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different treatment
was chosen. The Executive Committee believes that the choices made are appropriate and that the financial
statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1.Entities included in the consolidation perimeter
For the purposes of determining entities to include in the consolidation perimeter, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession of
these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by the
Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is exposed to
the variable returns and its ability to use its power to affect these returns. Different estimations and assumptions could
lead the Group to a different scope of consolidation perimeter with a direct impact in consolidated income.
Y2.Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax determination
is uncertain during the ordinary course of business. Different interpretations and estimations could result in a different
level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in which
the Group considers projections of future taxable income based on a set of assumptions, including the estimate of
income before tax, adjustments to taxable income, evolution of tax legislation and its interpretation. Thus, the
recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors strategy, namely
the ability to generate the estimated taxable income, the evolution of tax law and its interpretation.
Regarding the activity in Portugal, Regulatory Decrees no. 5/2016, of 18 November, no. 11/2017, of 28 December, and
no. of impairment losses and other value corrections for specific credit risk deductible for the purposes of calculating
taxable income based on IRC in the years 2016, 2017 and 2018, respectively. These Regulatory Decrees establish that
Bank of Portugal Notice No. 3/95 (Notice that was relevant for the determination of loan provisions in the financial
statements presented in NCA) must be considered for the purposes of calculating the maximum limits of impairment
losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
Law No. 98/2019, of September 4, established the tax regime for credit impairments and provisions for guarantees for
tax periods beginning on or after January 1, 2019, providing for approximation between accounting rules and tax for
the purposes of deductibility of expenses with the strengthening of credit impairments. The rules in force until 2018
could continue to be applied until the end of the 2023 financial year, unless the option to apply the new regime was
exercised in advance.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, the Bank exercised the option to apply the new regime, under the terms of which the impairment
losses for credit risk relating to exposures analysed on an individual basis or on a collective basis recognized in
accordance with applicable accounting standards and regulations, maintaining the rules in force until 2018 for the
balance of impairment losses and other value adjustments for specific credit risk recorded up to 31 December 2021.
Following the amendments provided for in Law No. 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This amendment
applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax losses calculated in
tax periods prior to January 1, 2023 and whose deduction period is still in progress on that date. Thus, tax losses
calculated in 2014 and subsequent years may be deducted from future taxable income. The deduction limit for tax
losses increased from 70% to 65%, being increased by ten percentage points when the difference results from the
deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of the special regime provided for
in Law n. 27-A/2020, of 24 July 24.
In the projections of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2022, the approximation between the accounting and tax rules
provided for in the aforementioned Law n.\u00ba 98/2019 was considered, of 4 September, taking into account the option for
applying the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the
use of tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any deduction or tax credit being
used, in which the expiry period is the exercise of that right. The Bank recorded provisions or liabilities for deferred
taxes in the amount it considers appropriate to cover tax corrections or tax losses incurred, as well as contingencies
relating to years not yet reviewed by the tax authorities.
Y4.Non-current assets held for sale (real estate) valuation
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Bank's historical experience in the commercialization of real estate, its perspectives on the evolution
of the real estate market and the intentions of the management body regarding the commercialization of these assets.
The assumptions used in the valuations of these assets have an impact on their valuation and consequently on the
determination of impairment.
Y5.Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
projections, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
As defined by IAS 19, the discount rate used to update the responsibilities of the Bank's pension fund is based on an
analysis performed over the market yields regarding a bond issues universe \u2013 that the Group considers having high
quality (low risk), different maturities (appropriate to the period of liquidation of the fund's liabilities) and
denominated in euros - related to a diverse and representative range of issuers.
Y6.Financial instruments \u2013 IFRS 9
Y6.1.Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and interest
on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed together to
achieve a specific business objective. This evaluation requires judgment, since the following aspects, among others,
must be considered: the way in which the performance of assets is evaluated; the risks that affect the performance of
the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other comprehensive
income that are derecognised prior to their maturity to understand the underlying reasons for their disposal and to
determine whether they are consistent with the purpose of the business model defined for these assets. This monitoring
is part of a process of continuous evaluation by the Group of the business model of the financial assets that remain in
the portfolio, to determine if it is adequate and, if it is not, if there was a change in the business model and,
consequently, a prospective classification change of these financial assets.
Y6.2.Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
Y6.3.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7. Provisions for risk associated with mortgage loans indexed to the Swiss franc
The Group creates provisions for legal contingencies related to mortgage loans indexed to the Swiss franc granted by
Bank Millennium, S.A.
The assumptions used by the Bank are essentially based on historical observations and will have to be updated in
subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The methodology developed by
the Bank is based on the following parameters: (i) the number of current (including class actions) and potential future
court cases that will appear within a specified time horizon; (ii) the amount of the Bank\u2019s potential loss in the event of
a specific court judgment (three negative judgment scenarios were taken into account); (iii) the probability of
obtaining a specific court verdict calculated on the basis of statistics of judgments of the banking sector in Poland and
legal opinions obtained; (iv) in the case of a loan agreement invalidity scenario, the Bank Millennium's loss is calculated
taking into account the assignment of a minimum probability of receiving the settlement of a remuneration for the cost
of use of capital; and (v) amicable settlement with clients in or out of court.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the swiss franc and the
amount of the Bank\u2019s actual losses depend, namely, on the number of ongoing and potential lawsuits, as well as on the
final court decisions about each case and amicable settlement with clients.
\u00a0 \u00a0 Z. Subsequent events
The Group analyses events occurred after the balance sheet date, i.e., favourable and/or unfavourable events that
occur between the balance sheet date and the date the financial statements were authorized for issue. In this context,
two types of events can be identified:
i)those that provide evidence of conditions that existed at the balance sheet date (events after the balance sheet
date that give rise to adjustments); and,
ii)those that are indicative of the conditions that arose after the balance sheet date (events after the balance sheet
date that do not give rise to adjustments).
Events occurred after the date of the financial statements that are not considered as adjustable events, if significant,
are disclosed in the notes to the consolidated financial statements.
", "dimensions": { "concept": "ifrs-full:DisclosureOfSummaryOfSignificantAccountingPoliciesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-553": { "value": "Accounting policies
A.Basis of presentation
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the Bank
and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the years ended
on 31 December 2022 and 2021.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2022 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in Portuguese. In
the event of discrepancies, the Portuguese version prevails.
A1.Comparative information
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1 January 2022.
The accounting policies were applied consistently to all entities of the Group and are consistent with those used in the
preparation of the financial statements of the previous period.
The Group's financial statements were prepared under the going concern assumption, the accrual-based accounting
regime and under the historical cost convention, as modified by the application of fair value for derivative financial
instruments, financial assets and liabilities at fair value through profit or loss and financial assets at fair value through
other comprehensive income. Financial assets and liabilities that are covered under hedge accounting are stated at fair
value in respect of the risk that is being hedged, if applicable. Other financial assets and liabilities and non-financial
assets and liabilities are stated at amortised cost or historical cost. Non-current assets and disposal groups held for sale
are stated at the lower of carrying amount or fair value less costs to sell. The liability for defined benefit obligations is
recognised as the present value of the past liabilities with pensions net of the value of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice of
the Executive Committee, to make judgments, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and associated
assumptions are based on historical experience and other factors that are believed to be reasonable under the
circumstances and form the basis for making the judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimations. The issues involving a higher
degree of judgment or complexity or for which assumptions and estimations are significant are presented in note 1.Y.
B.Basis of consolidation
As from 1 January 2010, the Group began to apply IFRS 3 (revised) for the accounting of business combinations. The
changes in the accounting policies resulting from the application of IFRS 3 (revised) are applied prospectively.
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the Bank
and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1.Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
B2.Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3.Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
B4.Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is accounted as a
transaction with shareholders and, therefore, no additional goodwill resulting from this transaction is recognised. The
difference between the acquisition cost and the fair value of non-controlling interests acquired is recognised directly in
reserves. On this basis, the gains and losses resulting from the sale of controlling interests that do not impact the
control position of a subsidiary are always recognised against reserves.
B5.Loss of control
The gains and losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6.Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity methods,
exchange differences, between the conversion to euros of the equity at the beginning of the year and its value in euros
at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are recognised against
\u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that are designated and
qualified as hedging instruments related to foreign operations are recorded in equity under \"Reserves and retained
earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted against profit and loss of the
year.
The income and expenses of these subsidiaries are converted to euros at an approximate rate of the rates on the dates
of the transactions, using a monthly average considering the initial and final exchange rates of each month. Exchange
differences from the conversion to euros of the profits and losses for the reporting period, arising from the difference
between the exchange rate used in the income statement and the exchange rate prevailing at the balance sheet date,
are recognised in \"Reserves and retained earnings - exchange differences resulting from the consolidation of Group's
companies\". The exchange rates used by the Group are detailed in note 54.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to the
investment in the foreign operation and to the associated hedge transaction previously recognised in reserves are
transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associated companies, its effects are included in
the Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items are
recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy until 31
December 2018. This classification is no longer applicable as of 1 January 2019.
B7.Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from these
transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains and losses
arising from transactions with associates and jointly controlled entities are eliminated in the proportion of the Group's
investment in these entities.
C.Financial instruments (IFRS 9)
C1.Financial assets
C1.1.Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013\u201cFinancial assets at amortised cost\u201d;
\u2013\u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013\u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013the Group's business model for the management of the financial asset; and,
\u2013the characteristics of the contractual cash flows of the financial asset.
Business Model Evaluation
With reference to 1 January 2018, the Group carried out an evaluation of the business model in which the financial
instruments are held at portfolio level, since this approach reflects how assets are managed and how that information
is made available to management bodies. The information considered in this evaluation included:
\u2013the policies and purposes established for the portfolio and the practical operability of these policies, including how
the management strategy focuses on receiving contractual interest, maintaining a certain interest rate profile,
adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the realization
of cash flows through the sale of the assets;
\u2013how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013the evaluation of the risks that affect the performance of the business model (and of the financial assets held under
this business model) and the way these risks are managed;
\u2013the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the assets
under management or on contractual cash flows received; and,
\u2013the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the expectations
about future sales. However, sales information should not be considered individually, but as part of an overall
assessment of how the Group establishes financial asset management objectives and how cash flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured at
fair value through profit or loss because they are not held either for the collection of contractual cash flows (HTC), nor
for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial recognition.
\"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with the amount
owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk and
administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation included
the analysis of the existence of situations in which the contractual terms can modify the periodicity and the amount of
the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group considered:
\u2013contingent events that may change the periodicity and the amount of the cash flows;
\u2013characteristics that result in leverage;
\u2013terms of prepayment and extension of maturity;
\u2013terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal value;
\u2013the prepayment represents substantially the nominal amount of the contract plus accrued contractual interest, but
not paid (may include reasonable compensation for prepayment); and,
\u2013the prepaid fair value is insignificant at initial recognition.
C1.1.1.Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following conditions
are met:
\u2013the financial asset is held within a business model whose objective is to hold financial assets in order to collect their
contractual cash flows; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and advances
to customers and debt instruments managed based on a business model whose purpose is to receive their contractual
cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
C1.1.2.Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive income\"
if both of the following conditions are met:
\u2013the financial asset is held within a business model whose objective is both to collect its contractual cash flows and
to sell this financial asset; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent retribution
recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may irrevocably choose to
classify it in the category of \"Financial assets at fair value through other comprehensive income\" (FVOCI). This option is
exercised on a case-by-case basis and is only available for financial instruments that comply with the definition of
equity instruments provided in IAS 32 and cannot be used for financial instruments whose classification as an equity
instrument under the scope of the issuer is made under the exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
C1.1.3.Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2.Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management has
changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including the
ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other comprehensive income is
not allowed, nor of financial instruments designated at fair value through profit or loss.
C1.3.Modification and derecognition of financial assets
General principles
i)The Group shall derecognise a financial asset when, and only when:
\u2013the contractual rights to the cash flows from the financial asset expire; or,
\u2013it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii)The Group transfers a financial asset if, and only if, it either:
\u2013transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to
pay the cash flows to one or more recipients in an arrangement that meets the conditions presented in note iii).
iii)When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'), but
assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'), the
Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are met:
\u2013the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without material
delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents
(as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the collection date until the
date of required remittance to the eventual recipients, and interest earned on such investments is passed to the
eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and benefits arising from owning the financial asset. In this case:
\u2013if the Group transfers substantially all the risks and benefits arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013if the Group retains substantially all the risks and benefits arising from owning the financial asset, it shall continue
to recognise the financial asset;
\u2013if the Group neither transfers nor retains substantially all the risks and benefits arising from owning the financial
asset, it shall determine whether it retained control of the financial asset. In this case:
a)if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as assets or
liabilities, any rights and obligations created or retained in the transfer;
b)if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and benefits (see prior note) is evaluated by comparing the Group\u2019s exposure, before and after
the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset depends
on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in its entirety
to an unrelated third party and can exercise that ability unilaterally without needing to impose additional
restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of new
ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that may lead
to the derecognition of a financial asset.
The Bank considers that a modification of the terms and conditions of a credit exposure will result in derecognition of
the transaction and in recognition of a new transaction when the modification translates into at least one of the
following conditions:
\u2013creation of a new exposure that results from a debt consolidation, without any any of the derecognized instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to the
residual maturity in the moment of the modification;
\u2013Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or managed
within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on the
financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv of
the above paragraph should be checked (the other criteria listed in this paragraph are not relevant in such situations).
Under the regulatory changes that occurred in Poland described in note 48 and those negotiated with customers holding
mortgage loans in foreign currency described in note 57, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a given
asset is not derecognised, Bank Millennium adjusts the gross book value of the financial asset and recognises the profit
or loss due to the modification in the Income Statement - Results on modification. The adjustment to the gross carrying
amount of a financial asset is the difference between the discounted cash flows before and after contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its entirety
or partially. Loans written-off are recognised in off-balance sheet accounts.
C1.4.Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit impairment
in the moment of their initial recognition. An asset is credit-impaired if one or more events have occurred with a
negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013financial assets arising from a recovery process, where there have been changes to the terms and conditions of the
original agreement, which presented objective evidence of impairment that resulted in its derecognition (note C1.3)
and recognition of a new contract that reflects the credit losses incurred;
\u2013financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses (ECL)
are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition, the gross
book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value before being
recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5.Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2.Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the income
statement under \"Impairment of financial assets at fair value through other comprehensive income\", against other
comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3.Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are recognised in
liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other provisions\" (in the
income statement).
C1.5.2.Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
C1.5.3.Significant increase in credit risk (SICR)
Significant increase in credit risk (SICR) is determined according to a set of mostly quantitative, but also qualitative
criteria. These criteria are mainly based on the risk grades of customers, according to the Bank's Rating Master Scale,
and on its evolution, in order to detect significant increases in Probability of Default (PD), complemented by other
information regarding the customers\u2019 behaviour towards the financial system.
C1.5.4.Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than Euros 100 (retail) or more than Euros 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in which the
customer is in this situation have been counted, it is classified as default (or GR15).
The existence of a material payment delay gives rise to the default setting (GR15) of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i.Credit restructuring due to financial difficulties with loss of value;
ii.Delay after restructuring due to financial difficulties;
iii.Recurrence of restructuring due to financial difficulties;
iv.Credit with signs of impairment (or stage 3 of IFRS 9);
v.Insolvency or equivalent proceedings;
vi.Litigation;
vii.Guarantees of operations in default;
viii.Credit sales with losses;
ix.Credit fraud;
x.Unpaid credit status;
xi.Breach of covenants in a credit agreement;
xii.Spread of default in an economic group;
xiii.Cross default in BCP Group.
C1.5.5.Estimates of expected credit losses - Individual analysis
1.Customers who are in one of the following conditions are subject to individual analysis:
Customers in default
Customers in litigation or insolvency, if the total exposure of the group members in these situations exceeds
Euros 1 million
Customers integrated into groups with an exposure over Euros 5 million, if they have a risk grade 15
Groups or customers
who are not in
default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over Euros 5 million, if a group member has a risk grade 14
Groups or customers with an exposure over Euros 5 million, if a member of the group has a restructured loan
and a risk grade 13
Groups or customers with an exposure over Euros 10 million, if at least one member of the group is in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds Euros 25 million
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
6.Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery period
to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk Office as
part of the regular process of collecting information, accompanied by detailed justification of the proposed
impairment.
7.The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be a
weighted rate considering the different recovery prospects for each part of the customer's liabilities.
8.The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualized perspective, the latter when cases that, due to their specificity, have a
high degree of uncertainty regarding the expected recovery estimation are identified.
9.The macroeconomic adjustment set out in point 8 should be analysed annually and weighted according to the type
of recovery strategy associated with the exposure under analysis:
\u2013for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global way,
to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one scenario;
\u2013for Gone Concern strategies (i.e., the recovery estimation is based on the realization of the collateral), the impact
of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the projected real
estate index indicates significant changes ahead for the current valuation values.
10.It is the responsibility of the units referred to in point 5 to consider in their projection macroeconomic expectations
that may influence the recoverability of the debt.
11.For the purposes of the preceding paragraphs, the Economic Studies, Sustainability and Cryptoassets Department
shall disclose the macroeconomic data that allow the estimations to be made.
12.The decision to consider global impacts related to the going and gone concern scenarios should be made by the Risk
Committee, as proposed by the Risk Office.
13.For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be considered
casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013recovery of collateral in geographies in which the Bank has no relevant recovery experience;
\u2013recovery of debt related to geographies in which there is strong political instability;
\u2013recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013recovery of debt related to debtors for whom there is a strong negative public exposure.
14. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
15.Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 12 of the Master Scale.
16.The individual impairment analysis must be carried out at least annually. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to promote
the review of the expected impairment of this customer.
C1.5.6.Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis are grouped considering their risk characteristics
and subject to a collective impairment analysis. The Group's credit portfolio is divided by internal risk grades and
according to the following segments:
a)Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project finance,
Institutions (banks/financial institutions) and Sovereigns;
b)Segments not \u2018low default\u2019: - Retail: Mortgages; Overdrafts; Credit cards; Small and medium enterprises - Retail
(\u2018SME Retail\u2019); and Others - Corporate: Small and medium enterprises - Corporate (\u2018Large SME\u2019); and Real Estate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013financial assets with no signs of impairment at the reporting date: the present value of the difference between the
contractual cash flows and the cash flows that the Group expects to receive;
\u2013financial assets with impairment at the reporting date: the difference between the gross book value and the present
value of the estimated cash flows;
\u2013unused credit commitments: the present value of the difference between the resulting contractual cash flows if the
commitment is made and the cash flows that the Group expects to receive;
\u2013financial guarantees: the current value of the expected repayments less the amounts that the Group expects to
recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013Probability of Default \u2013 PD;
\u2013Loss Given Default \u2013 LGD; and,
\u2013Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering the
already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These models
are based on internal data including both quantitative and qualitative factors. If there is a change in the risk of the
counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated considering the
contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates the
LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models consider
the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs. In the case
of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of high relevance
in the determination of LGD.
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD values
from the counterparty's current exposure and potential changes to its current value as a result of the contractual
conditions, including amortisations and prepayments. For commitments and financial guarantees, the value of the EAD
will consider both the amount of credit used and the expectation of future potential value that may be used in
accordance with the agreement.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a longer
period. The maximum contractual period shall be considered as the period up to the date on which the Group has the
right to require payment or end the commitment or guarantee.
The Group adopted as a residual term criterion for renewable operations, when in stage 2, a term of 5 years. This term
was determined based on the behavioural models of this type of product applied by the Bank in the liquidity risk and
interest rate (ALM) analysis. According to these models, the maximum period of repayment of these operations is the 5
years considered conservatively in the scope of the calculation of credit impairment.
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-looking
information is carried out in the relevant elements considered for the calculation of expected credit losses (ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing exposures
at the reference date becoming defaulted exposures considers the expected values for a set of macroeconomic
variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the Bank's Economic Studies
area. These scenarios, which are used across the Bank for various purposes besides calculating impairment, consider
existing projections by reference entities.
In December 2022 the Bank carried out an update of the macroeconomic scenarios and of the corresponded adjustment
of the parameters considered in the collective impairment model.
C2.Financial liabilities
C2.1.Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013\u201cFinancial liabilities at amortised cost\u201d;
\u2013\u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1.Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a)\u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that form
part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a
recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as hedging
instrument).
b)\u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in market
conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with the costs or
income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of
that liability shall be presented in other comprehensive income;
\u2013the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest expense and similar
charges\" based on the effective interest rate of each transaction.
C2.1.2.Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial guarantee
contracts are subsequently measured at the highest of the following amounts:
\u2013the provision for losses determined according to the criteria described in note C1.5;
\u2013the amount initially recognised deducted, when appropriate, from the accumulated amount of income recognised
according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial assets at amortised cost\" includes resources from credit institutions and from customers, as
well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in \"Interest expense and
similar charges\", based on the effective interest rate method.
C2.2.Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3.Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.
C3.Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
C4.Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance with IAS
39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and foreign
exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge accounting
are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in accordance
with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013at the inception of the hedge there is formal documentation of the hedge;
\u2013the hedge is expected to be highly effective;
\u2013the effectiveness of the hedge can be reliably measured;
\u2013the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to variations in
cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets or
liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised through
profit and loss, as well as changes in currency risk of the monetary items.
C4.1.Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are recognised
in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or liability or
group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge accounting, the
cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised until the
discontinuance of the hedge accounting are amortised through profit and loss over the residual term of the hedged
item.
C4.2.Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify as
cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge relations. Any
gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will affect
profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the hedging
relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked, the hedge
relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative accumulated in
equity until the date of the discontinued hedge accounting can be:
\u2013deferred over the residual period of the hedged instrument; or,
\u2013recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised in
equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income statement.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is
immediately transferred to profit and loss.
C4.3.Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such, the
Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective tests in
order to demonstrate at each reporting period the effectiveness of the hedging relationships, demonstrating that the
variations in fair value of the hedging instrument are hedged by the fair value variations of the hedged item in the
portion assigned to the risk covered. Any ineffectiveness is recognised immediately in profit and loss when incurred.
C4.4.Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange gain or
loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The gain or loss
relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses accumulated in equity
related to the investment in a foreign operation and to the associated hedge operation are recognised in equity and
transferred to profit and loss, on the disposal of the foreign operation as part of the gain or loss from the disposal.
C5.Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and benefits of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.Securitization operations
D1.Traditional securitizations
As at 31 December 2022, BCP has three residential mortgage credit securitization operations (Magellan Mortgages no.1,
no.3 and no.4), portfolios which were derecognised from the Bank\u2019s individual balance sheet, as the residual portions
of the referred operations were sold to institutional investors and, consequently, their risks and benefits were
substantially transferred.
By purchasing a part of the most subordinated residual portion, the Group maintained control of the assets and
liabilities of Magellan Mortgages no.3, with this Special Purpose Entity (SPE) being consolidated in the Group\u2019s financial
statements, in accordance with the accounting policy referred to in note 1 B.
The three operations are traditional securitizations, where each mortgage loan portfolio was sold to a Portuguese Loan
Titularization Fund, which has financed this purchase through the sale of titularization units to a SPE with office in
Ireland. At the same time, this SPE issued and sold in capital markets a group of different portions of bonds.
D2.Synthetic securitizations
As at 31 December 2022, BCP has three synthetic securitization operations, with similar characteristics, with reference
to credit portfolios granted by the Bank mainly to Small and Medium Enterprises (SMEs).
Caravela SME no.3, which started on 28 June 2013, has a medium and long-term loan portfolio of current accounts and
authorized overdrafts.
Caravela SME no.4, initiated on 5 June 2014, has a reference portfolio of vehicle, real estate and equipment leasing.
Caravela SME no.5, initiated on 20 December 2022, is supported on a credit portfolio of medium and long term loans,
leasing contracts and commercial paper programmes.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitizations, under CDS, the risk
of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity.
In the case of both Caravela no. 3 and no. 4, the mezzanine and part of the equity (20%) were placed in the market
through the issuance of Credit Linked Notes (CLNs) by the above mentioned SPE which were subscribed by investors,
while the Group retained the senior risk and the remaining part of the equity (80%). In the case of Caravela, SME no. 5,
only the full amount of the mezzanine was placed in the market, while the Group retained the risk of the full amount
of the senior and equity tranches.
Note that in all the above-mentioned synthetic transactions, the product of the CLNs issue was invested by the SPE in a
deposit, which fully collateralizes the responsibilities in the presence of its creditors including BCP in accordance with
the CDS.
In March 2022, the Group's subsidiary Bank Millennium concluded a synthetic securitization transaction with the
participation of European Investment Bank (EIB) and European Investment Fund (EIF). The portfolio covered by the
transaction concerned receivables from small and medium-sized enterprises (SME).\u00a0 Bank Millennium obtained the EIF
guarantee for the senior tranche and the junior tranche, which is unfunded credit protection within the meaning of the
CRR. The selected loan portfolio covered by the securitization remained in the Bank Millennium''s balance sheet.
On 23 December 2022, Bank Millennium settled another synthetic securitisation transaction executed on a portfolio of
corporate and SME receivables. The selected loan portfolio securitised remained on the bank's balance sheet. The risk
transfer was affected by a recognised credit protection instrument in the form of Credit Linked Notes (CLNs).
The transaction meets the requirements for the transfer of a material part of the risk, set out in the CRR Regulation
(Regulation of the European Parliament and of the Council No. 575/2013 of 26 June 2013 on prudential requirements
for credit institutions and investment firms).
E.Equity instruments
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to deliver
cash or another financial asset to another entity or to exchange financial assets or financial liabilities with another
entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may be settled in
the issuer's own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to
deliver a variable number of its own equity instruments or a derivative that will be settled only by the issuer
exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity after
deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to the
amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised in equity,
net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is solely
at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are deducted
to equity.
F.Securities borrowing and repurchase agreement transactions
F1.Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are measured
in accordance with the applicable accounting policy. Cash collateral received in respect of securities lent is recognised
as a financial liability. Securities borrowed under securities borrowing agreements are not recognised. Cash collateral
placements in respect of securities borrowed are recognised under loans and advances to either banks or customers.
Income and expenses arising from the securities borrowing and lending business are recognised on an accrual basis over
the period of the transactions and are included in interest income or expense (net interest income).
F2.Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities substantially
equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to reselling
agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in loans and
advances to customers or loans and advances to credit institutions. The receivables are collateralised by the related
securities. Securities sold through repurchase agreements continue to be recognised in the balance sheet and are
revaluated in accordance with the applicable accounting policy. The amounts received from the proceeds of these
securities are considered as deposits from customers and deposits from credit institutions. The difference between the
acquisition/sale and reselling/repurchase conditions is recognised on an accrual basis over the period of the transaction
and is included in interest income or expenses.
G.Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
H.Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of leases:
\u2013from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which results
in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the lease term
ends within 12 months or for those which the underlying asset is of low-value and, in these cases, the lessee may
opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments associated with these
leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below Euros 5,000. Additionally, this
standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or contains a
lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all the
economic benefits of using it, and the right to choose how to use the identified asset over a period in exchange of a
payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability plus
the value of payments made (fixed and/or variable), deducted from any lease incentives received, penalties for
terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the lessee with the
dismantling and removal of the underlying asset and/or with the recovery of its location. Subsequently, it will be
measured according to the cost model (subject to depreciations/amortisations and impairment tests);
\u2013a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013fixed payments deducted from any lease incentives receivable;
\u2013variable lease payments that depend on a rate or an index, initially measured considering the rate or index as at
the commencement date;
\u2013amounts expected to be paid by the lessee under residual values guarantees;
\u2013the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to end
the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate curve
(swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract. For term
contracts, that date is considered as the end of lease date, while for contracts without term, or with renewable terms,
it is assessed using the date in which the contract is enforceable, as well as eventual economic penalties associated
with the lease contract. In the evaluation of enforceability, the particular clauses of the contracts are considered, as
well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013by increasing their carrying amount to reflect interest;
\u2013by reducing their carrying amount to reflect lease payments;
\u2013carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the review
of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset) whenever:
\u2013the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate;
\u2013the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed
residual value, in which cases the liability is remeasured by discounting the revised lease payments using the initial
discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a
revised discount rate is used;
\u2013a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the
lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If the
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to
exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset.
The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013in the consolidated income statement:
(i)recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii)recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii)recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013.in the consolidated balance sheet:
(i)recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of financial
assets related to sublease operations measured accordingly to IFRS 9;
(ii)recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii)recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013 Payments
(cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to lease contracts of
low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in other sundry liabilities
and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019 capital portions, as detailed
in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of an
underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards
inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary, and
the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the underlying
asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
Impact of the pandemic caused by COVID-19 virus
On 12 October 2020, the European Union published an amendment to IFRS 16, associated with income concessions
related to COVID-19. This amendment allows tenants, as a practical expedient, to have the possibility to choose not to
consider a rent concession that occurs as a direct consequence of the COVID-19 pandemic as a modification of the
lease. A lessee who uses this option must account for any concession that occurs at the rent level in the same way that
he would do it under IFRS 16 \u2013 Leases, if this change did not constitute a modification of the lease. This amendment
does not affect lessors.
Within the scope of the sublease, the Group carried out the analysis of the respective contracts.
I.Recognition of income from services and commissions
In accordance with IFRS 15, the Bank recognizes revenue associated with services and commissions when (or as) a
performance obligation is satisfied when transferring a service, based on the transaction price associated with this
performance obligation. In this context, the Bank takes the following steps to recognize revenue associated with
services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the service
provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations associated with
each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also considering the
contractual terms established with the counterparty. According to this definition, a service is transferred when the
customer obtains the benefits and control associated with the service provided. In this context, the Bank also identifies
whether performance obligations are met over time (\u201cover time\u201d) or at an exact moment (\u201cpoint in time\u201d), with
revenue being recognized accordingly.
- Measurement (price to be recognized associated with each performance obligation): (i) determine the transaction
price associated with the service provided, considering the contractual terms established with the counterparty and its
usual commercial practices. The transaction price is the amount of consideration to which the Bank expects to be
entitled in exchange for transferring promised services to the customer, excluding amounts collected on behalf of third
parties. The Bank includes in the transaction price part or all of the estimated amount of the variable consideration
associated with a performance obligation, only to the extent that it is highly probable that a significant reversal in the
amount of the accrued revenue recognized will not occur when the uncertainty associated with that variable
consideration is subsequently resolved; and (ii) allocate the transaction price to each of the performance obligations
identified under the contract established with the customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a financial
instrument, income resulting from services and commissions is recorded in net interest income (Note C.3).
J.Gains/(losses) on financial operations at fair value through profit or loss, Foreign exchange
gains/(losses), Hedge accounting gains/(losses), Gains/(losses) from derecognition of assets
and liabilities at amortised cost and Gains/(losses) from derecognition of financial assets at
fair value through other comprehensive income
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e., fair
value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding dividends
received. This balance also includes the gains and losses on sale of financial assets at fair value through other
comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair value of
hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this balance, as well
as the foreign exchange gains or losses.
K.Fiduciary activities
Assets held in the scope of fiduciary activities are not recognised in the Group\u2019s consolidated financial statements. Fees
and commissions arising from this activity are recognised in the income statement in the period in which they occur.
L.Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses. Subsequent
costs are recognised as a separate asset only when it is probable that future economic benefits will result for the
Group. All other repairs and maintenance expenses are charged to the income statement during the financial period in
which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
for their death, in accordance with the terms of the two collective labour agreements approved. These benefits are
provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no. 54/2009, all
employees were covered by the provisions of the social security chapter of the ACT, and for employees who were
already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July 2009, in
accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements to
the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto de
Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January 2012. The
plan was cut, and employees were given individual acquired rights. On that date, the Group also proceeded to the
settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now covers their
maternity, paternity, adoption and pension benefits. However, the banks remain liable for benefits that concern
illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the employee,
replacing the Banking Social Healthcare System which was extinguished by the decree law referred above. As a
consequence of this amendment the capability to receive pensions by the actual employees are covered by the General
Social Security Scheme regime, considering the service period between 1 January 2011 and the retirement age. The
banks support the remaining difference for the total pension assured in the Collective Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to be
borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit during the
average lifetime of the pension until the normal retirement age is reached. The calculation of the liability for pensions
carried out periodically by the actuary considers this effect and is calculated considering the actuarial assumptions in
force, ensuring that the liabilities calculated with reference to 31 December 2010, not considering the effect of the
integration of bank employees into the General Social Security Scheme are fully covered and deducted from the amount
of the effect recognised until the date. The component of this effect for the year is recognised under the heading
\"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December, an
agreement was established between the Government, the Portuguese Banking Association and the Banking Labour
Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to pensioners
and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of Collective
Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in pensions as well as any
other complements, namely, contributions to the Health System (SAMS), death benefit and death before retirement
benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the two
union federations of the unions that represent the Group's employees, which introduced changes in the Social Security
clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new ACT was published by
the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and the effects were recorded in
the financial statements of 31 December 2016, for employees associated with these four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the new
ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the effects of
this new ACT recorded in the financial statements as at 31 December 2017, for employees associates of SBN.
The most relevant changes in the ACT were the change in the retirement age (presumed disability) from 65 years to 66
years and two months in 2016 and the subsequent update of an additional month in each year, which cannot, in any
case, be higher than the one in force at any moment in the General Regime of Social Security, the change in the
formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new benefit called the
End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had an
impact on the present value of the liabilities with services rendered and were recognised in the income statement for
the year under \"Staff costs\".
In 2017, after the authorization of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF - Portuguese
Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was amended. The main
purpose of the process was to incorporate into the pension fund the changes introduced in the Group's ACT in terms of
retirement benefits, as well as to transfer to the pension fund the responsibilities that were directly chargeable to the
company (extra-fund liabilities). The pension fund has a part exclusively for the financing of these liabilities which, in
the scope of the fund, is called Additional Complement. The End of Career Premium also became the responsibility of
the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year basis
on 31 December and 30 June of each year, and whenever there are significant market fluctuations or significant
specific events, such as changes in the plan, curtailments or settlements since the last estimation. The responsibilities
with past service are calculated using the Projected Unit Credit method and actuarial assumptions considered
adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately for
each plan by estimating the amount of future benefit that employees have earned in return for their service in the
current and prior periods. The benefit is discounted to determine its present value, using a discount rate determined by
reference to interest rates of high- quality corporate bonds that have maturity dates approximating the terms of the
Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of the Pension Plan's
assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability with
retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the determination of
the retirement pension liabilities. On this basis, the income/cost net of interest includes the interest costs associated
with retirement pension liabilities and the expected return of the plan's assets, both measured based on the discount
rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences between
actuarial assumptions used and the amounts actually observed (experienced gains and losses) and changes in actuarial
assumptions and (ii) gains and losses arising from the difference between the expected return of the plan's assets and
the amounts obtained, are recognised against equity under \"Other comprehensive income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii) the
income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and, (v)
the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension plan is
recognised as interest and similar income or interest expense and similar costs depending on their nature. The costs of
early retirements correspond to the increase in liabilities due to the employee's retirement before reaching the age of
retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the spouse
and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific contribution
plan that ensures the solvency of the fund. In the end of each year, according to Bank of Portugal Notice no. 12/2001,
the minimum level required for the responsibilities funding must be 100% regarding pension payments and 95%
regarding past services of active employees.
R2.Revision of the salary tables for employees in service and pensions in payment
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates took
effect on 1 January 2021, except for compensation for subsistence and travel allowances, which were updated after the
agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions Mais Sindicato do Sector Financeiro, SBC \u2013 Sindicato Banc\u00e1rios do Centro and SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal, the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates took effect on 1 January 2022,\u00a0 except for compensation for subsistence
and travel allowances, which were updated after the agreed updates are operational.
Regarding SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios and SIB \u2013 Sindicato Independente da Banca, an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing.
R3.Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees are
recognised as expenses when incurred.
As at 31 December 2022, the Group has two defined contribution plans. One plan covers employees who were hired
before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and equal to 1%
of the annual remuneration paid to employees in the previous year. Contributions shall only be made if the following
requirements are met: (i) the Bank's ROE equals or exceeds the rate of government bonds of 10 years plus 5 percentage
points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the current
month, either by themselves or by the Group and employees. This contribution has a mandatory character and is
defined in the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4.Variable remuneration paid to employees
The remuneration policy for employees includes an annual variable remuneration system for employees not covered by
commercial incentive systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and of the annual fixed
remuneration of reference for the role performed, and provided that the Bank's minimum level of performance, as
measured by a set of quantitative indicators, is met, the amount of the variable remuneration to be attributed to each
employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the respective
allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to employees is
recorded against the income statement in the period to which it relates.
R5.Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets approved
by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred taxes relating
to tax losses and to temporary differences between the accounting net income and the net income accepted by the Tax
Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable probability that these taxes
will be paid or recovered in the future.
Income tax registered in net income for the year comprises current and deferred tax effects. Income tax is recognised
in the income statement, except when related to items recognised directly in equity, which implies its recognition in
equity. Deferred taxes arising from the revaluation of financial assets at fair value through other comprehensive income
and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are recognised after in the income
statement at the moment the profit and loss that originated the deferred taxes are recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for tax
purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor taxable
profit and differences relating to investments in subsidiaries to the extent that probably they will not reverse in the
foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairments not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairments will be deductible
for the purposes of determining taxable income for the tax periods in which the legal conditions required for their tax
deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if: (i)
it has a legally enforceable right to offset current tax assets and current tax liabilities; and, (ii) the deferred tax assets
and the deferred tax liabilities relate to income taxes released by the same Tax Authority on either the same taxable
entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred any material impact on the Bank\u2019s financial statements
resulting from its application.
In 2016, the Bank adhered to the Special Tax Regime for Groups of Companies (RETGS) for the purposes of IRC taxation,
with BCP being the dominant entity. In the financial years of 2022 and 2021, RETGS application was maintained. In
2021, Millennium bcp Participa\u00e7\u00f5es Sociais \u2013 Sociedade Unipessoal, Lda. and BCP \u00c1frica, SGPS, Lda., were included in
the group of companies covered by this regime, being now covered by the general IRC regime. The group's taxable
profit is calculated by the algebraic sum of taxable profits and individual tax losses of the companies that integrate it.
T.Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by operating and
geographic segments. A business segment is a Group's component: (i) which develops business activities that can obtain
revenues or expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking
decisions about allocating resources to the segment and assess its performance; and, (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013Retail Banking, also including ActivoBank;
\u2013Companies, Corporate and Investment Banking;
\u2013Private Banking;
\u2013Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralized management of financial investments, corporate activities, and insurance activity.
Foreign activity:
\u2013Poland;
\u2013Mozambique;
\u2013Other.
The \"Other\" segment (foreign activity) includes the activity arising from the discontinued operations in Switzerland and
Cayman Islands (operation liquidated in 2022) and also the contribution of the participation in an associate in Angola. It
should be noted that, following the sale of the operation in Switzerland on 2 November 2021, the subsidiary's net
income in December 2021and the capital gain generated with the sale of the entire shareholding in Banque Priv\u00e9e BCP
(as well as the adjustments occurred in 2022), are reflected as income arising from discontinued operations, as
provided for in IFRS 5.
U.Provisions, Contingent liabilities and Contingent assets
U1.Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and, (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganizations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognized for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected cost,
the most likely result of current actions and considering the risks and uncertainties inherent to the process result. On
the cases that the discount effect is material, provision corresponds to the actual value of the expected future
payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted through
profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the case
that these obligations cease to exist.
U2.Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow of
resources is probable.
U3.Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the possibility
of an outflow of resources regarding economic benefits is not remote. The Group registers a contingent liability when:
i)it is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non- occurrence of one or more uncertain future events that are not wholly within the control of the Group; or,
ii)it is a present obligation that arises from past events but is not recognised because:
a)it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b)the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
V.Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares purchased
by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to consider
conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as dilutive when
their conversion to shares would decrease net earnings per share. If the earnings per share are changed because of an
issue with premium or discount or other event that changed the potential number of ordinary shares or because of
changes in the accounting policies, the earnings per share for all presented periods should be adjusted retrospectively.
W.Insurance contracts
W1.Classification
The Group issues contracts that contain insurance risk, financial risk or a combination of both insurance and financial
risk. A contract, under which the Group accepts significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in accordance with
the accounting policies applicable to insurance contracts. A contract issued by the Group that transfers only financial
risk, without discretionary participating features, is accounted for as a financial instrument.
W2.Recognition and measurement
Premiums of life insurance and investment contracts with discretionary participating features, which are considered as
long-term contracts are recognised as income when due from the policyholders. The benefits and other costs are
recognised concurrently with the recognition of income over the life of the contracts. This specialization is achieved
through the establishment of provisions/liabilities of insurance contracts and investment contracts with discretionary
participating features.
The responsibilities correspond to the present value of future benefits payable, net of administrative expenses directly
associated with the contracts, less the theoretical premiums that would be required to comply with the established
benefits and related expenses. The liabilities are determined based on assumptions of mortality, costs of management
or investment at the valuation date.
For contracts where the payment period is significantly shorter than the period of benefit, premiums are deferred and
recognised as income in proportion to the duration period of risk coverage. Regarding short-term contracts, including
contracts of non-life insurance, premiums are recorded at the time of issue. The award is recognised as income
acquired on a pro-rata basis during the term of the contract. The provision for unearned premiums represents the
amount of issued premiums on risks not occurred.
W3.Premiums
Issued gross premiums are recognised for as income in the period to which they respect independently from the
moment of payment or receivable, in accordance with the accrual accounting principle. Reinsurance premiums ceded
are accounted for as expense in the period to which they respect in the same way as gross premiums written.
W4.Provision for unearned premiums from direct insurance and reinsurance premiums ceded
The provision for unearned gross premiums is based on the evaluation of the premiums written before the end of the
year but for which the risk period continues after the year end. This provision is calculated using the pro-rata temporis
method applied to each contract in force.
W5.Liability adequacy test
At each reporting date, the Group evaluates the adequacy of liabilities arising from insurance contracts and investment
contracts with discretionary participating features. The evaluation of the adequacy of responsibilities is made based on
the projection of future cash flows associated with each contract, discounted at market interest rate without risk. This
evaluation is done product by product or aggregate of products when the risks are similar or managed jointly. Any
deficiency, if exists, is recorded in the Group's results as determined.
X.Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorized by Autoridade de Supervis\u00e3o de Seguros e
Fundos de Pens\u00f5es (ASF) for the practice of insurance intermediation in the category of Linked Insurance Broker, in
accordance with Article 8, paragraph a), subparagraph i) of Decree-Law no. 144/2006, of 31 July, carrying out
insurance intermediation activities in life and non-life segments.
Within the scope of insurance intermediation services, these banks perform the sale of insurance contracts. As
compensation for insurance intermediation services, they receive commissions for arranging insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurance Companies.
Commissions received for insurance intermediation are recognised in accordance with the accrual accounting principle,
so the commissions whose receipt occurs at a different time from the period to which they refer are recognised as an
amount receivable under the item \"Other assets\". Commissions received for insurance mediation services are recognized
in accordance with the policy described in note I. Recognition of income from services and commissions.
Y.Accounting estimates and judgments in applying accounting policies
IFRS set forth a range of accounting treatments that require the Board of Directors, under advice of the Executive
Committee, to apply judgments and to make estimations when deciding which treatment is the most appropriate.
These estimates were made considering the best information available at the date of preparation of the consolidated
financial statements, considering the context of uncertainty that results from the current economic scope. The most
significant of these accounting estimates and judgments used when applying accounting principles are discussed in this
section to improve understanding of how they affect the Group\u2019s reported results and related disclosure.
Considering that in some cases there are several alternatives to the accounting treatment chosen by the Board of
Directors, under advice of the Executive Committee, the Group\u2019s reported results would differ if a different treatment
was chosen. The Executive Committee believes that the choices made are appropriate and that the financial
statements present the Group\u2019s financial position and results fairly in all material relevant aspects.
The alternative outcomes discussed below are presented solely to assist the reader in understanding the financial
statements and are not intended to suggest that other alternatives or estimations would be more appropriate.
Y1.Entities included in the consolidation perimeter
For the purposes of determining entities to include in the consolidation perimeter, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession of
these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by the
Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is exposed to
the variable returns and its ability to use its power to affect these returns. Different estimations and assumptions could
lead the Group to a different scope of consolidation perimeter with a direct impact in consolidated income.
Y2.Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax determination
is uncertain during the ordinary course of business. Different interpretations and estimations could result in a different
level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in which
the Group considers projections of future taxable income based on a set of assumptions, including the estimate of
income before tax, adjustments to taxable income, evolution of tax legislation and its interpretation. Thus, the
recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors strategy, namely
the ability to generate the estimated taxable income, the evolution of tax law and its interpretation.
Regarding the activity in Portugal, Regulatory Decrees no. 5/2016, of 18 November, no. 11/2017, of 28 December, and
no. of impairment losses and other value corrections for specific credit risk deductible for the purposes of calculating
taxable income based on IRC in the years 2016, 2017 and 2018, respectively. These Regulatory Decrees establish that
Bank of Portugal Notice No. 3/95 (Notice that was relevant for the determination of loan provisions in the financial
statements presented in NCA) must be considered for the purposes of calculating the maximum limits of impairment
losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
Law No. 98/2019, of September 4, established the tax regime for credit impairments and provisions for guarantees for
tax periods beginning on or after January 1, 2019, providing for approximation between accounting rules and tax for
the purposes of deductibility of expenses with the strengthening of credit impairments. The rules in force until 2018
could continue to be applied until the end of the 2023 financial year, unless the option to apply the new regime was
exercised in advance.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, the Bank exercised the option to apply the new regime, under the terms of which the impairment
losses for credit risk relating to exposures analysed on an individual basis or on a collective basis recognized in
accordance with applicable accounting standards and regulations, maintaining the rules in force until 2018 for the
balance of impairment losses and other value adjustments for specific credit risk recorded up to 31 December 2021.
Following the amendments provided for in Law No. 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This amendment
applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax losses calculated in
tax periods prior to January 1, 2023 and whose deduction period is still in progress on that date. Thus, tax losses
calculated in 2014 and subsequent years may be deducted from future taxable income. The deduction limit for tax
losses increased from 70% to 65%, being increased by ten percentage points when the difference results from the
deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of the special regime provided for
in Law n. 27-A/2020, of 24 July 24.
In the projections of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2022, the approximation between the accounting and tax rules
provided for in the aforementioned Law n.\u00ba 98/2019 was considered, of 4 September, taking into account the option for
applying the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the
use of tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any deduction or tax credit being
used, in which the expiry period is the exercise of that right. The Bank recorded provisions or liabilities for deferred
taxes in the amount it considers appropriate to cover tax corrections or tax losses incurred, as well as contingencies
relating to years not yet reviewed by the tax authorities.
Y4.Non-current assets held for sale (real estate) valuation
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Bank's historical experience in the commercialization of real estate, its perspectives on the evolution
of the real estate market and the intentions of the management body regarding the commercialization of these assets.
The assumptions used in the valuations of these assets have an impact on their valuation and consequently on the
determination of impairment.
Y5.Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
projections, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
As defined by IAS 19, the discount rate used to update the responsibilities of the Bank's pension fund is based on an
analysis performed over the market yields regarding a bond issues universe \u2013 that the Group considers having high
quality (low risk), different maturities (appropriate to the period of liquidation of the fund's liabilities) and
denominated in euros - related to a diverse and representative range of issuers.
Y6.Financial instruments \u2013 IFRS 9
Y6.1.Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and interest
on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed together to
achieve a specific business objective. This evaluation requires judgment, since the following aspects, among others,
must be considered: the way in which the performance of assets is evaluated; the risks that affect the performance of
the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other comprehensive
income that are derecognised prior to their maturity to understand the underlying reasons for their disposal and to
determine whether they are consistent with the purpose of the business model defined for these assets. This monitoring
is part of a process of continuous evaluation by the Group of the business model of the financial assets that remain in
the portfolio, to determine if it is adequate and, if it is not, if there was a change in the business model and,
consequently, a prospective classification change of these financial assets.
Y6.2.Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
Y6.3.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7. Provisions for risk associated with mortgage loans indexed to the Swiss franc
The Group creates provisions for legal contingencies related to mortgage loans indexed to the Swiss franc granted by
Bank Millennium, S.A.
The assumptions used by the Bank are essentially based on historical observations and will have to be updated in
subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The methodology developed by
the Bank is based on the following parameters: (i) the number of current (including class actions) and potential future
court cases that will appear within a specified time horizon; (ii) the amount of the Bank\u2019s potential loss in the event of
a specific court judgment (three negative judgment scenarios were taken into account); (iii) the probability of
obtaining a specific court verdict calculated on the basis of statistics of judgments of the banking sector in Poland and
legal opinions obtained; (iv) in the case of a loan agreement invalidity scenario, the Bank Millennium's loss is calculated
taking into account the assignment of a minimum probability of receiving the settlement of a remuneration for the cost
of use of capital; and (v) amicable settlement with clients in or out of court.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the swiss franc and the
amount of the Bank\u2019s actual losses depend, namely, on the number of ongoing and potential lawsuits, as well as on the
final court decisions about each case and amicable settlement with clients.
\u00a0 \u00a0 Z. Subsequent events
The Group analyses events occurred after the balance sheet date, i.e., favourable and/or unfavourable events that
occur between the balance sheet date and the date the financial statements were authorized for issue. In this context,
two types of events can be identified:
i)those that provide evidence of conditions that existed at the balance sheet date (events after the balance sheet
date that give rise to adjustments); and,
ii)those that are indicative of the conditions that arose after the balance sheet date (events after the balance sheet
date that do not give rise to adjustments).
Events occurred after the date of the financial statements that are not considered as adjustable events, if significant,
are disclosed in the notes to the consolidated financial statements.
Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Dividends from financial assets held for trading
\u2014
6
Dividends from financial assets through other comprehensive income
10,086
932
10,086
938
The balances Dividends from financial assets through other comprehensive income include in 2022 dividends from
shares of Octal Group Lda in the amount of Euros 7,950,000 and of Tiicc, Sarl in the amount of Euros 1,325,000. This
balance also includes income from investment fund units received during the year.
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Fees and commissions received
Banking services provided
484,454
447,002
Management and maintenance of accounts
170,372
149,847
Bancassurance
121,824
119,395
Securities operations
70,775
67,192
Guarantees granted
46,834
44,171
Commitments to third parties
5,195
5,307
Management and intervention commissions
23,624
22,779
Fiduciary and trust activities
31
\u2014
Other commissions
20,665
19,571
943,774
875,264
Fees and commissions paid
Banking services provided by third parties
(132,751)
(114,476)
Securities operations
(8,991)
(8,514)
Guarantees received
(7,699)
(1,954)
Other commissions
(22,425)
(22,597)
(171,866)
(147,541)
771,908
727,723
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
Other operating income / (losses)
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
adjustments due to derivatives and intra group liabilities and on a risk factor adjustment that depends on the risk
profile of the institution.
In accordance with Article 67(4) of SRM Regulation and in accordance with the Intergovernmental Agreement on the
transfer and mutualisation of contributions to the SRF, the ex-ante contributions are collected by national resolution
authorities and transferred to the SRF by 30 June of each year.
The Group delivered in 2022 the amount of Euros 25,847,000 to the Single Resolution Fund (2021: Euros 20,886,000).
The total value of the contribution attributable to the Group amounted to Euros 30,400,000 (2021: Euros 24,563,000)
and the Group opted to constitute an irrevocable commitment, through the constitution of a bailment for this purpose,
in the amount of Euros 4,553,000 (2021: Euros 3,677,000), not having this component been recognised as a cost, as
defined by the Single Resolution Council in accordance with the methodology set out in Delegated Regulation (EU) No
2015/63 of the Commission of 21 October 2014 and with the conditions laid down in the Implementing Regulation (EU)
2015/81 of the Council of 19 December 2014. As at 31 December 2022, the total amount of irrevocable commitments
constituted is Euros 25,506,000 (31 December 2021: Euros 20,953,000), registered in Other assets - Deposit account
applications (note 32).
The balance Institutional protection scheme (Poland), corresponds to the contribution of Bank Millennium to the
recently created polish Institutional Protection Scheme.
The Management Board of the Bank Millennium S.A. received information on 7 June 2022, that the Management Boards
and Supervisory Boards of Alior Bank S.A., Bank Millennium S.A. Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska
S.A., ING Bank \u015al\u0105ski S.A., mBank S.A., Powszechna Kasa Oszcz\u0119dno\u015bci Bank Polski S.A., Santander Bank Polska S.A.
(Member Banks) had passed resolutions on consenting to submitting an application to the Polish Financial Supervision
Authority for approval and recognition of the protection scheme, the members of which are banks operating in the form
of a joint-stock company together with the draft agreement on the protection scheme, i.e. Member Bank\u2019s
participation in the creation of the protection scheme referred to in Article 4 no.1(9a) of the Banking Law Act of 29
August 1997.
The objective of the protection scheme is to:
1. ensure liquidity and solvency of the Member Banks on the terms and conditions and to the extent set out in the
agreement on the protection scheme; and
2. support: a) the resolution procedure pursued by the Bank Guarantee Fund (BGF) for the bank being a joint-stock
company; and b) acquisition of the bank being a joint-stock company under Article 146b.1 of the Banking Law.
Staff costs
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Remunerations
470,285
455,246
Mandatory social security charges
Post-employment benefits (note 50)
Service cost
(11,727)
(14,466)
Net interest cost / (income) in the liability coverage balance
(5,929)
4,428
Cost with early retirement programs
2,223
36,583
Amount transferred to the Fund resulting from acquired rights
unassigned related to the Complementary Plan
(6)
(586)
(15,439)
25,959
Other mandatory social security charges
104,784
73,183
89,345
99,142
Voluntary social security charges
12,326
11,195
Other staff costs
8,851
88,687
580,807
654,270
The balance Remunerations includes in 2022 the amount of Euros 5,630,000 related to the distribution of profits to
Bank's employees. In 2021, there was no distribution of profits to Bank's employees.
In November 2022, the Bank decided to award an extraordinary payment of Euros 500 to all employees without an
assigned vehicle, which amounted to Euros 2,869,000 reflected in the balance Remunerations. This measure aimed to
contribute to the mitigation of the impact of the current inflationary conjuncture on employees' income.
In 2022, the Bank accounted for in Other costs the amount of Euros 4,414,000 (2021: Euros 84,152,000), referring to
agreements already concluded with some employees whose effective departures will occur during the first half of 2023
(note 39).
This balance also included severance payments in the amount of 1,588,000 (2021: Euros 4,219,000), of which the
highest amounted to Euros 217,000 (2021: Euros 886,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by category:
2022
2021
Portugal
Top Management
854
882
Intermediary Management
1,416
1,508
Specific/Technical functions
2,867
2,976
Other functions
1,119
1,398
6,256
6,764
Abroad
9,314
9,809
15,570
16,573
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories of
employees provided for in Article 115 C no. 2 of the RGICS, as well as the information provided for in Article 450 g) to i)
of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial Portugu\u00eas,
S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2022
2021
2022
2021
Fixed remuneration
3,055
3,055
1,856
1,915
Variable remuneration
Pecuniary
370
246
\u2014
\u2014
Shares
1,322
172
\u2014
\u2014
Deferred
1,024
138
\u2014
\u2014
Supplementary retirement pension
611
611
138
138
Post-employment benefits
(42)
(1)
\u2014
\u2014
Other mandatory social security charges
734
733
443
457
7,074
4,954
2,437
2,510
Number of beneficiaries
6
6
11
11
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity contract,
intends to compensate the functions that are performed in the Bank and in all other functions performed in subsidiaries
or governing bodies for which they have been designated by indication or in representation of the Bank, in the latter
case, the net amount of the remuneration annually received by each member of the Executive Committee will be
deducted from the fixed annual remuneration attributed by the Bank, ensuring that the effective payable amount
corresponds to the one approved by the Remuneration and Welfare Board.
In 2022, the amount of remuneration paid to the Executive Committee includes the amount of Euros 101,000 (2021:
Euros 108,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was Euros 26,000 (2021: Euros 33,000).
In 2022, it was assigned variable remuneration in accordance with the remuneration policies for the members of the
management and supervisory bodies and for employees, approved for 2021, as described in accounting policies 1 R4 and
1 R5.
In 2022, the variable remuneration attributed was Euros 616,000 in cash, of which Euros 246,000 are deferred for 5
years, and 12,416,223 shares corresponding to Euros 2,567,000, of which 1,568,846 shares are deferred for 5 years, and
3,397,643 shares are deferred for 3 years.
In 2021, the deferred variable remuneration attributed to the Executive Committee related to 2020, was Euros 164,000
in cash and 807,882 BCP shares.
In 2022 the deferred variable remuneration from 2021, 2020 and 2019 attributed to the Executive Committee is related
to 2020, 2019 and 2018 years respectively, and amounts to Euros 590,000 in cash and 2,443,549 BCP shares in the
amount of Euros 434,000.
In 2021, the 2019 deferred variable remuneration paid to the Executive Committee relates to the 2018 financial year
and it includes the amount of Euros 89,000 and 347,432 BCP shares in the amount of Euros 49,000.
During 2022 and 2021, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
In 2022, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2022
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,317
2,657
453
2,474
5,041
11,942
Variable remuneration
Pecuniary
129
176
43
224
448
1,020
Shares
80
105
19
139
261
604
Deferred
48
42
9
20
120
239
Post-employment benefits
(112)
(108)
(7)
(191)
(366)
(784)
Other mandatory social security
charges
331
547
111
649
1,209
2,847
1,793
3,419
628
3,315
6,713
15,868
Number of beneficiaries
9
15
2
26
38
90
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2021, as
described in accounting policies 1 R4 and 1 R5, in 2022, the 90 Key Function Holders were awarded with variable
remuneration, in the amount of Euros 236,000 in cash and 1,534,941 shares deferred for 5 years, as well as 174
participation units from AF Fund deferred for 3 years.
In 2022, deferred variable remunerations were paid to KFH deferred from 2021, 2020 and 2019 years, corresponding in
cash to Euros 57,000 and shares in the amount of Euros 182,000.
In 2022, severance payments were paid to 3 KFH in the amount of Euros 255,000, of which the highest payment was
Euros 200,000.
In 2021, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2021
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,188
2,873
450
2,100
4,513
11,124
Variable remuneration
Pecuniary
28
46
6
57
119
256
Shares
20
27
4
29
73
153
Deferred
31
34
6
15
93
179
Post-employment benefits
(76)
(20)
13
(78)
(214)
(375)
Other mandatory social security
charges
292
741
109
530
1,116
2,788
1,483
3,701
588
2,653
5,700
14,125
Number of beneficiaries
8
16
2
22
37
85
As described in accounting policies 1.R4 and 1.R5, during 2021, the 85 Key Function Holders were awarded variable
remuneration arising from the application of the Remuneration Policies for Employees, approved for the financial year
2020, which will be deferred over a period of 5 years, in the amount of Euros 229,000.
In 2021, deferred variable remuneration was paid to KFH deferred from 2020 and 2019, corresponding in cash to Euros
42,000 and shares in the amount of Euros 137,000.
In 2021, severance payments were paid to 3 KFH in the amount of Euros 1,327,000 of which the highest amounts to
Euros 886,000.
In 2022 and 2021, the remunerations and social security charges supported with the Group's Key Function Holders,
discriminated by Key management members and by members whose professional activities have significant impact in
the risk profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management members
Other KFH
Total
2022
2021
2022
2021
2022
2021
Fixed remuneration
7,865
7,431
4,077
3,693
11,942
11,124
Variable remuneration
Pecuniary
705
170
315
86
1,020
256
Shares
417
111
187
42
604
153
Deferred
230
169
9
10
239
179
Post-employment benefits
(453)
(202)
(331)
(173)
(784)
(375)
Other mandatory social security
charges
1,934
1,840
913
948
2,847
2,788
10,698
9,519
5,170
4,606
15,868
14,125
Number of beneficiaries
53
51
37
34
90
85
The balance Rents and leases includes the amount of Euros 590,000 (2021: Euros 581,000) related to short-term lease
contracts and the amount of Euros 2,402.000 (2021: Euros 2,564,000) related to lease contracts of low-value assets, as
described in the accounting policy 1 H.
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other services,
is analysed as follows:
(Thousands of euros)
2022
2021
Auditing services
Legal certification
3,190
2,947
Other assurance services
1,388
1,269
Other services
310
594
4,888
4,810
above and the currently expected costs, the value of the adjustment recognized in 2022 as Results on modification
amounts to Euros 282,813,000 (PLN 1,324,208,000).
This balance also includes the amount of Euros 27,052,000 relating to contractual modifications made in accordance
with IFRS 9, namely those negotiated with customers holding foreign exchange mortgage loans (note 57).
Impairment of financial assets at amortised cost
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Loans and advances to credit institutions (note 21)
Charge for the year
349
911
Reversals for the year
(673)
(27)
(324)
884
Loans and advances to customers (note 22)
Charge for the year
830,750
861,212
Reversals for the year
(506,926)
(487,084)
Recoveries of loans and interest charged-off
(20,836)
(22,938)
302,988
351,190
Debt securities (note 23)
Associated to credit operations
Charge for the year
8
244
Reversals for the year
(2,393)
(2,533)
(2,385)
(2,289)
Not associated to credit operations
Charge for the year
3,329
4,874
Reversals for the year
(2,779)
(1,826)
550
3,048
(1,835)
759
300,829
352,833
Other provisions
This balance is comprised of:
(Thousands of euros)
2022
2021
Provision for guarantees and other commitments (note 39)
Charge for the year
27,864
44,414
Reversals for the year
(26,939)
(36,278)
925
8,136
Other provisions for liabilities and charges (note 39)
Charge for the year
569,226
651,156
Reversals for the year
(1,854)
(16,566)
567,372
634,590
568,297
642,726
The balance Gains /(Losses) on disposal of other assets includes essentially gains on disposal of assets held by the Group
and classified as non-current assets held for sale which corresponds to a gain of Euros 11,323,000 in 2022 (2021: gain of
Euros 4,719,000).
Net income from discontinued or discontinuing operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Banque Priv\u00e9e BCP (Suisse) S.A.
Net income before taxes
\u2014
1,424
Taxes on net income
\u2014
(223)
Gains arising on disposal of 100% investment held
\u2014
51,093
Gains on disposal of the investment held (price adjustment)
1,765
\u2014
1,765
52,294
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
Net income before taxes
\u2014
9,303
Taxes on net income
\u2014
(2,515)
Gains arising on disposal of investment held (70%)
\u2014
23,736
Correction of gains on disposal of the investment held
3,772
\u2014
Tax on gains arising on disposal
\u2014
(11,937)
3,772
18,587
5,537
70,881
As at 31 December 2022, the Bank's share capital amounts to Euros 3,000,000,000 (2021: Euros 4,725,000,000) and is
represented by 15,113,989,952 nominative book-entry shares without nominal value, fully subscribed and paid up. As
described in note 48, pursuant to the resolutions adopted at the General Meeting held on 20 December 2022, the Bank
registered its new share capital of 3,000,000,000 Euros, maintaining the number of nominatives, book-entry shares
without nominal value and of the voting rights.
There were not identified another dilution effects of the earnings per share as at 31 December 2022 and 2021, so the
diluted result is equivalent to the basic result.
Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Cash
593,033
601,772
Central Banks
Bank of Portugal
3,370,139
6,418,682
Central Banks abroad
2,058,829
775,845
6,022,001
7,796,299
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy the
legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective liabilities.
According to the European Central Bank System for Euro Zone, the cash reserve requirements establish the
maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other liabilities,
during each reserve requirement period. The rate is different for countries outside the Euro Zone.
In addition, from the reserve counting period started on 30 October 2019, the ECB introduced the tiering regime, in
which the balance with the Central Bank in excess of the minimum cash reserves, up to an estimated maximum of 6
times of the reserves, is remunerated at the central bank's lending rate instead of the deposit rate.
Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Credit institutions in Portugal
2,338
24,301
Credit institutions abroad
112,443
278,860
Amounts due for collection
98,679
58,625
213,460
361,786
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in
the respective contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred
operations (IRS and CIRS), whose revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2022
2021
Up to 3 months
752,913
428,202
3 to 6 months
79,247
9,723
6 to 12 months
132,136
7,164
1 to 5 years
\u2014
9,311
964,296
454,400
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,187
304
Transfers
\u2014
(1)
Impairment charge for the year (note 11)
349
911
Reversals for the year (note 11)
(673)
(27)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
862
1,187
Loans and advances to customers
The analysis of loans and advances to customers, by type of credit, is as follows:
(Thousands of euros)
2022
2021
Mortgage loans
28,658,104
28,544,360
Loans
17,672,581
18,298,171
Finance leases
4,176,329
4,155,758
Factoring operations
3,022,248
2,725,080
Current account credits
822,473
817,440
Overdrafts
1,046,121
1,073,654
Discounted bills
201,081
143,109
55,598,937
55,757,572
Overdue loans - less than 90 days
94,063
127,928
Overdue loans - Over 90 days
485,166
936,185
56,178,166
56,821,685
Loans impairment
(1,502,373)
(1,849,284)
54,675,793
54,972,401
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees considered:
\u2013Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable (income
consignment);
\u2013Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal guarantees.
The balance Loans and advances to customers, as at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
635,424
\u2014
635,424
(1,681)
633,743
Asset-backed loans
32,425,246
528,636
32,953,882
(839,830)
32,114,052
Other guaranteed loans
6,182,245
99,957
6,282,202
(226,767)
6,055,435
Unsecured loans
7,423,516
347,056
7,770,572
(541,446)
7,229,126
Foreign loans
2,210,303
8,497
2,218,800
(30,443)
2,188,357
Factoring operations
2,725,080
11,304
2,736,384
(41,967)
2,694,417
Finance leases
4,155,758
68,663
4,224,421
(167,150)
4,057,271
55,757,572
1,064,113
56,821,685
(1,849,284)
54,972,401
As at 31 December 2022, the balance Loans and advances to customers includes the amount of Euros 10,613,589,000
(31 December 2021: Euros 11,896,688,000) regarding mortgage loans assigned to the cover pool backing the Group\u2019s
covered bond programme issuances.
As part of the liquidity risk management, the Group holds a pool of eligible assets that can serve as collateral in funding
operations with the European Central Bank and other Central Banks in countries where the Group operates, which
include loans and advances to customers.
As referred in note 51, the Group provides loans and/or guarantees to qualifying shareholders holding individually or
together with their affiliates, 5% or more of the share capital identified in the Board of Directors report and in note 41.
As at 31 December 2022, the Group granted credit to qualifying shareholders and entities controlled by them, in the
amount of Euros 98,658,000 (31 December 2021: Euros 152,056,000), as referred in note 51 a). The amount of
impairment recognised for these contracts amounts to Euros 914,000 (31 December 2021: Euros 3,140,000).
The conclusion of business between the Company and holders of qualifying holdings or individuals or legal entities
related to them in accordance with the provisions of article 33.\u00ba, n.\u00ba 3 of Notice 3/2020 of Bank of Portugal, regardless
of the amount, is always subject of consideration and deliberation by the Board of Directors, after obtaining a prior
opinion from the Audit Committee, and by proposal of the Executive Committee, which in turn deliberates under
proposal from the Credit Committee, after obtaining an analysis and opinion from the Compliance Office, which
pronounces regarding the compliance of the proposed operations with internal regulations, legal and regulatory
provisions and other conditions that may apply to them, and the Risk Office, which evaluates and issues an opinion on
the risks inherent to the operation.
As at 31 December 2022, the balance Finance leases includes the amount of Euros 348,000 (31 December 2021: Euros
6,938,000) relative to sublease operations, as referred in accounting policy 1 H.
The analysis of the outstanding amount of financial lease contracts, by type of client, is presented as follows:
(Thousands of euros)
2022
2021
Individuals
Home
43,402
48,249
Consumer
27,606
31,359
Others
75,666
83,744
146,674
163,352
Companies
Equipment
1,890,361
1,889,697
Real estate
2,139,294
2,102,709
4,029,655
3,992,406
4,176,329
4,155,758
The analysis of loans and advances to customers, as at 31 December 2022, by sector of activity, is as follows:
(Thousands of euros)
2022
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
461,680
8,517
470,197
(13,879)
456,318
0.84%
Fisheries
25,308
3,226
28,534
(2,563)
25,971
0.05%
Mining
70,970
1,676
72,646
(5,249)
67,397
0.13%
Food, beverage and tobacco
813,359
11,634
824,993
(26,201)
798,792
1.47%
Textiles
497,338
8,989
506,327
(17,109)
489,218
0.90%
Wood and cork
260,175
3,730
263,905
(5,364)
258,541
0.47%
Paper, printing and publishing
148,937
742
149,679
(3,924)
145,755
0.27%
Chemicals
862,826
38,334
901,160
(63,538)
837,622
1.60%
Machinery, equipment and basic
metallurgical
1,526,778
25,298
1,552,076
(56,649)
1,495,427
2.76%
Electricity and gas
229,821
443
230,264
(1,285)
228,979
0.41%
Water
204,736
452
205,188
(8,371)
196,817
0.37%
Construction
1,497,114
21,639
1,518,753
(141,991)
1,376,762
2.70%
Retail business
1,705,882
18,730
1,724,612
(36,848)
1,687,764
3.07%
Wholesale business
2,225,903
26,755
2,252,658
(67,081)
2,185,577
4.01%
Restaurants and hotels
1,505,963
15,721
1,521,684
(71,192)
1,450,492
2.71%
Transports
1,320,236
7,464
1,327,700
(20,751)
1,306,949
2.36%
Post offices
19,918
254
20,172
(412)
19,760
0.04%
Telecommunications
411,885
1,508
413,393
(9,411)
403,982
0.74%
Services
Financial intermediation
2,047,265
2,149
2,049,414
(44,691)
2,004,723
3.65%
Real estate activities
1,978,182
10,931
1,989,113
(35,469)
1,953,644
3.54%
Consulting, scientific and technical
activities
969,410
8,232
977,642
(86,718)
890,924
1.74%
Administrative and support services
activities
532,237
4,296
536,533
(57,220)
479,313
0.96%
Public sector
823,904
\u2014
823,904
(2,545)
821,359
1.47%
Education
143,930
814
144,744
(14,627)
130,117
0.26%
Health and collective service activities
378,423
1,029
379,452
(7,108)
372,344
0.68%
Artistic, sports and recreational
activities
236,543
2,128
238,671
(37,124)
201,547
0.43%
Other services
234,399
2,971
237,370
(101,356)
136,014
0.42%
Consumer loans
5,775,239
237,160
6,012,399
(369,220)
5,643,179
10.70%
Mortgage credit
28,012,946
110,809
28,123,755
(181,551)
27,942,204
50.06%
Other domestic activities
1,377
332
1,709
(38)
1,671
0%
Other international activities
676,253
3,266
679,519
(12,888)
666,631
1.21%
55,598,937
579,229
56,178,166
(1,502,373)
54,675,793
100%
The analysis of loans and advances to customers, as at 31 December 2021, by sector of activity, is as follows:
(Thousands of euros)
2021
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
444,936
6,142
451,078
(10,764)
440,314
0.79%
Fisheries
38,039
1,148
39,187
(2,752)
36,435
0.07%
Mining
87,811
1,943
89,754
(2,038)
87,716
0.16%
Food, beverage and tobacco
806,228
8,326
814,554
(22,048)
792,506
1.43%
Textiles
528,010
9,436
537,446
(17,959)
519,487
0.95%
Wood and cork
274,385
5,520
279,905
(11,116)
268,789
0.49%
Paper, printing and publishing
189,495
605
190,100
(3,799)
186,301
0.34%
Chemicals
841,454
25,028
866,482
(44,219)
822,263
1.53%
Machinery, equipment and basic
metallurgical
1,568,322
30,550
1,598,872
(56,605)
1,542,267
2.81%
Electricity and gas
237,037
837
237,874
(2,515)
235,359
0.42%
Water
223,210
352
223,562
(19,330)
204,232
0.39%
Construction
1,715,141
36,691
1,751,832
(120,633)
1,631,199
3.08%
Retail business
1,772,527
27,490
1,800,017
(52,210)
1,747,807
3.17%
Wholesale business
2,319,324
34,827
2,354,151
(85,691)
2,268,460
4.14%
Restaurants and hotels
1,669,080
16,810
1,685,890
(128,012)
1,557,878
2.97%
Transports
1,349,930
13,804
1,363,734
(37,792)
1,325,942
2.40%
Post offices
18,695
208
18,903
(461)
18,442
0.03%
Telecommunications
437,097
1,773
438,870
(12,275)
426,595
0.77%
Services
Financial intermediation
1,886,333
65,780
1,952,113
(118,938)
1,833,175
3.44%
Real estate activities
1,868,624
11,680
1,880,304
(50,639)
1,829,665
3.31%
Consulting, scientific and technical
activities
879,296
5,301
884,597
(60,492)
824,105
1.56%
Administrative and support services
activities
588,528
6,725
595,253
(64,140)
531,113
1.05%
Public sector
903,437
\u2014
903,437
(2,848)
900,589
1.59%
Education
151,152
1,002
152,154
(13,240)
138,914
0.27%
Health and collective service activities
401,740
1,306
403,046
(15,802)
387,244
0.71%
Artistic, sports and recreational
activities
347,660
42,689
390,349
(108,601)
281,748
0.69%
Other services
229,001
242,691
471,692
(206,320)
265,372
0.83%
Consumer loans
5,599,131
305,938
5,905,069
(391,664)
5,513,405
10.39%
Mortgage credit
27,920,953
151,456
28,072,409
(173,316)
27,899,093
49.40%
Other domestic activities
1,080
707
1,787
(108)
1,679
0.00%
Other international activities
459,916
7,348
467,264
(12,957)
454,307
0.82%
55,757,572
1,064,113
56,821,685
(1,849,284)
54,972,401
100.00%
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31 December 2022, is as
follows:
(Thousands of euros)
2022
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
104,760
181,701
175,219
461,680
8,517
470,197
Fisheries
3,756
12,465
9,087
25,308
3,226
28,534
Mining
17,107
42,103
11,760
70,970
1,676
72,646
Food, beverage and tobacco
408,663
307,334
97,362
813,359
11,634
824,993
Textiles
154,019
265,451
77,868
497,338
8,989
506,327
Wood and cork
92,259
135,429
32,487
260,175
3,730
263,905
Paper, printing and publishing
42,397
76,818
29,722
148,937
742
149,679
Chemicals
335,828
396,647
130,351
862,826
38,334
901,160
Machinery, equipment and basic
metallurgical
559,264
742,898
224,616
1,526,778
25,298
1,552,076
Electricity and gas
55,254
67,104
107,463
229,821
443
230,264
Water
35,418
80,638
88,680
204,736
452
205,188
Construction
524,861
638,536
333,717
1,497,114
21,639
1,518,753
Retail business
668,493
729,772
307,617
1,705,882
18,730
1,724,612
Wholesale business
1,011,781
933,752
280,370
2,225,903
26,755
2,252,658
Restaurants and hotels
81,252
523,536
901,175
1,505,963
15,721
1,521,684
Transports
334,717
840,728
144,791
1,320,236
7,464
1,327,700
Post offices
12,384
6,551
983
19,918
254
20,172
Telecommunications
82,116
274,708
55,061
411,885
1,508
413,393
Services
Financial intermediation
194,026
783,252
1,069,987
2,047,265
2,149
2,049,414
Real estate activities
345,774
830,401
802,007
1,978,182
10,931
1,989,113
Consulting, scientific and technical
activities
211,357
387,691
370,362
969,410
8,232
977,642
Administrative and support services
activities
122,350
278,364
131,523
532,237
4,296
536,533
Public sector
84,965
283,426
455,513
823,904
\u2014
823,904
Education
29,436
47,613
66,881
143,930
814
144,744
Health and collective service activities
70,100
167,080
141,243
378,423
1,029
379,452
Artistic, sports and recreational
activities
11,618
64,764
160,161
236,543
2,128
238,671
Other services
70,922
121,649
41,828
234,399
2,971
237,370
Consumer loans
1,901,816
2,744,264
1,129,159
5,775,239
237,160
6,012,399
Mortgage credit
464,882
1,593,206
25,954,858
28,012,946
110,809
28,123,755
Other domestic activities
247
477
653
1,377
332
1,709
Other international activities
432,937
81,442
161,874
676,253
3,266
679,519
8,464,759
13,639,800
33,494,378
55,598,937
579,229
56,178,166
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31 December 2021, is as
follows:
(Thousands of euros)
2021
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
105,704
161,400
177,832
444,936
6,142
451,078
Fisheries
5,753
14,677
17,609
38,039
1,148
39,187
Mining
16,303
58,651
12,857
87,811
1,943
89,754
Food, beverage and tobacco
359,259
332,183
114,786
806,228
8,326
814,554
Textiles
137,952
277,945
112,113
528,010
9,436
537,446
Wood and cork
99,291
131,284
43,810
274,385
5,520
279,905
Paper, printing and publishing
75,064
74,969
39,462
189,495
605
190,100
Chemicals
267,511
412,437
161,506
841,454
25,028
866,482
Machinery, equipment and basic
metallurgical
521,463
759,272
287,587
1,568,322
30,550
1,598,872
Electricity and gas
48,354
66,317
122,366
237,037
837
237,874
Water
31,754
57,684
133,772
223,210
352
223,562
Construction
510,600
742,757
461,784
1,715,141
36,691
1,751,832
Retail business
668,955
756,484
347,088
1,772,527
27,490
1,800,017
Wholesale business
914,425
1,082,909
321,990
2,319,324
34,827
2,354,151
Restaurants and hotels
88,460
512,541
1,068,079
1,669,080
16,810
1,685,890
Transports
292,026
692,834
365,070
1,349,930
13,804
1,363,734
Post offices
11,885
5,976
834
18,695
208
18,903
Telecommunications
87,200
273,315
76,582
437,097
1,773
438,870
Services
Financial intermediation
213,955
401,976
1,270,402
1,886,333
65,780
1,952,113
Real estate activities
316,696
819,454
732,474
1,868,624
11,680
1,880,304
Consulting, scientific and technical
activities
174,787
312,648
391,861
879,296
5,301
884,597
Administrative and support services
activities
146,087
272,501
169,940
588,528
6,725
595,253
Public sector
78,613
349,831
474,993
903,437
\u2014
903,437
Education
29,090
50,130
71,932
151,152
1,002
152,154
Health and collective service activities
67,409
166,250
168,081
401,740
1,306
403,046
Artistic, sports and recreational
activities
48,141
54,849
244,670
347,660
42,689
390,349
Other services
75,324
83,111
70,566
229,001
242,691
471,692
Consumer loans
1,772,975
2,675,033
1,151,123
5,599,131
305,938
5,905,069
Mortgage credit
483,741
2,017,730
25,419,482
27,920,953
151,456
28,072,409
Other domestic activities
250
402
428
1,080
707
1,787
Other international activities
215,105
98,822
145,989
459,916
7,348
467,264
7,864,132
13,716,372
34,177,068
55,757,572
1,064,113
56,821,685
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31 December 2022, is as
follows:
(Thousands of euros)
2022
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
21,138
19,832
543,029
583,999
\u2014
583,999
Asset-backed loans
1,608,240
3,615,091
27,010,051
32,233,382
123,063
32,356,445
Other guaranteed loans
842,171
3,866,580
958,781
5,667,532
100,085
5,767,617
Unsecured loans
2,660,372
3,452,035
1,345,905
7,458,312
258,186
7,716,498
Foreign loans
171,535
785,272
1,500,328
2,457,135
2,451
2,459,586
Factoring operations
2,592,313
426,935
3,000
3,022,248
16,680
3,038,928
Finance leases
568,990
1,474,055
2,133,284
4,176,329
78,764
4,255,093
8,464,759
13,639,800
33,494,378
55,598,937
579,229
56,178,166
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31 December 2021, is as
follows:
(Thousands of euros)
2021
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
24,756
28,028
582,640
635,424
\u2014
635,424
Asset-backed loans
1,638,995
3,843,990
26,942,261
32,425,246
528,636
32,953,882
Other guaranteed loans
811,185
3,992,200
1,378,860
6,182,245
99,957
6,282,202
Unsecured loans
2,480,837
3,515,890
1,426,789
7,423,516
347,056
7,770,572
Foreign loans
129,608
377,963
1,702,732
2,210,303
8,497
2,218,800
Factoring operations
2,217,684
507,242
154
2,725,080
11,304
2,736,384
Finance leases
561,067
1,451,059
2,143,632
4,155,758
68,663
4,224,421
7,864,132
13,716,372
34,177,068
55,757,572
1,064,113
56,821,685
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2022
2021
Stage 1
Gross amount
46,404,751
46,115,097
Impairment
(214,469)
(207,328)
46,190,282
45,907,769
Stage 2
Gross amount
7,567,944
7,969,921
Impairment
(284,653)
(283,657)
7,283,291
7,686,264
Stage 3
Gross amount
2,205,471
2,736,666
Impairment
(1,003,251)
(1,358,298)
1,202,220
1,378,368
54,675,793
54,972,401
The exposure and impairment of the above table also includes the operations classified as POCI as detailed in note 54.
The analysis of the exposure covered by collaterals associated with loans and advances to customers' portfolio, by stage
according with IFRS 9, considering the collaterals' fair value, is as follows:
(Thousands of euros)
2022
2021
Stage 1
Securities and other financial assets
1,533,809
1,253,189
Residential real estate
24,796,864
23,489,794
Other real estate
3,475,795
3,182,387
Other guarantees
7,654,261
6,961,806
37,460,729
34,887,176
Stage 2
Securities and other financial assets
192,025
268,388
Residential real estate
2,507,458
2,645,791
Other real estate
1,158,362
1,551,993
Other guarantees
1,744,218
1,715,619
5,602,063
6,181,791
Stage 3
Securities and other financial assets
28,765
71,291
Residential real estate
432,138
540,907
Other real estate
516,903
578,807
Other guarantees
235,900
404,485
1,213,706
1,595,490
44,276,498
42,664,457
consequent establishment of a new funding to replace the previous and which arise to the marking of operations as
being restructured due to financial difficulties of customers. The restructuring may include in a reinforce of
guarantees, liquidation of part of the credit as well as changes in the payment plan and/or in interest rate. The
analysis of the restructured loans, by sector of activity, is as follows:
(Thousands of euros)
2022
2021
Restructured
loans
Impairment
(*)
Net amount
Restructured
loans
Impairment
(*)
Net amount
Agriculture and forestry
15,009
(2,216)
12,793
12,408
(2,838)
9,570
Fisheries
2,772
(1,762)
1,010
3,705
(1,568)
2,137
Mining
1,305
(199)
1,106
10,360
(275)
10,085
Food, beverage and tobacco
28,393
(10,112)
18,281
26,556
(7,468)
19,088
Textiles
14,120
(4,981)
9,139
14,877
(4,336)
10,541
Wood and cork
6,088
(784)
5,304
7,030
(1,034)
5,996
Paper, printing and publishing
8,698
(1,701)
6,997
6,911
(1,825)
5,086
Chemicals
30,146
(11,809)
18,337
27,056
(8,744)
18,312
Machinery, equipment and basic
metallurgical
74,637
(22,688)
51,949
79,015
(16,826)
62,189
Electricity and gas
1,133
(255)
878
603
(113)
490
Water
1,767
(734)
1,033
14,812
(9,673)
5,139
Construction
151,970
(94,787)
57,183
183,645
(74,672)
108,973
Retail business
38,861
(10,085)
28,776
42,916
(13,218)
29,698
Wholesale business
68,474
(13,627)
54,847
86,149
(14,276)
71,873
Restaurants and hotels
97,002
(16,126)
80,876
130,031
(17,508)
112,523
Transports
9,620
(1,767)
7,853
9,945
(2,001)
7,944
Post offices
125
(33)
92
149
(56)
93
Telecommunications
25,228
(4,066)
21,162
28,566
(5,225)
23,341
Services
Financial intermediation
54,764
(19,879)
34,885
144,402
(76,108)
68,294
Real estate activities
45,785
(9,927)
35,858
96,019
(15,212)
80,807
Consulting, scientific and technical
activities
190,444
(63,606)
126,838
205,449
(33,369)
172,080
Administrative and support services
activities
67,941
(46,519)
21,422
72,439
(45,569)
26,870
Public sector
63,016
(427)
62,589
58,940
(307)
58,633
Education
17,310
(11,358)
5,952
20,357
(10,415)
9,942
Health and collective service
activities
8,428
(1,206)
7,222
29,690
(7,853)
21,837
Artistic, sports and recreational
activities
19,732
(8,865)
10,867
166,973
(91,547)
75,426
Other services
11,855
(1,601)
10,254
249,210
(176,099)
73,111
Consumer loans
274,500
(99,459)
175,041
273,902
(93,134)
180,768
Mortgage credit
535,948
(69,129)
466,819
555,922
(55,970)
499,952
Other domestic activities
\u2014
\u2014
\u2014
48
(26)
22
Other international activities
977
(594)
383
5,910
(5,169)
741
1,866,048
(530,302)
1,335,746
2,563,995
(792,434)
1,771,561
(*)The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology
described in point i. of the section \"Additional measures with impact on the Impairment level\" of note 54.
The breakdown of the restructured loans as at 31 December 2022, by restructuring measure, is as follows:
(Thousands of euros)
2022
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
40,796
383,529
64,104
447,633
(130,635)
316,998
Introduction of the grace period for
capital and / or interest
7,359
433,555
30,187
463,742
(134,502)
329,240
Interest rate reduction
3,933
147,583
5,694
153,277
(105,411)
47,866
Payment plan change
10,832
233,879
9,338
243,217
(21,762)
221,455
Debt relief
105
935
1,693
2,628
(1,391)
1,237
Debt-asset swaps
4
368
21
389
(31)
358
Other restructured loans
6,877
507,410
47,752
555,162
(136,570)
418,592
69,906
1,707,259
158,789
1,866,048
(530,302)
1,335,746
The breakdown of the restructured loans as at 31 December 2021, by restructuring measure, is as follows:
(Thousands of euros)
2021
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
39,767
614,627
76,723
691,350
(149,925)
541,425
Introduction of the grace period for
capital and / or interest
6,303
459,222
352,001
811,223
(352,912)
458,311
Interest rate reduction
4,949
248,877
11,085
259,962
(130,692)
129,270
Payment plan change
9,826
287,763
7,813
295,576
(28,135)
267,441
Debt relief
289
1,630
5,692
7,322
(5,055)
2,267
Debt-asset swaps
7
441
1,270
1,711
(1,318)
393
Other restructured loans
10,263
425,088
71,763
496,851
(124,397)
372,454
71,404
2,037,648
526,347
2,563,995
(792,434)
1,771,561
(*) The impairment presented in the tables does not include the amounts of impairment calculated using the overlays methodology described in
point i. of the section \"Additional measures with impact on the Impairment level\" of note 54.
The restructured loans are also subject to an impairment analysis resulting from the revaluation of expectation to meet
new cash flows inherent to the new contract terms and considering new collaterals.
The Group has implemented a process for marking operations restructured due to clients' financial difficulties. This
marking is part of the credit analysis process, being in charge of the respective decision-making bodies, according to
the corresponding competencies, established in the regulations in force.
The information on operations restructured due to financial difficulties is available in the Group's information systems,
having a relevant role in the processes of credit analysis, in the marking of customers in default and in the process of
determining impairment. In particular:
- there are several default triggers related to restructuring due to financial difficulties (restructuring with loss of value,
recidivism of restructuring, default on customers with restructured operations);
- in the process of individual impairment analysis, in addition to the existence of operations restructured due to
financial difficulties, being a reason for customer selection, the loss inherent to the change in the conditions resulting
from the restructuring is determined.
The demarcation of an operation marked as restructured due to financial difficulties, can only take place at least 2
periods after the date of marking, provided that a set of conditions exist that allow to conclude by the improvement of
the financial condition of the client. In the case of credits marked as Non-Performing Exposure (NPE), this 2-year period
will only start on the date of classification of the credit as performing.
The definition of Non-Performing Loans for more than 90 days (NPL > 90) incorporates total credit (past due plus
outstanding) associated with past due operations for more than 90 days. As at 31 December 2022, the amount
calculated is Euros 725,300,000 (31 December 2021: Euros 1,236,979,000).
All customers who check at least one of the following conditions are marked in default and therefore as NPE:
- Material payment delay of more than 90 days in the amounts of principal, interest or unpaid commissions on the due
date that, cumulatively, represent: more than 100 euros (retail) or more than 500 euros (non-retail); and more than 1%
of the total debt (direct liabilities).
- Indications of low probability of payment:
a) Credit restructuring due to financial difficulties with loss of value; b) Delay after restructuring due to financial
difficulties; c) Recurrence of restructuring due to financial difficulties; d) Credit with signs of impairment (or Stage 3 of
IFRS 9); e) Insolvency or equivalent process; f) Litigation; g) Guarantees of operations in default; h) Loss of credit sales;
i) Credit fraud; j) Unpaid credit status; k) Breach of covenants in a credit agreement; l) Contagion of default in an
economic group; m) Cross default in the BCP Group.
As at 31 December 2022, the NPE associated with Loans and advances customers at amortized cost amounts to Euros
2,205,471,000 (31 December 2021: Euros 2,736,666,000).
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,849,284
2,036,522
Charge for the year in net income interest
32,942
25,935
Transfers resulting from changes in the Group's structure
\u2014
(375)
Other transfers
(53,634)
4,778
Impairment charge for the year (note 11)
830,750
861,212
Reversals for the year (note 11)
(506,926)
(487,084)
Loans charged-off
Write-offs
(458,405)
(372,710)
Credit assignments
(189,061)
(227,470)
Exchange rate differences
(2,577)
8,476
Balance at the end of the year
1,502,373
1,849,284
The analysis of recovered loans and interest occurred during 2022 and 2021, by sector of activity, is as follows:
(Thousands of euros)
2022
2021
Agriculture and forestry
6
159
Mining
\u2014
97
Food, beverage and tobacco
34
95
Textiles
41
245
Wood and cork
43
26
Paper, printing and publishing
\u2014
2
Chemicals
105
673
Machinery, equipment and basic metallurgical
165
1,216
Electricity and gas
\u2014
12
Water
\u2014
9
Construction
2,719
1,591
Retail business
757
1,016
Wholesale business
113
811
Restaurants and hotels
67
121
Transports
56
137
Post offices
1
2
Telecommunications
2
5
Services
Financial intermediation
619
143
Real estate activities
483
146
Consulting, scientific and technical activities
8
37
Administrative and support services activities
29
931
Education
5
2
Health and collective service activities
1
1
Artistic, sports and recreational activities
3
6
Other services
8
75
Consumer loans
13,967
13,185
Mortgage credit
130
832
Other domestic activities
29
1,198
Other international activities
1,446
165
20,837
22,938
The analysis of recovered loans and interest occurred during 2022 and 2021, by type of credit, is as follows:
(Thousands of euros)
2022
2021
Asset-backed loans
130
818
Other guaranteed loans
4,237
1,547
Unsecured loans
16,301
18,089
Foreign loans
80
1,210
Factoring operations
\u2014
22
Finance leases
89
1,252
20,837
22,938
with this operation amounts to Euros 188,214.000 (31 December 2021: Euros 215.259.000) and bonds issued with
different subordination levels amount to Euros 142.062.000 (this amount excludes bonds hold by the Group in the
amount of Euros 63.937.000) and the most subordinated tranche amounts to Euros 44,000 (this amount excludes bonds
already acquired by the Group in the amount Euros 206,000).
Synthetic securitizations
As at 31 December 2022, BCP has three operations in progress which form structures of synthetic securitization with
similar characteristics, with reference to credit portfolios granted by the Bank mainly to Small and Medium Enterprises
(SMEs).
Caravela SME No. 3
Caravela SME No.3, supports an operation started on 28 June 2013, based on a medium and long term loans portfolio of
current accounts and authorized overdrafts. The legal maturity date of the operation is 25 March of 2036 and the
operation amounts to Euros 276,209,000 as at 31 December 2022 (31 December 2021: Euros 395,657,000). The fair value
of the relative Credit Default Swap (CDS) is recorded as a positive amount of Euros 179,713,000 and the respective
registered cost in 2022 amounts to Euros 4,824,000.
Caravela SME No. 4
Caravela SME No.4 is a similar operation, initiated on 5 June 2014, which portfolio contains car, real estate and
equipment leasing. The legal maturity date is 21 September of 2043 and, as at 31 December 2022, the operation
amounts to Euros 506,117,000 (31 December 2021: Euros 627,053,000). The fair value of the relative CDS is recorded as
a positive amount of Euros 61.551.000 and the respective registered cost in 2022 amounts to Euros 2,026,000.
Caravela SME No.5
Caravela SME No.5, initiated on 20 December 2022, is supported by a portfolio of medium and long term loans, leasing
contract and commercial paper programmes. The legal maturity date is 26 September of 2035 and, as at 31 December
2022, the operation amounts to Euros 1,918,408,000. The fair value of the relative CDS is recorded as a negative
amount of Euros 76,000 and the respective registered cost in 2022 amounts to Euros 1,424,000.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitizations, under CDS, the risk
of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity. In the case of both Caravela no. 3
and no. 4, the mezzanine and part of the equity (20%) were placed in the market through the issuance of Credit Linked
Notes (CLNs) by the above mentioned SPE which were subscribed by investors, while the Group retained the senior risk
and the remaining part of the equity (80%). In the case of Caravela, SME no. 5, only the full amount of the mezzanine
was placed in the market, while the Group retained the risk of the full amount of the senior and equity tranches. The
product of the CLNs issue was invested by the SPE in a deposit, which fully collateralizes the responsibilities in the
presence of its creditors including BCP, in accordance with the CDS.
These operations allowed the Bank to reduce the risk-weighted assets associated with the credit portfolios supporting
the operations, but the Bank did not transfer to third parties most of the rights and obligations arising from the credits
included in the respective portfolios, thus not meeting the derecognition criteria in the accounting policy presented in
note 1 C1.3.
Bank's Millennium securitization transactions
In March 2022, the Group's subsidiary Bank Millennium concluded a synthetic securitization transaction with the
participation of European Investment Bank (EIB) and European Investment Fund (EIF). The portfolio covered by the
transaction concerned receivables from small and medium-sized enterprises (SME) worth ca PLN 1.5 billion (Euros 320
million). Bank Millennium obtained the EIF guarantee for the senior tranche (ca PLN 1.2 billion [Euros 256 million]) and
the junior tranche (ca PLN 300 million [Euros 64 million]), which is unfunded credit protection within the meaning of
the CRR. The selected loan portfolio covered by the securitization remained in the Bank Millennium''s balance sheet.
On 23 December 2022, Bank Millennium settled another synthetic securitisation transaction executed on a portfolio of
corporate and SME receivables. The selected loan portfolio securitised remained on the bank's balance sheet. The risk
transfer was affected by a recognised credit protection instrument in the form of Credit Linked Notes (CLNs). The
issued bonds with a total nominal value of PLN 242.5 million (Euros 51.8 million) were acquired by a fund.
The transaction meets the requirements for the transfer of a material part of the risk, set out in the CRR Regulation
(Regulation of the European Parliament and of the Council No. 575/2013 of 26 June 2013 on prudential requirements
for credit institutions and investment firms).
Debt securities
The balance Debt securities is analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Portuguese issuers
Bonds
183,260
197,723
Commercial paper
1,256,557
1,074,715
Foreign issuers
Commercial paper
65,781
42,920
1,505,598
1,315,358
Overdue securities - over 90 days
40
40
1,505,638
1,315,398
Impairment
(4,676)
(7,059)
1,500,962
1,308,339
Debt securities held not associated with credit operations
Bonds issued by public entities (*)
Portuguese issuers
3,517,560
3,781,480
Foreign issuers
7,317,443
2,438,017
Bonds issued by other entities
Portuguese issuers
248,399
59,816
Foreign issuers
124,438
33,706
Treasury bills (Public Issuers and Central Banks)
\u00a0 Foreign issuers
336,343
592,581
11,544,183
6,905,600
Impairment
(9,563)
(8,743)
11,534,620
6,896,857
13,035,582
8,205,196
(*) Includes the negative amount of Euros 417,311,000 (31 December 2021: negative amount of Euros 17,349,000) related to
adjustments resulting from the application of fair value hedge accounting.
Under the terms of IFRS 9, the balance Debt securities held not associated with credit operations - Bonds issued by
public issuers, includes essentially a portfolio of securities to support Bank's ALM (Asset and Liability Management),
whose business model seeks to receive the respective income until maturity, that is, of a portfolio Held to Collect,
whose value as at 31 December 2022 amounts to Euros 9,248,707,000 (31 December 2021: Euros 5,409,085,000).
The balance Debt securities held not associated with credit operations - Bonds issued by other entities includes the
amount of Euros 69,805,000 (31 December 2021: Euros 39,519,000) related to public sector companies.
The analysis of the balance Debt securities before impairment, by maturity, as at 31 December 2022 is as follows:
(Thousands of euros)
2022
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese issuers
\u00a0 Bonds
\u2014
\u2014
13,480
169,780
\u2014
183,260
\u00a0 Commercial paper
860,395
396,162
\u2014
\u2014
40
1,256,597
Foreign issuers
\u00a0 Commercial paper
31,361
34,420
65,781
891,756
430,582
13,480
169,780
40
1,505,638
Debt securities held not associated
with credit operations
Public entities
\u00a0 Portuguese issuers
\u2014
\u2014
1,865,689
1,651,871
\u2014
3,517,560
\u00a0 Foreign issuers
50,410
212,482
970,601
6,083,950
\u2014
7,317,443
Other entities
\u00a0 Portuguese issuers
\u2014
\u2014
153,548
94,851
\u2014
248,399
\u00a0 Foreign issuers
\u2014
97,962
\u2014
26,476
\u2014
124,438
Treasury bills (Public Issuers and Central Banks)
\u00a0 Foreign issuers
237,209
99,134
\u2014
\u2014
336,343
287,619
409,578
2,989,838
7,857,148
\u2014
11,544,183
1,179,375
840,160
3,003,318
8,026,928
40
13,049,821
The analysis of the balance Debt securities before impairment, by maturity, as at 31 December 2021 is as follows:
(Thousands of euros)
2021
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese issuers
Bonds
\u2014
\u2014
5,542
192,181
\u2014
197,723
Commercial paper
794,596
280,119
\u2014
\u2014
40
1,074,755
Foreign issuers
Commercial paper
6,426
36,494
\u2014
\u2014
\u2014
42,920
801,022
316,613
5,542
192,181
40
1,315,398
Debt securities held not associated
with credit operations
Public entities
Portuguese issuers
\u2014
99,898
883,952
2,797,630
\u2014
3,781,480
Foreign issuers
4,659
40,048
288,741
2,104,569
\u2014
2,438,017
Other entities
Portuguese issuers
\u2014
\u2014
13,691
46,125
\u2014
59,816
Foreign issuers
\u2014
\u2014
\u2014
33,706
\u2014
33,706
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
143,081
449,500
\u2014
\u2014
\u2014
592,581
147,740
589,446
1,186,384
4,982,030
\u2014
6,905,600
948,762
906,059
1,191,926
5,174,211
40
8,220,998
The analysis of debt securities portfolio, net of impairment, by sector of activity, is analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Agriculture and forestry
2,496
4,733
Mining
46,403
13,736
Food, beverage and tobacco
79,448
63,815
Textiles
58,555
57,140
Wood and cork
19,630
12,103
Paper, printing and publishing
8,104
7,184
Chemicals
179,516
77,930
Machinery, equipment and basic metallurgical
65,973
48,453
Electricity and gas
165,676
172,325
Water
5,475
8,891
Construction
13,397
13,876
Retail business
20,507
13,601
Wholesale business
56,698
62,450
Restaurants and hotels
8,789
4,119
Transports
36,591
37,731
Telecommunications
9,706
6,559
Services
\u00a0 \u00a0 Financial intermediation
107,372
54,300
\u00a0 \u00a0 Real estate activities
50,845
40,150
\u00a0 \u00a0 Consulting, scientific and technical activities
473,231
541,187
\u00a0 \u00a0 Administrative and support services activities
12,269
10,706
\u00a0 \u00a0 Artistic, sports and recreational activities
10,406
9,868
\u00a0 \u00a0 Other services
4,095
4,562
Other international activities
65,780
42,920
1,500,962
1,308,339
Debt securities held not associated with credit operations
Electricity and Gas
88,873
6,573
Water
39,704
39,478
Services
Financial intermediation
460,781
626,287
Consulting, scientific and technical activities
119,297
13,511
708,655
685,849
Government and Public securities
10,825,965
6,211,008
11,534,620
6,896,857
13,035,582
8,205,196
The changes occurred in impairment of debt securities are analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Balance on 1 January
7,059
11,021
Charge for the year in net income interest
\u2014
47
Charge for the year (note 11)
8
244
Reversals for the year (note 11)
(2,393)
(2,533)
Loans charged-off
\u2014
(1,721)
Exchange rate differences
2
1
Balance at the end of the year
4,676
7,059
Debt securities held not associated with credit operations
Balance on 1 January
8,743
5,332
Transfers resulting from changes in the Group's structure
(Seguradora Internacional de Mo\u00e7ambique, S.A.)
\u2014
(15)
Other transfers
\u2014
(13)
Charge for the year (note 11)
3,329
4,874
Reversals for the year (note 11)
(2,779)
(1,826)
Exchange rate differences
270
391
Balance at the end of the year
9,563
8,743
Financial assets at fair value through profit or loss and financial assets at fair
value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2022
2021
Financial assets at fair value through profit or loss
Financial assets held for trading
Debt instruments
338,813
452,105
Equity instruments
51,540
48,879
Trading derivatives
376,244
430,501
766,597
931,485
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
20,929
79,189
Debt instruments
504,200
881,556
Equity instruments
27,550
30,193
552,679
990,938
Financial assets at fair value through other comprehensive income
Debt instruments
7,434,152
12,856,165
Equity instruments
27,401
34,823
7,461,553
12,890,988
8,780,829
14,813,411
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2022, is analysed as follows:
(Thousands of euros)
2022
At fair value through profit or loss
Held for trading
Not held for trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
21,450
\u2014
2,448,636
2,470,086
Foreign issuers
8,353
\u2014
2,916,098
2,924,451
Bonds issued by other entities
Portuguese issuers
\u2014
51
542,765
542,816
Foreign issuers
74
\u2014
897,146
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
308,936
\u2014
993
309,929
Foreign issuers
\u2014
\u2014
628,514
628,514
Shares of foreign companies (a)
\u2014
19,387
\u2014
19,387
Investment fund units (b)
\u2014
484,762
\u2014
484,762
338,813
504,200
7,434,152
8,277,165
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
18,811
18,811
Foreign companies
24
27,550
8,590
36,164
Other securities
51,516
\u2014
\u2014
51,516
51,540
27,550
27,401
106,491
Trading derivatives
376,244
\u2014
\u2014
376,244
766,597
531,750
7,461,553
8,759,900
Level 1
389,954
\u2014
6,489,282
6,879,236
Level 2
81,347
\u2014
322,514
403,861
Level 3
295,296
531,750
649,757
1,476,803
(a)Under IFRS 9 these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9 these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred in
IFRS 13, financial instruments are measured according to the levels of valuation described in note 49.
As at 31 December 2022, the balances Financial assets held for trading include bonds issued with different levels of
subordination associated with the traditional securitization transactions Magellan Mortgages No. 4, referred in note 1 D,
in the amount of Euros 74,000 (31 December 2021: Euros 87,000).
As at 31 December 2022, the balance Financial assets at fair value through other comprehensive income - Bonds issued
by other entities - Portuguese issuers includes the amount of Euros 25,505,000 (31 December 2021: Euros 165,967,000)
related to public sector companies.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
At fair value through profit or loss
Held for trading
Not held for
trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
10,317
\u2014
3,798,776
3,809,093
Foreign issuers
18,857
\u2014
6,736,241
6,755,098
Bonds issued by other entities
Portuguese issuers
1,716
16,734
742,554
761,004
Foreign issuers
1,073
\u2014
1,011,740
1,012,813
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
420,142
\u2014
6,027
426,169
Foreign issuers
\u2014
\u2014
560,827
560,827
Shares of foreign companies (a)
\u2014
35,185
\u2014
35,185
Investment fund units (b)
\u2014
829,637
\u2014
829,637
452,105
881,556
12,856,165
14,189,826
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
17,275
17,275
Foreign companies
32
30,193
17,548
47,773
Other securities
48,847
\u2014
\u2014
48,847
48,879
30,193
34,823
113,895
Trading derivatives
430,501
\u2014
\u2014
430,501
931,485
911,749
12,890,988
14,734,222
Level 1
499,147
\u2014
12,463,415
12,962,562
Level 2
169,181
\u2014
303,629
472,810
Level 3
263,157
911,749
123,944
1,298,850
(a)Under IFRS 9, these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9, these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
On balance sheet, the changes occurred during the 2022 and 2021, for impairment of financial assets at fair value
through other comprehensive, are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,092
1,097
Transfers to fair value changes (note 43)
5,024
(4,626)
Impairment through profit and loss (note 12)
545
4,784
Reversals through profit and loss (note 12)
(5,569)
(158)
Exchange rate differences
(25)
(5)
Balance at the end of the year
1,067
1,092
As at 31 December 2022, the accumulated impairment related to credit risk associated with the financial assets at fair
value through other comprehensive income amounts to Euros 5,270,000 and is recognised against Fair value reserves (31
December 2021: Euros 18,496,000).
The portfolio of financial assets at fair value through other comprehensive income, as at 31 December 2022, is analysed
as follows:
(Thousands of euros)
2022
Amortised cost
(a)
Fair value
hedge
adjustments
(note 43)
Fair value
adjustments
(note 43)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,708,319
(169,699)
(89,984)
2,448,636
Foreign issuers
3,007,189
\u2014
(91,091)
2,916,098
Bonds issued by other entities
Portuguese issuers
566,480
(19,099)
(4,616)
542,765
Foreign issuers
1,023,516
(83,632)
(42,738)
897,146
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
994
\u2014
(1)
993
Foreign issuers
628,509
\u2014
5
628,514
7,935,007
(272,430)
(228,425)
7,434,152
Equity instruments
Shares
Portuguese companies
33,448
\u2014
(14,637)
18,811
Foreign companies
19,799
\u2014
(11,209)
8,590
53,247
\u2014
(25,846)
27,401
7,988,254
(272,430)
(254,271)
7,461,553
(a)Include interest accrued and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31 December 2021, is analysed
as follows:
(Thousands of euros)
2021
Amortised cost
(a)
Fair value hedge
adjustments
(note 43)
Fair value
adjustments
(note 43)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
3,780,832
(23,435)
41,379
3,798,776
Foreign issuers
6,811,530
(21,427)
(53,862)
6,736,241
Bonds issued by other entities
Portuguese issuers
727,477
4,799
10,278
742,554
Foreign issuers
1,001,729
(1,051)
11,062
1,011,740
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
6,026
\u2014
1
6,027
Foreign issuers
560,989
\u2014
(162)
560,827
12,888,583
(41,114)
8,696
12,856,165
Equity instruments
Shares
Portuguese companies
37,069
\u2014
(19,794)
17,275
Foreign companies
27,996
\u2014
(10,448)
17,548
65,065
\u2014
(30,242)
34,823
12,953,648
(41,114)
(21,546)
12,890,988
(a)Include interest accrued and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31 December 2022, by
valuation levels, is analysed as follows:
(Thousands of euros)
2022
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,336,787
133,299
\u2014
2,470,086
Foreign issuers
2,908,924
\u2014
15,527
2,924,451
Bonds issued by other entities
Portuguese issuers
416,374
57,212
69,230
542,816
Foreign issuers
853,605
43,615
\u2014
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
309,929
\u2014
\u2014
309,929
Foreign issuers
\u2014
88,462
540,052
628,514
Shares of Foreign companies (**)
\u2014
\u2014
19,387
19,387
Investment fund units
\u2014
\u2014
484,762
484,762
6,825,619
322,588
1,128,958
8,277,165
Equity instruments
Shares
Portuguese companies
2,402
\u2014
16,409
18,811
Foreign companies
24
\u2014
36,140
36,164
Other securities
51,191
\u2014
325
51,516
53,617
\u2014
52,874
106,491
Trading derivatives
\u2014
81,273
294,971
376,244
6,879,236
403,861
1,476,803
8,759,900
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at 31
December 2021, is as follows:
(Thousands of euros)
2021
Up to 3
months
3 months to 1
year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
32,301
1,370,717
2,406,075
\u2014
3,809,093
Foreign issuers
\u2014
1,067,698
4,285,163
1,402,237
\u2014
6,755,098
Bonds issued by other entities
Portuguese issuers
40,017
203
588,298
132,486
\u2014
761,004
Foreign issuers
\u2014
\u2014
389,622
623,191
\u2014
1,012,813
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
270,511
155,658
\u2014
\u2014
\u2014
426,169
Foreign issuers
20,411
540,416
\u2014
\u2014
\u2014
560,827
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
35,185
35,185
Investment fund units
\u2014
\u2014
284,865
539,067
5,705
829,637
330,939
1,796,276
6,918,665
5,103,056
40,890
14,189,826
Equity instruments
Shares
Portuguese companies
17,275
17,275
Foreign companies
47,773
47,773
Other securities
48,847
48,847
\u2014
\u2014
\u2014
\u2014
113,895
113,895
330,939
1,796,276
6,918,665
5,103,056
154,785
14,303,721
The balance Financial assets not held for trading mandatorily at fair value through profit or loss - Loans to customers at
fair value is analysed as follows:
(Thousands of euros)
2022
2021
Unsecured loans
17,217
74,248
Overdue loans - less than 90 days
554
1,626
Overdue loans - Over 90 days
3,158
3,315
20,929
79,189
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2022, is as follows:
(Thousands of euros)
2022
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
5
\u2014
5
Paper, printing and publishing
45,562
2
\u2014
45,564
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
6
\u2014
6
Electricity and gas
2,302
\u2014
\u2014
2,302
Water
44,627
\u2014
\u2014
44,627
Construction
9,460
2
20,159
29,621
Retail business
4,934
2
\u2014
4,936
Wholesale business
20,503
260
\u2014
20,763
Restaurants and hotels
6,456
1,401
\u2014
7,857
Transports
29,491
\u2014
\u2014
29,491
Telecommunications
38,869
4,401
\u2014
43,270
Services
\u00a0 Financial intermediation (*)
1,533,154
54,477
512,408
2,100,039
\u00a0 Consulting, scientific and technical activities
303,036
103
\u2014
303,139
\u00a0 Administrative and support services activities
26,691
8,629
\u2014
35,320
\u00a0 Public sector
\u2014
\u2014
325
325
\u00a0 Other services
3,465
5,054
3,386
11,905
Other international activities
\u2014
18
\u2014
18
2,068,550
74,362
536,278
2,679,190
Government and Public securities
5,704,466
\u2014
\u2014
5,704,466
7,773,016
74,362
536,278
8,383,656
(*) The balance Other financial assets includes restructuring funds in the amount of Euros 410,571,000, which are classified in the
sector of activity Services - Financial intermediation but the core segment is disclosed in note 47.
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2021, is as follows:
(Thousands of euros)
2021
Bonds and Treasury
bills
Shares
Other Financial
Assets
Total
Fisheries
1,513
\u2014
\u2014
1,513
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
47,865
1
\u2014
47,866
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
7
\u2014
7
Electricity and gas
43,805
\u2014
\u2014
43,805
Water
10,241
\u2014
\u2014
10,241
Construction
21,155
2
20,423
41,580
Retail business
42,322
3
\u2014
42,325
Wholesale business
39,161
8,087
\u2014
47,248
Restaurants and hotels
\u2014
1,330
\u2014
1,330
Transports
77,463
\u2014
\u2014
77,463
Telecommunications
42,854
4,285
\u2014
47,139
Services
Financial intermediation (*)
1,016,537
72,308
839,714
1,928,559
Real estate activities
\u2014
\u2014
13,588
13,588
Consulting, scientific and technical activities
455,409
103
\u2014
455,512
Administrative and support services activities
12,220
7,981
\u2014
20,201
Public sector
\u2014
\u2014
136
136
Artistic, sports and recreational activities
16,683
\u2014
\u2014
16,683
Other services
4,893
6,118
4,623
15,634
1,832,121
100,233
878,484
2,810,838
Government and Public securities
11,492,883
\u2014
\u2014
11,492,883
13,325,004
100,233
878,484
14,303,721
Hedging derivatives
This balance is analysed, by hedging instruments, as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Assets
Liabilities
Swaps
59,703
178,000
109,059
377,206
Investments in associated companies
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Portuguese credit institutions
49,228
40,581
Foreign credit institutions
170,045
165,393
Other Portuguese companies
115,275
308,937
Other foreign companies
30,432
25,695
364,980
540,606
Impairment
(66,263)
(78,268)
298,717
462,338
These investments correspond to unquoted companies. According to the accounting policy described in note 1 B, these
investments are measured at the equity method.
The balance Investments in associated companies, as at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
Ownership on
equity
Goodwill
Impairment of
investments in
associated
companies
Total
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
261,446
\u2014
\u2014
261,446
Banco Millennium Atl\u00e2ntico, S.A.
65,716
54,744
(60,257)
60,203
Banque BCP, S.A.S.
44,933
\u2014
\u2014
44,933
SIBS, S.G.P.S, S.A.
47,142
\u2014
\u2014
47,142
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
7,684
\u2014
\u2014
7,684
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
33,146
7,435
\u2014
40,581
Webspectator Corporation
\u2014
18,011
(18,011)
\u2014
Others
349
\u2014
\u2014
349
460,416
80,190
(78,268)
462,338
The Group's companies included in the consolidation perimeter are presented in note 59, as well as the main indicators
of the most relevant ones.
The movements occurred in Impairment of investments in associated companies are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
78,268
52,559
Transfers from Other provisions (Banco Millennium Atl\u00e2ntico, S.A.) (note 39)
5,000
22,300
Sale Cold River's Homestead, S.A.
\u2014
(4,557)
Impairment charge for the year (note 13)
1,435
\u2014
Impairment\u00a0 write-off\u00a0 (Banco Millennium Atl\u00e2ntico, S.A.)
(16,787)
\u2014
Exchange rate differences
(1,653)
7,966
Balance at the end of the year
66,263
78,268
8,814
13,962
Goodwill associated with investment in BMA
3,419
4,373
Impairment of investments in associated companies (note 43)
1,653
(7,966)
Investment held at the end of the year
70,928
60,203
(*) Includes adjustments according to BCP GAAP.
The following table presents the financial statements of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.,
prepared in accordance with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2022
2021
Net profit for the year
74,425
69,900
Comprehensive income
(222,939)
(11,690)
Total comprehensive income attributable to Shareholders of the associated company
(148,514)
58,210
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
6,822
8,096
Attributable to Shareholders of the associated company adjusted to BCP GAAP
(141,692)
66,306
Attributable to the BCP Group
(69,429)
32,490
Balance sheet
Financial assets
8,417,704
10,263,904
Non-financial assets
459,055
429,543
Financial liabilities
(8,405,919)
(9,810,182)
Non-financial liabilities
(69,123)
(62,344)
Total equity
401,717
820,921
Attributable to non-controlling interests
10,929
11,718
Attributable to Shareholders of the associated companies
390,788
809,203
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
362,086
355,263
Attributable to Shareholders of the associated company adjusted to BCP GAAP
752,874
1,164,466
Attributable to the BCP Group
368,908
570,588
Reverse of the initial gain in 2004 allocated to the BCP Group
(309,142)
(309,142)
Attributable to the BCP Group adjusted of consolidation items
59,766
261,446
(*) VOBA corresponds to the estimated current value of the future cash flows of the contracts in force at the date of acquisition. The
value of the acquired business (VOBA) is recognised in the consolidated accounts of Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. as intangible assets and is amortised over the period of recognition of the income associated with the policies acquired.
The Group owns 49% of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., being accounted for under the equity
method, as Investments in associated companies.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A. is dedicated to the management of life insurance and pension
funds.
On 1 January 2023 Millenniumbcp Ageas made the simultaneous adoption of IFRS9 - Financial Instruments and IFRS17 -
Insurance Contracts. It opted for the possibility given to Insurance Companies to defer the application of IFRS9, since
the combined implementation with IFRS17 would minimize the distortion of results.
IFRS 17 replaces IFRS 4 - \"Insurance Contracts\" and is applicable to all entities that issue insurance contracts,
reinsurance contracts and investment contracts with discretionary participation features if they are also issuers of
insurance contracts.
In accordance with IFRS 17, at initial recognition, Millenniumbcp Ageas Grupo Segurador has identified the contracts
that are subject to similar risks and that are managed together, being aggregated in portfolios. For measurement
purposes, further divides portfolios of insurance contracts into groups of insurance contracts. A group of insurance
contracts is determined by first dividing the portfolio of insurance contracts into annual cohorts. Each annual cohort is
then further divided in the following groups: i) group of contracts that are onerous at initial recognition; ii) group of
contracts that at initial recognition have no significant possibility of becoming onerous subsequently; and iii) a group of
the remaining contracts in the portfolio.
Insurance contracts are now measured using estimates and updated assumptions that reflect the timing of cash flows
discounted and any uncertainty related to insurance contracts. Income is now recognized as it provides insurance
services (rather than when it receives premiums) provide information on the insurance contract earnings that it expects
to recognize in the future.
In the measurement of insurance contracts, Millenniumbcp Ageas Grupo Segurador has opted for two measurement
methods: i) Premium allocation approach (\"PAA\") for contracts with duration equal to or less than one year and ii)
General measurement model measurement model (\"GMM\") for the remaining contracts.
Initial application of IFRS 17 and IFRS 9 requires comparative information. Therefore, Millenniumbcp Ageas Grupo
Segurador made the transition exercise on 1 January 2022. The estimated impacts of the transition to IFRS 17 represent
a reduction in the Equity of Millenniumbcp Ageas Grupo Segurador, partially offset by the positive impact resulting from
the adoption of IFRS9.
IFRS 17 is retrospective with exemptions provided for the transition date. These exemptions are related to the
impracticability and complexity involved e.g. in calculating the liability, the current service margin (\"CSM\"), loss
component, or other comprehensive income (\"OCI option\") at transition date. When impracticable, the standard
provides for the use of the Modified Retrospective Approach or the Fair Value Approach. Millenniumbcp Ageas Grupo
Segurador, for contracts prior to 2018 adopted the fair value and for contracts after 2018 the full retrospective
approach.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., ('Millenniumbcp Ageas' or 'Group'), is owned by Ageas Insurance
International, N.V. (51%), through Ageas Portugal Holdings S.G.P.S., S.A. (51%), and by Banco Comercial Portugu\u00eas, S.A.
(49%).
Non-current assets held for sale
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
326,577
(90,699)
235,878
630,082
(127,218)
502,864
Assets belong to investments funds and
real estate companies
266,544
(46,497)
220,047
279,071
(50,481)
228,590
Assets for own use (closed branches)
20,556
(6,626)
13,930
22,800
(5,939)
16,861
Equipment and other
22,117
(5,743)
16,374
24,421
(7,076)
17,345
Other assets
12,806
\u2014
12,806
14,854
\u2014
14,854
648,600
(149,565)
499,035
971,228
(190,714)
780,514
Other tangible assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Real estate
670,000
708,803
Equipment
Computer equipment
334,864
337,457
Security equipment
67,687
67,542
Interior installations
149,986
148,532
Machinery
47,283
49,455
Furniture
84,516
84,923
Motor vehicles
32,529
29,703
Other equipment
28,224
30,711
Right of use
Real estate
366,363
352,346
Vehicles and equipment
431
505
Work in progress
21,279
20,656
Other tangible assets
39
38
1,803,201
1,830,671
Accumulated depreciation
Relative to the current year (note 9)
(98,916)
(98,972)
Relative to the previous years
(1,129,588)
(1,130,978)
(1,228,504)
(1,229,950)
574,697
600,721
The balance Right-of-use essentially corresponds to real estate (branches and central buildings) and to a residual
number of vehicles, which are amortized according to the lease term of each contract, as described in the accounting
policy 1 H.
The changes occurred in Other tangible assets during 2022 are analysed as follows:
(Thousands of euros)
2022
Balance on 1
January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Real estate
708,803
2,442
(37,606)
(6,690)
3,051
670,000
Equipment:
Computer equipment
337,457
15,238
(31,600)
12,186
1,583
334,864
Security equipment
67,542
844
(1,372)
382
291
67,687
Interior installations
148,532
1,339
(1,880)
1,198
797
149,986
Machinery
49,455
611
(2,068)
(380)
(335)
47,283
Furniture
84,923
440
(3,583)
2,371
365
84,516
Motor vehicles
29,703
7,033
(4,869)
306
356
32,529
Other equipment
30,711
180
(2,223)
107
(551)
28,224
Right of use
Real estate
352,346
35,010
(20,114)
(8)
(871)
366,363
Vehicles and equipment
505
\u2014
(65)
\u2014
(9)
431
Work in progress
20,656
24,408
(1,133)
(22,808)
156
21,279
Other tangible assets
38
\u2014
\u2014
\u2014
1
39
1,830,671
87,545
(106,513)
(13,336)
4,834
1,803,201
Accumulated depreciation
Real estate
(428,656)
(14,917)
31,982
5,702
(176)
(406,065)
Equipment:
Computer equipment
(300,560)
(16,375)
31,432
(116)
(1,359)
(286,978)
Security equipment
(63,723)
(862)
1,337
152
(254)
(63,350)
Interior installations
(131,897)
(3,007)
1,828
446
(524)
(133,154)
Machinery
(41,681)
(1,535)
1,997
1,427
268
(39,524)
Furniture
(78,344)
(2,717)
3,543
(1,232)
(257)
(79,007)
Motor vehicles
(17,743)
(4,636)
4,189
(53)
(214)
(18,457)
Other equipment
(23,811)
(1,498)
2,222
12
415
(22,660)
Right of use
Real estate
(142,996)
(53,365)
17,094
1
427
(178,839)
Vehicles and equipment
(501)
(4)
65
\u2014
9
(431)
Other tangible assets
(38)
\u2014
\u2014
\u2014
(1)
(39)
(1,229,950)
(98,916)
95,689
6,339
(1,666)
(1,228,504)
600,721
(11,371)
(10,824)
(6,997)
3,168
574,697
The changes occurred in Other tangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on 1
January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Real estate
725,639
990
(29,510)
(2,200)
13,884
708,803
Equipment:
Computer equipment
330,853
7,011
(12,828)
5,915
6,506
337,457
Security equipment
69,812
403
(3,413)
(136)
876
67,542
Interior installations
144,693
1,275
(1,243)
1,446
2,361
148,532
Machinery
49,452
369
(1,670)
984
320
49,455
Furniture
84,962
448
(2,097)
534
1,076
84,923
Motor vehicles
29,448
4,375
(6,087)
432
1,535
29,703
Other equipment
30,886
18
(1,168)
1,045
(70)
30,711
Right of use
Real estate
334,608
35,024
(19,979)
\u2014
2,693
352,346
Vehicles and equipment
929
14
(436)
\u2014
(2)
505
Work in progress
18,021
15,792
(128)
(13,860)
831
20,656
Other tangible assets
248
2
(252)
\u2014
40
38
1,819,551
65,721
(78,811)
(5,840)
30,050
1,830,671
Accumulated depreciation
Real estate
(431,312)
(14,945)
18,823
2,589
(3,811)
(428,656)
Equipment:
Computer equipment
(291,414)
(16,606)
12,505
(34)
(5,011)
(300,560)
Security equipment
(65,662)
(864)
3,413
136
(746)
(63,723)
Interior installations
(128,864)
(2,726)
1,041
155
(1,503)
(131,897)
Machinery
(41,333)
(1,294)
1,425
(253)
(226)
(41,681)
Furniture
(77,162)
(2,781)
1,958
376
(735)
(78,344)
Motor vehicles
(17,215)
(4,353)
4,850
(20)
(1,005)
(17,743)
Other equipment
(23,586)
(1,497)
1,073
179
20
(23,811)
Right of use
Real estate
(101,475)
(53,799)
13,302
\u2014
(1,024)
(142,996)
Vehicles and equipment
(668)
(107)
272
\u2014
2
(501)
Other tangible assets
(35)
\u2014
1
\u2014
(4)
(38)
(1,178,726)
(98,972)
58,663
3,128
(14,043)
(1,229,950)
640,825
(33,251)
(20,148)
(2,712)
16,007
600,721
Goodwill and intangible assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
102,655
104,843
Euro Bank, S.A. (Poland)
41,038
41,913
Others
10,182
12,675
153,875
159,431
Impairment
Bank Millennium, S.A. (Poland)
(102,655)
\u2014
Others
(9,880)
(11,931)
(112,535)
(11,931)
41,340
147,500
Intangible assets
Software
277,205
234,192
Other intangible assets
73,607
70,823
350,812
305,015
Accumulated amortisation
Charge for the year (note 9)
(40,334)
(38,184)
Charge for the previous years
(169,131)
(158,118)
(209,465)
(196,302)
141,347
108,713
182,687
256,213
According to the accounting policy described in note 1 B, the recoverable amount of the Goodwill is annually assessed
in the second half of each year or whenever there are indications of eventual loss of value. In accordance with IAS 36
the recoverable amount of goodwill resulting from the consolidation of the subsidiaries, should be the greater between
its value in use (the present value of the future cash flows expected from its use) and its fair value less costs to sell.
Based on these criteria, the Group made in 2022, valuations of their investments for which there is goodwill recognised
considering among other factors:
(i) an estimate of future cash flows generated by each cash generating unit;
(ii) an expectation of potential changes in the amounts and timing of cash flows;
(iii) the time value of money;
(iv) a risk premium associated with the uncertainty by holding the asset; and
(v) other factors associated with the current situation of financial markets.
The valuations are based on reasonable and sustainable assumptions representing the best estimate of the Executive
Committee on the economic conditions that affect each subsidiary, the budgets and the latest projections approved for
those subsidiaries and their extrapolation to future periods. The assumptions made for these valuations might vary with
the change in economic conditions and in the market.
In 2022, there were no factors pointing to the deterioration of the value of those financial participations that could
lead to impairment charges in respect of goodwill, nor to the improvement of the value of those financial participations
that could lead to a reversion of previously booked impairments to the goodwill, except in the case of Bank Millennium
S.A. (Poland), in which case factors were identified during 2022 that showed a deterioration in the value of this
financial participation, which led to a total impairment of the goodwill then associated with the acquisition by the BCP
Group of the percentage of control over Bank Millennium S.A. (Poland) in the amount of Euros 102.3 million in the first
half of 2022.
Bank Millennium, S.A. (Poland)
The valuation exercises as of the end of 2021 and as of the end of the first half of 2022 considered as estimated cash
flows of the business the ones projected based on current operating results and assuming the business plan and
projections approved at the end of 2021 by the Executive Committee up to 2026. After that date, a perpetuity was
considered based on the average long-term expected adjusted rate of return for this activity in the Polish market.
Additionally, the market performance of Bank Millennium, S.A. in the Polish capital market was taken into
consideration (closing price of 8.195 PLN per share as at the end of 2021 and 3.886 PLN per share as at the end of the
first half of 2022) and the direct percentage of shareholding.
The above-mentioned business plan of Bank Millennium, S.A. covered a five-year period, from 2022 to 2026,
considering, along this period, an estimated compound annual growth rate of 7.0% (6.2% in 2020) for Total Assets and of
19.6% (8.4% in 2020) for Total Equity, while considering a ROE evolution from -8.0% by the end of 2022 to 17.6% by the
end of 2026 and 12.5% in perpetuity vs. an estimated evolution of 2.9% by the end of 2021 to 9.2% by the end of 2025
and 11.0% in perpetuity considered in 2020.
In the valuation exercise performed at year-end 2021, the exchange rate EUR/PLN considered was 4.5839 as at 31
December 2021. The Cost of Equity considered was 11.000% for the period 2022 to 2026 and in perpetuity, whereas
2020 exercise considered a Cost of Equity of 8.875% for the period 2021 to 2025 and in perpetuity, and, in both years, a
discretionary factor was considered to accommodate the uncertainty regarding the legal risk associated with the
mortgage loan portfolio in foreign currency to the PLN. The annual growth rate in perpetuity (g) was 2.88%.
Together with the business plans, other main assumptions considered for the impairment test were:
2021
2020
2019
Discount rate
11%
8.875%
8.565%
Growth rate (g)
2.88%
2.37%
2.8%
RoE steady state \u2013 Discount rate
1.5%
2.125%
1.935%
Despite the increase of the Cost of Equity and the negative deviation in shareholders' equity in the first half of 2022,
Bank Millennium S.A. (Poland) continued to deliver its Business Plan and projections with regard to operational
performance.
Notwithstanding the good operating performance of Bank Millennium S.A. (Poland), the expected effect that the
increase in reference interest rates has on the prospective evolution of net interest income and the fact that Bank
Millennium S.A. (Poland) continues to assess that the goodwill associated with the consumer credit business acquired
from EuroBank (40.9 million euros as at\u00a0 June 2022) is recoverable, given i) the sensitivity of the estimated value of the
Business Plan capitalized from end of 2021 to June 2022 to the main assumptions considered, ii) the variation of the
Shareholder\u2019s Equity in the first semester of 2022 when compared to the budgeted one, iii) the uncertainty associated
with the material impacts on the Business Plan and projections arising from potential regulatory and legislative
measures and those then communicated to the market, and iv) that the subsequent value estimate results in an
impairment amount proximate to the goodwill associated with the acquisition by the BCP Group of the current
percentage of control over Bank Millennium S.A. (Poland) in the amount of 102.3 million euros as at 30 June 2022, the
Executive Committee deemed it prudent to consider the total impairment of the goodwill then associated with the
acquisition by the BCP Group of the current percentage of control over Bank Millennium S.A. (Poland) in the amount of
Euros 102.3 million as at 30 June 2022.
The changes occurred in Goodwill and intangible assets, during 2022, are analysed as follows:
(Thousands of euros)
2022
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
159,431
\u2014
(2,512)
\u2014
(3,044)
153,875
Impairment for goodwill
(11,931)
(102,770)
2,512
\u2014
(346)
(112,535)
147,500
(102,770)
\u2014
\u2014
(3,390)
41,340
Intangible assets
Software
234,192
72,441
(25,315)
(3,664)
(449)
277,205
Other intangible assets
70,823
1,213
(1,037)
4,073
(1,465)
73,607
305,015
73,654
(26,352)
409
(1,914)
350,812
Accumulated depreciation
Software
(136,360)
(36,168)
24,859
419
451
(146,799)
Other intangible assets
(59,942)
(4,166)
1,027
(828)
1,239
(62,670)
(196,302)
(40,334)
25,886
(409)
1,690
(209,469)
108,713
33,320
(466)
\u2014
(224)
141,343
256,213
(69,450)
(466)
\u2014
(3,614)
182,683
The changes occurred in Goodwill and intangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
161,775
347
(3,558)
\u2014
867
159,431
Impairment for goodwill
(13,573)
(347)
1,989
\u2014
\u2014
(11,931)
148,202
\u2014
(1,569)
\u2014
867
147,500
Intangible assets
Software
201,918
49,781
(17,616)
(3,826)
3,935
234,192
Other intangible assets
67,777
\u2014
(341)
3,746
(359)
70,823
269,695
49,781
(17,957)
(80)
3,576
305,015
Accumulated depreciation
Software
(115,427)
(34,173)
15,543
57
(2,360)
(136,360)
Other intangible assets
(56,516)
(4,011)
341
(57)
301
(59,942)
(171,943)
(38,184)
15,884
\u2014
(2,059)
(196,302)
97,752
11,597
(2,073)
(80)
1,517
108,713
245,954
11,597
(3,642)
(80)
2,384
256,213
Income tax
The deferred income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
982,465
\u2014
982,465
983,177
\u2014
983,177
Employee benefits
835,619
\u2014
835,619
835,619
\u2014
835,619
1,818,084
\u2014
1,818,084
1,818,796
\u2014
1,818,796
Deferred taxes depending
on the future profits
Impairment losses (b)
438,430
(50,303)
388,127
601,925
(50,303)
551,622
Tax losses carried forward
188,693
\u2014
188,693
187,475
\u2014
187,475
Employee benefits
50,770
(136,019)
(85,249)
55,274
(6,918)
48,356
Financial assets at fair value through other
comprehensive income
729,416
(134,154)
595,262
125,907
(104,865)
21,042
Derivatives
\u2014
(5,482)
(5,482)
\u2014
(4,923)
(4,923)
Intangible assets
1,143
\u2014
1,143
1,639
\u2014
1,639
Other tangible assets
8,693
(3,380)
5,313
8,835
(4,037)
4,798
Others
111,336
(89,949)
21,387
123,468
(80,989)
42,479
1,528,481
(419,287)
1,109,194
1,104,523
(252,035)
852,488
Total deferred taxes
3,346,565
(419,287)
2,927,278
2,923,319
(252,035)
2,671,284
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(407,579)
407,579
\u2014
(235,103)
235,103
\u2014
Net deferred taxes
2,938,986
(11,708)
2,927,278
2,688,216
(16,932)
2,671,284
(a) Special Regime applicable to deferred tax assets
(b) The amounts as at 31 December 2022 and 2021 include deferred tax assets related with credit impairments non-accepted fiscally
of which credits were written-off, according to the expectation that the use of such impairments will be deductible for the purposes
of determining taxable income for the tax periods in which the legal conditions required for their tax deductibility are met.
As at 31 December 2022, the balance deferred tax assets amounts to Euros 2,938,986,000, of which Euros 2,750,881,000
are related to the Bank's activity. The deferred taxes assets relating to the individual activity include a net amount of
Euros 532,498,000 resulting from potential losses on derivatives of hedging cash flows from interest rate risk recognized
in other comprehensive income, whose average maturity of operations is four years and Euros 400,330,000 which
depends on the existence of future profitable profits (deferred tax assets not eligible under the special regime
applicable to deferred tax assets, approved by Law No. 61/2014, of 26 August), including:
- Euros 259,983,000 (net value) related to impairment losses; and
- Euros 162,400,000 resulting from tax losses carried forward from 2016 and 2020.
Special regime applicable to deferred tax assets
The Extraordinary General Meeting of the Bank that took place on 15 October 2014 approved the Bank's accession to the
Special Regime approved by Law No. 61/2014, of 26 August, applicable to deferred tax assets that resulted from not
deduction of expenses and negative equity variations with impairment losses on credits and post-employment or long-
term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods beginning on
or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last tax period prior
to that date and to part of expenses and negative equity variations associated with them. Pursuant to Law No. 23/2016,
of 19 August, this special regime is not applicable to expenses and negative equity variations with impairment losses on
credits and with post-employment or long-term employee benefits recorded in the period's taxation commencing on or
after 1 January 2016, nor to deferred tax assets to these associates.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-term
employee benefits covered by it are deducted, under the terms and conditions set out in the IRC Code and in relevant
separate tax legislation, up to the limit of the taxable profit for the tax period determined before these deductions.
Expenses and negative equity variations not deducted because of applying this limit are deducted in subsequent tax
periods, with the same limit. In the BCP Group, deferred tax assets associated with expenses and negative equity
variations under these conditions amount to Euros 1,599,199,000 (31 December 2021: Euros 1,569,265,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorization), deferred tax assets covered by
the Special Regime are converted into tax credits, in part or in wholeness. In situations of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period and the
total of equity capital, and a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights attributable to the State of equivalent value, rights that can be acquired by the
shareholders upon payment to the State of the same value. Tax credits may be offset against tax debts of the
beneficiaries (or an entity based in Portugal within the same prudential consolidation perimeter or included in the same
group of entities for which are applied the Special Tax Regime for Groups of Companies) or reimbursed by the State.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by Law
No. 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance no. 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law No. 98/2019, of 4
September, establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after
which the Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these rights are
subject to a right of acquisition by the shareholders on the date of creation of the rights of the State, exercisable in
periods that will be established by the Board of Directors until 3 years after the confirmation date of the conversion of
the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing entity shall deposit in
favour of the State the amount of the price corresponding to all the rights issued, within 3 months beginning from the
confirmation date of the conversion of the deferred tax asset into tax credit. Such deposit shall be redeemed when and
to the extent that the rights of the State are acquired by the shareholders or exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the approved rates or substantially approved at the balance sheet date. The deferred
tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law, current tax assets
and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities related to income
taxes levied by the same fiscal authority over the same taxable entity.
The current tax rate for Banco Comercial Portugu\u00eas, S.A. is analysed as follows:
2022
2021
Income tax
21%
21%
Municipal surtax rate (on taxable net income)
1.5%
1.5%
State tax rate (on taxable net income)
More than 1,500,000 to 7,500,000
3%
3%
From more than 7,500,000 to 35,000,000
5%
5%
More than 35,000,000
9%
9%
companies that comprise it. Income tax is calculated and registered, on an individual basis, in each of the Companies
that make up the RETGS as if the regime were not applicable. The effect of the offset between taxable income and tax
losses is reflected in the company that calculates tax losses.
The balance of Deferred tax assets not depending on the future profits (covered by the regime approved by Law no.
61/2014, of 26 August) includes the amounts of Euros 210,686,000 and Euros 4,020,000 recorded in 2015 and 2016,
respectively, related to expenses and negative equity variations with post-employment or long-term employee benefits
and to impairment losses in loans accounted until 31 December 2014.
Following the publication of the Notice of Bank of Portugal No. 5/2015, the entities that presented their financial
statements in Adjusted Accounting Standards issued by the Bank of Portugal (NCA), since 1 January 2016 began to apply
the International Financial Reporting Standards as adopted in the European Union, including, among others, the Bank's
individual financial statements.
As a result of this change, in the Bank's individual financial statements, the loans portfolio, guarantees provided and
other operations of a similar nature became subject to impairment losses calculated in accordance with the
requirements of International Accounting Standards (IAS 39 until 31 December 2017 and IFRS 9 since 1 January 2018),
replacing the registration of provisions for specific risk, for general credit risks and for country risk, in accordance with
Bank of Portugal\u2019s Notice No. 3/95.
The Regulatory Decrees No. 5/2016, of 18 November, No. 11/2017, of 28 December, and No. 13/2018, of 28 December,
established the maximum limits of impairment losses and other corrections of value for specific credit risk that are
deductible for the purpose of calculating the taxable profit under IRC in 2016, 2017 and 2018, respectively. These
Decrees declare that Bank of Portugal Notice No. 3/95 (Notice that was relevant for determining provisions for credit in
the financial statements presented on an NCA basis) should be considered for the purpose of calculating the maximum
limits of impairment losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, Banco Comercial Portugu\u00eas, S.A. and Banco ActivoBank, S.A. exercised the option to apply the
regime introduced by Law No. 98/2019, of September 4, under which impairment losses for credit risk relating to
exposures analysed on an individual basis or on a collective basis recognised under the terms of the applicable
accounting and regulatory standards and the rules in force until 2018 for the balance of impairment losses and other
value corrections for specific credit risk recorded until 31 December 2021 are maintained.
The Group complies with the guidelines of IFRIC 23 - Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred material impact on the financial statements resulting from its
application.
Analysis of the recoverability of deferred tax assets
In accordance with the accounting policy 1 Y.3 and with the requirements of IAS 12, the deferred tax assets were
recognised based on the Group's expectation of their recoverability. The recoverability of deferred taxes depends on
the implementation of the strategy of the Bank's Board of Directors, namely the generation of estimated taxable
income and its interpretation of tax legislation. Any changes in the assumptions used in estimating future profits or tax
legislation may have material impacts on deferred tax assets.
The assessment of the recoverability of deferred taxes assets is based on the projection of results for the period
between 2023 and 2032. The projected results before taxes for the years 2023, 2024 and 2025 are consistent with the
budget approved by the Board of Directors of the Bank in December 2022, which incorporates the priorities arising from
the Strategic Plan 2021-2024.
The abandonment of negative interest rates, which imposed a burden on banks, is favourably reflected in projected
profitability and convergence towards medium/long-term metrics and trends consistent with commercial positioning
and the coveted capture of efficiency gains, established in the review of the 2021-2024 Strategic Plan approved by the
corporate bodies, highlighting:
- the improvement in net interest income, which mainly reflects the referred increase in market interest rates and also
benefits from the preserving of the deposit base, the effort to grow credit and also the reinvestment of assets at the
new interest rates;
- the increase in commission income based on efficient and judicious management of commissioning and pricing
- the reduction of the cost of risk for levels in line with the Bank's current activity, with a lesser impact from the
historical portfolios of NPE, foreclosed assets and FRE (Corporate Restructuring Funds), consolidated the reduction of
these exposures achieved over the last years;
- capturing efficiency gains enhanced by digitalization, reflected in the control of operating costs, after the staff
reduction carried out in 2021.
To estimate taxable net income for the periods of 2023 to 2032, the following main assumptions were considered:
- The rules of the new tax regime of credit impairment were applied. In the application of these rules, the following
assumptions were considered, in general terms:
a) the impairment losses for credit risk relating to exposures analysed on an individual or collective basis, recognised
in accordance with the applicable accounting and regulatory standards, were considered deductible for tax purposes;
b) impairment reversals created until 31 December 2021 not accepted for tax purposes were estimated based on the
Reduction Plan of Non-Performing Assets 2022-2024 submitted to the supervisory authority in March 2022, and also on
the average reversal percentage observed in the last years of 2016 to 2022;
c) the referred average percentages were calculated separately, according to the presence or not of a mortgage
security, the eligibility for the special regime applicable to deferred tax assets and according to the clients\u2019 rating as
Non-Performing\u00a0 Exposures (NPE).
- The deductions related to impairment of financial assets were projected based on the destination (sale or settlement)
and the estimated date of the respective operations;
- Reversals of impairment of non-financial assets not accepted for tax purposes were projected considering the
expected periods of disinvestment in certain real estate. For the remaining assets without a forecasted term for
disinvestment, the reversals were estimated based on the average percentage of reversal observed in the years from
2016 to 2022. Non-deductible expenses related to the reinforcement of impairment of non-financial assets were
estimated on the based on the average percentage of amounts not deducted for tax purposes in the years from 2016 to
2022, compared to the amounts of reinforcements net of impairment recorded in those years.\u00a0
- The deductions related to employee benefits were projected based on their estimated payments or deduction plans,
in accordance with information provided by the actuary of the pension fund.\u00a0
- The realization of changes in the fair value of real estate investment funds was projected based on the information
available in the management agreements of the funds in question for the period expected for the respective
liquidation.
According to the estimate of future taxable income, the deferred taxes assets recorded as at 31 December 2022 are
adequate under the IAS 12 requirements.
In accordance with these assessments, the amount of unrecognised deferred tax related to tax losses, by year of origin
is as follows:
(Thousands of euros)
Tax losses carried forward
2022
2021
2014
161,895
160,206
2015
2
269
2016
286,419
286,422
2017
2,303
2,309
2018
108,234
108,261
2019
24,265
40,591
2020
2,307
2,359
2021
207,294
200,743
2022
21,080
\u2014
813,799
801,160
as follows:
(Thousands of euros)
2022
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(712)
\u2014
\u2014
(712)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(160,953)
\u2014
(2,542)
Tax losses carried forward (a)
2,785
(2,236)
669
Employee benefits
(6,199)
(126,957)
(449)
Financial assets at fair value through other comprehensive income
\u2014
575,491
(1,271)
Derivatives
\u2014
\u2014
(559)
Intangible assets
(463)
\u2014
(33)
Other tangible assets
503
\u2014
12
Others
(29,649)
6,803
1,755
(193,976)
453,101
(2,418)
(194,688)
453,101
(2,418)
Current taxes
Current year
(110,551)
(18)
\u2014
Correction of previous years
919
\u2014
\u2014
(109,632)
(18)
\u2014
(304,320)
453,083
(2,418)
The impact of income taxes in Net\u00a0 income and in other balances of Group's equity, as at 31 December 2021, is analysed
as follows:
(Thousands of euros)
2021
Net income for
the year
Reserves
Exchange
differences
Discontinued
operations (b)
Deferred taxes not depending on the future profits
Employee benefits
(1,288)
(2)
\u2014
\u2014
(1,288)
(2)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(121,002)
\u2014
(937)
\u2014
Tax losses carried forward (a)
15,567
3,353
3,607
(11,937)
Employee benefits
4,774
(10,218)
(283)
(643)
Financial assets at fair value through other
comprehensive income
\u2014
184,667
(12,286)
20
Derivatives
\u2014
\u2014
(472)
\u2014
Intangible assets
(382)
\u2014
1,972
\u2014
Other tangible assets
(174)
\u2014
(1,939)
\u2014
Others
(19,768)
332
11,802
(27)
(120,985)
178,134
1,464
(12,587)
(122,273)
178,132
1,464
(12,587)
Current taxes
Current year
(81,689)
6
\u2014
(3,233)
Correction of previous years
336
\u2014
\u2014
\u2014
(81,353)
6
\u2014
(3,233)
(203,626)
178,138
1,464
(15,820)
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity
changes recorded in reserves that contribute to the calculation of taxable income.
(b) Relates to Banque Priv\u00e9e BCP (Suisse), S.A. and Seguradora Internacional de Mo\u00e7ambique, S.A. (now designated Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.)
The reconciliation between the nominal tax rate and the effective tax rate is analysed as follows:
(Thousands of euros)
2022
2021
Net income / (loss) before income taxes
428,458
157,737
Current tax rate (%)
31.5%
31.5%
Expected tax
(134,964)
(49,687)
Non-deductible impairment and provisions (a)
(145,811)
(100,417)
Mandatory contributions to the banking sector (b)
(25,502)
(30,400)
Results of companies accounted by the equity method
21,657
17,935
Interests on other equity instruments (c)
11,655
11,655
Effect of the tax rate difference (d)
(8,508)
(20,002)
Effect of recognition/derecognition net of deferred taxes (e)
(24,252)
(23,400)
Non-deductible costs and other corrections
2,013
(2,875)
Correction of previous years
660
(5,410)
Autonomous tax
(1,268)
(1,025)
Total
(304,320)
(203,626)
Effective rate (%)
71.0%
129.1%
(e) In 2022 includes the negative amount of Euros 12,916,000 relating to unrecognized deferred taxes on tax losses for the year of\u00a0 BIM
\u2013 Banco Internacional de Mo\u00e7ambique. In 2021, it includes the negative amount of Euros 2,071,000 related to unrecognized income
taxes losses for the year of BIM and the negative amount of Euros 18,784,000 related to the non-recognition of deferred taxes on
temporary differences.
Other assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposit account applications
51,371
396,638
Capital supplies
178,725
244,991
Obligations with post-employment benefits (note 50)
593,494
202,366
Debtors for futures and options transactions
191,290
138,688
Debtors
\u00a0 Residents
\u00a0\u00a0Receivables from real estate,\u00a0transfers of assets and other securities
111,693
109,509
\u00a0\u00a0\u00a0\u00a0 Prosecution cases / agreements with the Bank
12,163
13,037
\u00a0\u00a0\u00a0\u00a0 SIBS
3,521
3,490
\u00a0\u00a0\u00a0\u00a0 Others
66,744
23,569
\u00a0 Non-residents
30,584
51,909
Amounts due for collection
80,024
81,082
Interest and other amounts receivable
69,613
69,354
Amounts receivable on trading activity
3,234
32,303
Amounts due from customers
51,229
29,020
Artistic patrimony
28,796
28,818
Prepaid expenses
23,654
23,157
Subsidies receivables
10,764
15,656
Other recoverable tax
9,082
11,696
Gold and other precious metals
3,640
3,851
Capital supplementary contributions
165
165
Associated companies
145
162
Sundry assets
254,276
166,030
1,774,207
1,645,491
Impairment for other assets
(191,752)
(260,199)
1,582,455
1,385,292
As referred in note 47, as at 31 December 2022, the item Capital supplies includes the amount of Euros 171,397,000 (31
December 2021: Euros 237,671,000) arising from the transfers of assets to Specialized recovery funds which have
impairment in the same amount.
As at 31 December 2021, the balance Deposit account applications included the amount of Euros 348,559,000 on the
Clearing houses / Clearing derivatives. During 2022, this type of operations was recorded directly in the book value of
trading and hedging derivatives, as a result of the change made in the clearing process from CTM (Collateralised-to-
Market) to STM (Settled-to-Market).
The balance Amounts receivable on trading activity includes amounts receivable within 3 business days of stock
exchange operations.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is to
periodically assess the collectability of these amounts and whenever impairment is identified, an impairment loss is
registered in the income statement.
The changes occurred in Impairment of other assets are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
260,199
265,342
Transfers resulting from changes in the Group's structure (SIM - Seguradora
Internacional de Mo\u00e7ambique)
(1,038)
(375)
Other transfers
908
536
Charge for the year (note 12)
17,699
16,618
Reversals for the year (note 12)
(7,047)
(9,263)
Amounts charged-off
(78,835)
(12,717)
Exchange rate differences
(134)
58
Balance at the end of the year
191,752
260,199
Resources from credit institutions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Resources and other financing
from Central Banks
Bank of Portugal
\u2014
592,740
592,740
\u2014
8,028,747
8,028,747
Central Banks abroad
\u2014
14,736
14,736
\u2014
82,155
82,155
\u2014
607,476
607,476
\u2014
8,110,902
8,110,902
Resources from credit institutions in
Portugal
Sight deposits
92,493
\u2014
92,493
96,654
\u2014
96,654
Term Deposits
\u2014
151,244
151,244
\u2014
64,217
64,217
CIRS and IRS operations collateralised
by deposits (*)
\u2014
\u2014
\u2014
\u2014
1,620
1,620
Other resources
\u2014
\u2014
\u2014
\u2014
1
1
92,493
151,244
243,737
96,654
65,838
162,492
Resources from credit institutions
abroad
Repayable on demand
74,890
\u2014
74,890
108,247
\u2014
108,247
Term deposits
\u2014
152,385
152,385
\u2014
89,053
89,053
Loans obtained
\u2014
293,387
293,387
\u2014
399,678
399,678
CIRS and IRS operations collateralised
by deposits (*)
92,299
\u2014
92,299
19,998
\u2014
19,998
Other resources
\u2014
4,186
4,186
\u2014
5,704
5,704
167,189
449,958
617,147
128,245
494,435
622,680
259,682
1,208,678
1,468,360
224,899
8,671,175
8,896,074
Resources from customers and other loans
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from customers
Repayable on demand
48,490,922
182,647
48,673,569
48,771,241
176,561
48,947,802
Term deposits
\u2014
19,816,079
19,816,079
\u2014
14,241,514
14,241,514
Saving accounts
\u2014
6,315,759
6,315,759
\u2014
5,912,193
5,912,193
Treasury bills and other assets
sold under repurchase agreement
\u2014
\u2014
\u2014
\u2014
28,718
28,718
Cheques and orders to pay
564,369
\u2014
564,369
369,802
\u2014
369,802
Other
\u2014
60,367
60,367
\u2014
60,198
60,198
49,055,291
26,374,852
75,430,143
49,141,043
20,419,184
69,560,227
In the terms of the Law, the Deposit Guarantee Fund was established to guarantee the reimbursement of funds
deposited in Credit Institutions. The criteria to calculate the annual contributions to the Portuguese fund are defined in
the Regulation no. 11/94 of the Bank of Portugal.
This balance is analysed, by remaining period until the next operation renewal date, as follows:
(Thousands of euros)
2022
2021
Deposits repayable on demand
48,673,569
48,947,802
Term deposits and saving accounts
Up to 3 months
14,069,453
10,785,617
3 to 6 months
7,034,909
5,999,221
6 to 12 months
3,921,351
2,784,000
1 to 5 years
1,106,125
584,717
Over 5 years
\u2014
152
26,131,838
20,153,707
Treasury bills and other assets sold under repurchase agreement
Up to 3 months
\u2014
28,718
\u2014
28,718
Cheques and orders to pay
Up to 3 months
564,369
369,802
564,369
369,802
Other
Up to 3 months
367
198
Over 5 years
60,000
60,000
60,367
60,198
75,430,143
69,560,227
Non subordinated debt securities issued
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Bonds
53,799
10,606
Covered bonds
\u2014
999,468
Medium term notes (MTN)
1,347,967
1,020,063
Securitisations
142,062
161,267
1,543,828
2,191,404
Interests to pay
(66,860)
(979)
Corrections to the value of liabilities subject to hedging operations
(12,523)
(13,564)
Deferred cost expenses
17,641
11,502
1,482,086
2,188,363
As described in note 48, in 2022 Banco Comercial Portugu\u00eas, S.A. issued senior preferred debt securities eligible for
MREL (Minimum Requirement for own funds and Eligible Liabilities), under its Euro Note Programme. The issue, in the
amount of Euros 350 million, will have a tenor of 3 years, with the option of early redemption by the Bank at the end of
year 2, an issue price of 100% and an annual interest rate of 8.5% during the first 2 years (corresponding to a spread of
5.547% over the 2-year mid-swap rate). The annual interest rate for the 3rd year was set at 3-month Euribor plus a
5.547% spread.
The characteristics of the bonds issued by the Group, as at 31 December 2022 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Maturity
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
BCP Cln Brisa Fev 2023 Epvm Sr 23
February, 2015
February, 2023
Fixed rate 2.65% - underlying
asset Brisa 022023
2,000
2,008
Bcp 6NC5 Senior Preferred EUR 500MN NG -
MTN 856
February, 2021
February, 2027
Fixed rate 1.125%year until
Feb-26 /after Euribor 3M +
Variable rate 1.55%
500,000
499,283
Bcp 1.75% Eur 500M 6.5Nc5.5 Social
Senior Preferred Notes - Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% per year
until Apr-27/after + Euribor
3M+ 2%
500,000
443,148
BCP2022 MTN 859 BCP Senior Preferred
Notes OCT 2025
October, 2022
October, 2025
Fixed rate\u00a0 8.5% until
October 2024; after 5.547% +
Euribor 3M
350,000
353,112
BCP Finance Bank:
BCP Fin.Bank - EUR 10 M
March, 2004
March, 2024
Fixed rate 5.01%
300
311
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
140,215
130,439
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
724
673
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
1,124
1,046
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05% + 1.39% =
20.95%
51,799
52,066
1,482,086
This balance as at 31 December 2022 is analysed by the remaining period, as follows:
(Thousands of euros)
2022
Up to 3
months
3 months to 6
months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
2,008
\u2014
\u2014
\u2014
52,066
54,074
Medium term notes (MTNs)
\u2014
\u2014
\u2014
852,706
443,148
1,295,854
Securitisations
\u2014
\u2014
\u2014
\u2014
132,158
132,158
2,008
\u2014
\u2014
852,706
627,372
1,482,086
Subordinated debt
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Bonds
Non-Perpetual
1,376,856
1,383,821
Interests to pay
(72,040)
(4,530)
Corrections to the value of liabilities subject to hedging operations
(2,436)
(2,709)
Deferred cost expenses
30,676
18,198
1,333,056
1,394,780
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following: mid-swap rate\u00a0 in force at the beginning of this period + 4.267%;
(ii) Annual interest rate of 3.871% during the first 5.5 years (corresponding to a spread of 4.231% over the 5.5-year mid-swap rate, for
the remaining 5 years will be applied over the mid-swap rate in force at the beginning of that period).
(iii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the
mid-swap rates of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the
5-year mid swaps rate prevailing at that time plus the Spread.
The analysis of the subordinated debt by remaining period, is as follows:
(Thousands of euros)
2022
2021
1 to 5 years
314,519
\u2014
Over 5 years
1,018,537
1,394,780
1,333,056
1,394,780
Financial liabilities held for trading
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Short selling securities
1,022
3,625
Trading derivatives (note 23)
\u00a0 Swaps
170,157
217,587
\u00a0 Options
7,414
1,478
Embedded derivatives
53,495
6,365
Forwards
9,418
2,186
240,484
227,616
241,506
231,241
Level 2
186,130
221,040
Level 3
55,376
10,201
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 49. The
balance Financial liabilities held for trading includes, as at 31 December 2022, the embedded derivatives valuation
separated from the host contracts in accordance with the accounting policy presented in note 1 C5. in the amount of
Euros 53,495,000 (31 December 2021: Euros 6,365,000). This note should be analysed together with note 24.
Financial liabilities designated at fair value through profit or loss
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposits from customers (*)
476,671
\u2014
Certificates
850,681
961,730
Debt securities at fair value through profit and loss
Medium term notes (MTN)
490,326
620,048
1,817,678
1,581,778
As at 31 December 2021, the analysis of this balance, by remaining period, is as follows:
(Thousands of euros)
2021
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Certificates
\u2014
\u2014
\u2014
\u2014
961,730
961,730
Debt securities at fair value through
profit and loss
MTN
13,781
606,267
\u2014
620,048
13,781
\u2014
\u2014
606,267
961,730
1,581,778
Provisions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Provision for guarantees and other commitments
110,754
110,649
Other provisions for liabilities and charges
451,032
348,095
561,786
458,744
Changes in Other provisions for liabilities and charges are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
348,095
207,691
Transfers resulting from changes in the Group's structure
\u2014
(30)
Transfers to Impairment of investments in associates
(Banco Millennium Atl\u00e2ntico, S.A.) (note 26)
\u2014
(22,300)
Other transfers
(5,504)
4,596
Charge of the year for restructuring costs (note 7)
4,414
84,152
Charge for the year (note 13)
569,226
651,156
Reversals for the year (note 13)
(1,854)
(16,566)
Amounts charged-off
(116,874)
(135,506)
Allocation to loan's portfolio (note 22)
(344,052)
(443,296)
Exchange rate differences
(2,419)
18,198
Balance at the end of the year
451,032
348,095
estimate of the amount and respective probability of payment.
This balance includes provisions for lawsuits, frauds and tax contingencies. As at 31 December 2022, the provisions
constituted to cover tax contingencies totalled Euros 38,311,000 (31 December 2021: Euros 37,524,000) and are
associated, essentially, to contingencies related to VAT and Stamp Duty.
Additionally, there are provisions for liabilities and charges recorded for corporate restructuring funds and carved-out
assets of the Project Crow, completed in December 2022.
In 2021, the Bank's Board of Directors approved in April the employee reduction plan. The decision was taken based on
a thorough analysis of needs and existing capacity, considering the specifics of the Bank, the changes in behaviour and
needs of customers, the impact of new technologies on business models and processes, as well as the developments
that are expected for the Bank.
The implementation of this plan started in mid-June 2021, having been contacted throughout the 3rd quarter of 2021
all employees covered by the program, which included early retirements and terminations. For diverse reasons, the
effective departure of some Employees was agreed for dates during the first half of 2022.
In view of the initiatives that had already been developed on 30 June 2021, the Bank considered that the requirements
defined in IAS 37 - Provisions, Contingent Liabilities and Contingent Assets for the recognition of restructuring costs in
its accounts for the first half of 2021 were met. Thus, in the first half of 2021, was recorded\u00a0 in personnel costs, a
provision for restructuring costs in the amount of Euros 81,373,000, which was reinforced in December in the amount of
Euros 2,779,000, which makes a total of Euros 84,152,000 in 2021 (note 7). As at 31 December 2021, the balance of the
provision for restructuring costs amounted to Euros 4,692,000, of which Euros 2,297,000 are referred to agreements
already concluded with some employees whose effective departures have been occur during the first half of 2022 and
Euros 2,395,000 are referred to future costs with the health protection of former Employees, who left the Bank as part
of the employees' reduction process developed in 2021.
As at December 2022, the balance of this provision amounts to Euros 4,893,000, which was reinforced in the amount of
Euros 4,414,000 (note 7), referring to agreements already concluded with some employees whose effective departures
will occur during the first half of 2023. In 2022, the Bank also has written-off the\u00a0 amount of Euros 4,213,000, of which
Euros 3,443,000 corresponds to costs with the employee's departures and Euros 770,000 refers to costs with health
protection of former Employees.
Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium (Poland)
In 2021, Bank Millennium changed the accounting policy regarding the recognition of provisions for future claims related
to active CHF mortgage loans in the balance sheet. As a result of changes in market conditions, such as the growing
number of unfavourable court judgments declaring the entire agreement or certain provisions of these credits to be
invalid, the Bank does not expect that all contractual cash flows related to these loans will be recovered. As a result,
Bank Millennium allocates provisions for future claims and recognizes them as a reduction of the gross carrying amount
of loans for which a decrease in future cash flows is expected, in accordance with paragraph B5.4.6 of IFRS 9 \"Financial
Instruments\" (previously provisions for future claims used to be recognized in accordance with IAS 37 \"Provisions,
Contingent Liabilities and Contingent Assets\"). As a result of the above change, the approach applied in accordance
with IAS 37 will be continued only regarding claims relating to already repaid (or almost fully repaid) receivables not
recognised in Bank Millennium's balance sheet.
As at 31 December 2022, the Loans and advances to customers portfolio in CHF has a gross amount of Euros
2.477.851,000 (31 December 2021: Euros 2,817,504,000).
As at 31 December 2022, the provisions estimated by Bank Millennium to address the legal risk related to foreign
currency-indexed mortgage loans amount to Euros 1,152,457,000 (PLN 5,395,344,000)), of which Euros 976,782,000
(PLN 4,572,901,000) are presented under assets, as a deduction from the gross amount of the loan portfolio in CHF
(note 22) and Euros 175,676,000 (PLN 822,443,000) are presented under Provisions.\u00a0
With reference to 31 December 2021, the provisions estimated by Bank Millennium to address the legal risk related to
foreign currency-indexed mortgage loans amounted to Euros 727,026,000 (PLN 3,332,614,000), of which Euros
636,309,000 (PLN 2,916,778,000) were presented under assets, as a deduction from the gross amount of the loan
portfolio in CHF (note 21) and Euros 90,716,000 (PLN 415,835,000) were presented under Provisions.
The variation in the level of provisions or concrete losses will depend on the final court decisions about each case and
on the number of court cases.
Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Interests and other amounts payable
163,843
148,522
Operations to be settled - foreign, transfers and deposits
212,208
134,996
Credit insurance received and to accrued
62,740
72,075
Holidays, subsidies and other remuneration payable
55,132
51,841
Transactions on securities to be settled
4,514
39,979
Public sector
43,628
35,460
Creditors
Rents to pay
185,163
211,345
Deposit account and other applications
89,386
58,390
Suppliers
35,649
39,350
From factoring operations
41,618
32,113
For futures and options transactions
73,394
14,356
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
10,819
6,389
Associated companies
21
106
\u00a0 Other creditors
\u00a0 \u00a0 Residents
66,158
27,107
\u00a0 \u00a0 Non-residents
70,590
60,394
Deferred income
10,155
9,543
Other administrative costs payable
4,763
4,133
Other liabilities
262,192
170,884
1,391,973
1,116,983
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the amount of
Euros 6,777,000 (31 December 2021: Euros 4,143,000) related to the actual value of benefits attributed associated with
mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity includes amounts payable within 3 business days of stock exchange
operations.
The Group has several operating leases for properties, being registered in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by maturity,
is as follows:
(Thousands of euros)
2022
2021
Until 1 year
20,402
22,250
1 to 5 years
137,949
82,181
Over 5 years
33,485
114,296
191,836
218,727
Accrued costs recognised in Net interest income
(6,673)
(7,382)
185,163
211,345
Share capital, Share premium and Other equity instruments
As at 31 December 2022, the Bank's share capital amounts to Euros 3,000,000,000 (31 December 2021: Euros
4,725,000,000) and is represented by 15,113,989,952 nominative book-entry shares without nominal value, fully
subscribed and paid up. As described in note 48, pursuant to the resolutions adopted at the General Meeting held on 20
December 2022, the Bank registered its new share capital of 3,000,000,000 Euros, maintaining the number of
nominatives, book-entry shares without nominal value and of the voting rights.
As at 31 December 2022, the Share premium amounts to Euros 16,470,667.11, corresponding to the difference between
the issue price (Euros 0.0834 per share) and the issue value (Euros 0.08 per share) determined under the scope of the
Exchange Offer occurred in June 2015.
As at 31 December 2022, the Other equity instruments in the amount of Euros 400,000,000 corresponds to 2,000
subordinated perpetual bonds (Additional Tier 1), issued on 31 January 2019, with a nominal value of Euros 200,000
each. This issue was classified as an equity instrument in accordance with the specific rules of IAS 32 and accounting
policy 1E. This operation without fixed term has the option of early repayment by the Bank as from the end of the 5th
year, and an annual interest rate of 9.25% during the first 5 years. As an instrument classified as AT1, the corresponding
interest payment is decided by the Bank at its discretion and is still subject to compliance with a set of conditions,
including compliance with the combined requirement of capital reserve and the existence of Distributable Funds in
sufficient amount. The payment of interest may also be cancelled by imposition of the competent authorities.
As at 31 December 2022, the shareholders who hold, individually or jointly, 5% or more of the Bank's capital, are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
Total Qualified Shareholdings
7,472,294,105
49.44%
49.44%
Under the scope of the Portuguese Securities Code update, which came into force at the beginning of 2022, the
reference threshold for qualifying holdings was changed from 2% to 5%.
As at 31 December 2021, the shareholders who hold, individually or jointly, 2% or more of the Bank's capital , are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd\u00a0
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
BlackRock, Inc. (*)
404,590,600
2.68%
2.68%
EDP Pension Fund (**)
311,616,144
2.06%
2.06%
Total Qualified Shareholdings
8,188,500,849
54.18%
54.18%
(*) In accordance with the announcement on 30 April 2021 (last information available).
(**) Allocation in accordance with Art. 20 (1.f) of the Portuguese Securities Code.
Legal and statutory reserves
Under the Portuguese legislation, the Bank is required to annually set-up a legal reserve equal to a minimum of 10% of
annual profits until the reserve equals the share capital, or until the sum of the free reserves constituted and the
retained earnings, if higher. In accordance with the proposal for the appropriation of net income for the 2021 financial
year approved at the General Shareholders' Meeting held on 4 May 2022, the Bank increased its legal reserves in the
amount of Euros 9,006,000, thus, as at 31 December 2022 the Legal Reserves amount to Euros 268,534,000 (31
December 2021: Euros 259,528,000).
In accordance with the current Portuguese legislation, the Group companies must set-up annually a reserve with a
minimum percentage between 5 and 20% of their net annual profits depending on the nature of their economic activity
and are recognised in Other reserves and retained earnings in the Bank's consolidated financial statements (note 43).
Reserves and retained earnings
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Fair value changes - Gross amount
Financial assets at fair value through other comprehensive income (note 23)
\u00a0 \u00a0 Debt instruments (*)
(228,425)
8,696
\u00a0 \u00a0 Equity instruments
(25,846)
(30,242)
Of associated companies and other changes
(67,758)
39,968
Cash-flow hedge
(1,744,727)
(100,394)
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
182
245
(2,066,574)
(81,727)
Fair value changes - Tax
Financial assets at fair value through other comprehensive income
\u00a0 Debt instruments
58,780
(12,426)
\u00a0 Equity instruments
1,550
6,055
Cash-flow hedge
540,755
26,330
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
(57)
(77)
601,028
19,882
(1,465,546)
(61,845)
Exchange differences arising on consolidation
\u00a0 Bank Millennium, S.A.
(92,629)
(76,542)
\u00a0 BIM - Banco Internacional de Mo\u00e7ambique, S.A.
(139,373)
(162,561)
\u00a0 Banco Millennium Atl\u00e2ntico, S.A.
(143,989)
(155,310)
\u00a0 Others
2,073
2,311
(373,918)
(392,102)
Application of IAS 29
\u00a0 Effect on equity of Banco Millennium Atl\u00e2ntico, S.A.
42,316
36,571
\u00a0 Others
(3,965)
(3,965)
38,351
32,606
Other reserves and retained earnings
3,047,062
1,001,645
1,245,949
580,304
(*) Includes the effects arising from the application of hedge accounting.
The fair value changes correspond to the accumulated changes of the Financial assets at fair value through other
comprehensive income and Cash flow hedge, in accordance with the accounting policy presented in note 1 C.
The variation in the fair value of cash flow hedges reflects the economic impact on these hedges of the pronounced
increase in market interest rates, an effect that is more than offset by the economic impact on the fair value of
liabilities that are more sensitive to such an increase and that are accounted for at amortized cost.
During 2022, the changes occurred in Fair value changes - Gross amount, excluding the effect of hedge accounting and
changes in own credit risk associated with financial liabilities at fair value through profit or loss, are analysed as
follows:
(Thousands of euros)
2022
Balance as
at 1 January
Fair value
changes
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as at
31 December
Financial assets at fair value through
other comprehensive income (nota 23)
Debt instruments
Debt securities - Portuguese public
issuers
41,380
(293,433)
146,264
(2,406)
18,210
(89,985)
Others
(32,684)
(183,482)
85,052
(2,617)
(4,709)
(138,440)
8,696
(476,915)
231,316
(5,023)
13,501
(228,425)
Equity instruments
(30,242)
(3,183)
\u2014
\u2014
7,579
(25,846)
Associated companies and other
changes
Millenniumbcp Ageas
30,328
(109,649)
\u2014
\u2014
\u2014
(79,321)
Others
9,640
1,923
\u2014
\u2014
\u2014
11,563
39,968
(107,726)
\u2014
\u2014
\u2014
(67,758)
18,422
(587,824)
231,316
(5,023)
21,080
(322,029)
The changes occurred during 2021 in Fair value changes - Gross amount, excluding the effect of hedge accounting and
changes in own credit risk associated with financial liabilities at fair value through profit or loss, are analysed as
follows:
(Thousands of euros)
2021
Balance as
at 1 January
Fair value
changes
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as at
31 December
Financial assets at fair value through
other comprehensive income (nota
23)
Debt instruments
Debt securities - Portuguese public
issuers
90,611
(49,191)
37,417
920
(38,377)
41,380
Others
114,981
(176,982)
54,546
3,706
(28,935)
(32,684)
205,592
(226,173)
91,963
4,626
(67,312)
8,696
Equity instruments
(38,366)
1,231
\u2014
\u2014
6,893
(30,242)
Associated companies and other
changes
Millenniumbcp Ageas
36,560
(6,232)
\u2014
\u2014
\u2014
30,328
Others
6,125
3,515
\u2014
\u2014
\u2014
9,640
42,685
(2,717)
\u2014
\u2014
\u2014
39,968
209,911
(227,659)
91,963
4,626
(60,419)
18,422
The item Disposals refers to the derecognition of debt securities and equity instruments at fair value through other
comprehensive income.
Non-controlling interests
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Fair value changes
Debt instruments
(98,139)
(77,625)
Equity instruments
2,380
2,993
Cash-flow hedge
(43,281)
(41,248)
Other
7
4
(139,033)
(115,876)
Deferred taxes
Debt instruments
18,531
14,704
Equity instruments
(467)
(568)
Cash-flow hedge
8,223
7,837
26,287
21,973
(112,746)
(93,903)
Exchange differences arising on consolidation
(187,306)
(181,738)
Actuarial losses (net of taxes)
1,742
435
Other reserves and retained earnings
1,080,424
1,217,878
782,114
942,672
The balance Non-controlling interests is analysed as follows:
(Thousands of euros)
Balance Sheet
Income Statement
2022
2021
2022
2021
Continuing operations
Bank Millennium Group
585,618
729,040
(108,125)
(145,672)
BIM - Banco Internacional de Mo\u00e7ambique Group
174,041
186,578
35,323
31,837
Other subsidiaries
22,455
27,054
(5,020)
202
782,114
942,672
(77,822)
(113,633)
Discontinued or discontinuing operations
BIM - Banco Internacional de Mo\u00e7ambique Group (*)
\u2014
\u2014
\u2014
543
782,114
942,672
(77,822)
(113,090)
Guarantees and other commitments
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Guarantees granted
Guarantees
4,144,220
3,957,973
Stand-by letter of credit
57,084
58,536
Open documentary credits
258,591
268,399
Bails and indemnities
135,718
136,145
4,595,613
4,421,053
Commitments to third parties
Irrevocable commitments
Term deposits contracts
1,621
8,760
Irrevocable credit lines
4,880,858
4,741,586
Securities subscription
41,285
70,017
Other irrevocable commitments
153,982
146,065
Revocable commitments
Revocable credit lines
5,834,056
5,437,681
Bank overdraft facilities
998,886
1,063,309
Other revocable commitments
128,025
133,354
12,038,713
11,600,772
Guarantees received
29,552,693
29,361,511
Commitments from third parties
13,453,876
13,567,068
Securities and other items held for safekeeping
75,348,414
80,154,791
Securities and other items held under custody by the Securities Depository Authority
82,314,713
92,350,151
Other off balance sheet accounts
131,084,605
129,608,603
Assets under management and custody
In accordance with the no. 4 of the 29th article of Decree-Law 252/2003 of 17 October, which regulates collective
investment organisms, the funds managing companies together with the custodian Bank of the Funds, are jointly
responsible to all the funds investors, for the compliance of all legal obligations arising from the applicable Portuguese
legislation and in accordance with the regulations of the funds. The total value of the funds managed by the Group
companies is analysed as follows:
(Thousands of euros)
2022
2021
Banco Comercial Portugu\u00eas, S.A. (*)
3,618,326
3,866,341
Interfundos - Sociedade Gestora de Organismos de\u00a0 Investimento Coletivo, S.A.
689,142
763,075
Millennium TFI S.A.
806,162
1,143,117
5,113,630
5,772,533
(*) Corresponds to the assets portfolio that are currently monitored and controlled by the business area as being managed by the Bank.
The Group provides custody, trustee, corporate administration, investment management and advisory services to third
parties, which involve the Group making allocation and purchase and sale decisions in relation to a wide range of
financial instruments. For certain services are set objectives and levels of return for assets under management and
custody. There is no capital or profitability guaranteed by the Bank in these assets. Those assets held in a fiduciary
capacity are not included in the financial statements.
The assets under management and custody are analysed as follows:
(Thousands of euros)
2022
2021
Assets under deposit
70,104,626
74,410,897
Wealth management
3,618,326
3,866,341
Investment funds
1,495,304
1,906,192
75,218,256
80,183,430
Transfers of assets
The Group performed a set of transactions of sale of financial assets (namely loans and advances to customers) for
Funds specialized in the recovery of loans. These funds take the responsibility for management of the borrower
companies or assets received as collateral with the objective of ensuring a pro-active management through the
implementation of plans to explore/increase the value of the companies/assets.
The specialized funds in credit recovery that acquired the financial assets are closed funds, in which the holders of the
participation units have no possibility to request the reimbursement of its participation units throughout the useful life
of the Fund. These participation units are held by several banks, which are the sellers of the loans, in percentages that
vary through the useful life of the Funds, ensuring however that, separately, none of the banks hold more than 50% of
the capital of the Fund.
The Funds have a specific management structure (General Partner), fully independent from the assignor banks and that
is selected on the date of establishment of the Fund. The management structure of the Fund has as main
responsibilities to: (i) determine the objective of the Fund and (ii) administrate and manage exclusively the Fund,
determining the objectives and investment policy and the conduct in management and business of the Fund. The
management structure is remunerated through management commissions charged to the Funds.
These funds (in which the Group holds minority positions) establish companies in order to acquire the loans to the
banks, which are financed through the issuance of senior and junior securities. The value of the senior securities fully
subscribed by the Funds that hold the share capital match the fair value of the asset sold, determined in accordance
with a negotiation based on valuations performed by both parties.
The value of the junior securities is equivalent to the difference between the fair value that was based on the valuation
of the senior security and the value of the transferred receivables. These junior securities, being subscribed by the
Group, will entitle the Group to a contingent positive value if the value of the assets transferred exceeds the amount of
the senior tranches plus the remuneration on them. Thus, considering these junior assets reflect a difference between
the valuations of the assets sold based on the appraisals performed by independent entities and the negotiation
between the parties, the Group performs the constitution of impairment losses for all of them.
Therefore, as a result of the transfer of assets occurred operations, the Group subscribed:
- Senior securities (participation units) of the funds, for which the cash-flows arise mainly from a set of assets
transferred from the participant banks. These securities are booked in Financial assets not held for trading mandatorily
at fair value through profit or loss portfolio and are accounted for at fair value based on the last available Net assets
value (NAV), as disclosed by the Management companies and audited at year end, still being analysed by the Bank;
- Junior securities (with higher subordination degree) issued by the Portuguese law companies held by the funds and
which are fully provided to reflect the best estimate of impairment of the financial assets transferred.
Within this context, not withholding control but maintaining an exposure to certain risks and rewards, the Group, in
accordance with IFRS 9 3.2\u00a0 performed an analysis of the exposure to the variability of risks and rewards in the assets
transferred, before and after the transaction, having concluded that it does not hold substantially all the risks and
rewards. Considering that it does not hold control and does not exercise significant influence on the funds or
companies' management, the Group performed, under the scope of IAS IFRS 9 3.2, the derecognition of the assets
transferred and the recognition of the assets received.
The results are calculated on the date of transfer of the assets. During 2022 and 2021, no credits were sold to corporate
restructuring funds.
The amounts accumulated as at 31 December 2022 and 2021, related to these operations, are analysed as follows:
(Thousands of euros)
Assets
transferred
Net assets
transferred
Received
value
Net gains
/ (losses)
Fundo Recupera\u00e7\u00e3o Turismo FCR (a)
304,400
268,318
294,883
26,565
Fundo Reestrutura\u00e7\u00e3o Empresarial FCR (b)
84,112
82,566
83,212
646
FLIT-PTREL (c)
577,803
399,900
383,821
(16,079)
Fundo Recupera\u00e7\u00e3o FCR (b)
343,266
243,062
232,267
(10,795)
Fundo Aquarius FCR (c)
132,635
124,723
132,635
7,912
Discovery Real Estate Fund (c)
211,388
152,155
138,187
(13,968)
Fundo Vega FCR (d)
113,665
113,653
109,599
(4,054)
1,767,269
1,384,377
1,374,604
(9,773)
The activity segments are as follows: a) Tourism; b) Diversified; c) Real estate and tourism; and d) Real estate.
At the end of December 2022, the sale process called Project Crow was completed, which included the sale of 3 hotel
assets of the Fundo Recupera\u00e7\u00e3o and the sale of all the investments held in the FLIT-PTREL and Fundo Recupera\u00e7\u00e3o
Turismo.
As at 31 December 2022, the assets received under the scope of these operations are comprised of:
(Thousands of euros)
2022
Senior securities
Junior securities
Participation
units
(note 24)
Capital supplies
(note 32)
Total
Fundo Reestrutura\u00e7\u00e3o Empresarial FCR
Gross value
60,963
\u2014
60,963
Impairment and other fair value adjustments
(37,966)
\u2014
(37,966)
22,997
\u2014
22,997
Fundo Recupera\u00e7\u00e3o FCR
Gross value
169,033
85,018
254,051
Impairment and other fair value adjustments
(134,767)
(85,018)
(219,785)
34,266
\u2014
34,266
Fundo Aquarius FCR
Gross value
119,631
\u2014
119,631
Impairment and other fair value adjustments
(11,527)
\u2014
(11,527)
108,104
\u2014
108,104
Discovery Real Estate Fund
Gross value
157,716
\u2014
157,716
Impairment and other fair value adjustments
(1,801)
\u2014
(1,801)
155,915
\u2014
155,915
Fundo Vega FCR
Gross value
48,762
86,379
135,141
Impairment and other fair value adjustments
(9,899)
(86,379)
(96,278)
38,863
\u2014
38,863
Total Gross value
556,105
171,397
727,502
Total impairment and other fair value adjustments
(195,960)
(171,397)
(367,357)
360,145
\u2014
360,145
As at 31 December 2022, the book value of these assets considers the last Fund's Global Net Asset Value (NAV)
communicated by the Management Companies.
The following aspects should also be mentioned: (i) these are Funds whose latest Limited Audit Reports available with
reference to 30 June 2022 and Audit Reports available with reference to 31 December 2022 for 2 funds and 31
December 2021 for 3 funds, do not include reserves; (ii) the funds are subject to supervision by the competent
authorities.
As at 31 December 2021, the assets received under the scope of these operations are comprised of:
(Thousands of euros)
2021
Senior securities
Junior securities
Participation
units
(note 24)
Capital
supplies
(note 32)
Capital
supplementary
contributions
Total
Fundo Recupera\u00e7\u00e3o Turismo FCR
Gross value
278,385
33,598
\u2014
311,983
Impairment and other fair value adjustments
(92,482)
(33,598)
\u2014
(126,080)
185,903
\u2014
\u2014
185,903
Fundo Reestrutura\u00e7\u00e3o Empresarial FCR
Gross value
60,963
\u2014
33,280
94,243
Impairment and other fair value adjustments
(36,415)
\u2014
(33,280)
(69,695)
24,548
\u2014
\u2014
24,548
FLIT-PTREL
Gross value
250,662
38,154
\u2014
288,816
Impairment and other fair value adjustments
(31,492)
(38,154)
\u2014
(69,646)
219,170
\u2014
\u2014
219,170
Fundo Recupera\u00e7\u00e3o FCR
Gross value
188,771
82,617
\u2014
271,388
Impairment and other fair value adjustments
(125,941)
(82,617)
\u2014
(208,558)
62,830
\u2014
\u2014
62,830
Fundo Aquarius FCR
Gross value
120,162
\u2014
\u2014
120,162
Impairment and other fair value adjustments
(16,497)
\u2014
\u2014
(16,497)
103,665
\u2014
\u2014
103,665
Discovery Real Estate Fund
Gross value
157,716
\u2014
\u2014
157,716
Impairment and other fair value adjustments
(8,244)
\u2014
\u2014
(8,244)
149,472
\u2014
\u2014
149,472
Fundo Vega FCR
Gross value
48,454
83,302
\u2014
131,756
Impairment and other fair value adjustments
(7,241)
(83,302)
\u2014
(90,543)
41,213
\u2014
\u2014
41,213
Total Gross value
1,105,113
237,671
33,280
1,376,064
Total impairment and other fair value adjustments
(318,312)
(237,671)
(33,280)
(589,263)
786,801
\u2014
\u2014
786,801
The supplementary capital contributions were initially recorded for the amount of Euros 33,280,000 and it was made a
negative fair value adjustment of the same amount.
The book value of these assets resulted from the last communication by the respective Management Company relating
the Global Net Asset Value (NAV) of the Fund which, as at 31 December 2021, corresponds to the NAV estimated with
reference to that date.
The following aspects should also be mentioned, among others: (i) for 3 funds the latest Audit Reports available (for 2
funds with reference to 31 December 2021 and for 1 fund with reference to 30 June 2021) do not include neither
reserves or emphasis; (ii) for 2 funds whose latest Limited Audit Reports available (with reference to 30 June 2021) and
the latest Audit Reports available (with reference to 31 December 2020) do not include reserves but includes an
emphasis related to the impacts and uncertainties of COVID-19 (for 1 fund); (iii) for 2 funds the latest Audit Reports
available (with reference to 31 December 2020) do not include reserves but includes an emphasis related to the
impacts and uncertainties of COVID-19 (for 1 fund); (iv) the funds are subject to supervision by the competent
authorities.
The detail of the commitments of subscribed and unpaid capital for each of the corporate restructuring funds is
analysed as follows:
(Thousands of euros)
2022
2021
Corporate restructuring funds
Subscribed
capital
Capital
realized
Subscribed
and unpaid
capital
Subscribed
capital
Capital
realized
Subscribed
and unpaid
capital
Fundo Recupera\u00e7\u00e3o Turismo FCR
\u2014
\u2014
\u2014
292,000
278,385
13,615
Fundo Reestrutura\u00e7\u00e3o Empresarial FCR
51,212
46,486
4,726
51,212
46,486
4,726
FLIT-PTREL
\u2014
\u2014
\u2014
244,337
244,337
\u2014
Fundo Recupera\u00e7\u00e3o FCR
186,602
169,033
17,569
206,805
188,771
18,034
Fundo Aquarius FCR
134,205
119,631
14,574
134,801
120,162
14,639
Discovery Real Estate Fund
158,991
158,991
\u2014
158,991
158,991
\u2014
Fundo Vega FCR
48,150
45,870
2,280
49,616
46,968
2,648
579,160
540,011
39,149
1,137,762
1,084,100
53,662
In 31 December 2022 and 2021, there are additional subscription commitments for the fund Discovery, in the amount of
Euros 1,107,000. In 2021 there were also commitments in the amount of Euros 15,248,000 for the fund FLIT-PTREL.
As previously mentioned, under the Project Crow, were sold 3 hotel assets of the Fundo Recupera\u00e7\u00e3o and the sale of all
the investments held in the FLIT-PTREL and Fundo Recupera\u00e7\u00e3o Turismo.
Additionally, are booked in Loans and advances to customer\u2019s portfolio and in balances Guarantees granted and
Irrevocable credit lines, the following exposures and respective impairment, in relation to entities controlled by these
funds:
(Thousands of euros)
Items
2022
2021
Loans and advances to customers
248,439
110,786
Guarantees granted and irrevocable credit lines
74,834
41,244
Gross exposure
323,273
152,030
Impairment
(15,183)
(22,445)
Net exposure
308,090
129,585
Project Crow
At the end of December 2022, the designated sale process for the Crow Project was completed, which included the sale
to a related company of Davidson Kempner Capital Management LP (Purchaser) of 3 hotel assets belonging to the Fundo
Recupera\u00e7\u00e3o and the sale of all shares/units of participation of the FLIT-PTREL and Fundo Recupera\u00e7\u00e3o Turismo funds,
together with the assets directly and indirectly held by these two funds, with the exception of a set of assets that were
transferred to the sellers and which, in the case of Banco Comercial Portugu\u00eas, S.A. include the investment held in a
Venture capital fund, in 2 real estate funds and in a company, as detailed in the table below.
(Thousands of euros)
2022
Financial assets not held for trading mandatorily at fair value through profit or loss (note 24)
Fundo Turismo Algarve, FCR
50,426
Lusofundo - Fundo de Investimento Imobili\u00e1rio Fechado
26,429
Fundo Especial de Investimento Imobili\u00e1rio Fechado Eurofundo
12,091
88,946
Non-current assets held for sale (note 27)
FLITPREL Tires, S.A.
17,919
17,919
106,865
following resolutions:
Item One \u2013 Approval of the amendment to article 4 (1) of the articles of association (Share Capital) aiming at the
special purpose of reformulating the items of equity, comprising the reinforcement of funds able of being regulatory
qualified as distributable by means of the reduction of the share capital in 1,725,000,000 euros, without changing
either the existing number of shares or net equity;\u00a0
Item Two - Ratification of the co-optation by the Board of Directors of 2 Directors for the 2022/2025 term of office;
Item Three - Election of an alternate member of the Audit Committee for the term of office 2022/2025.
Restructuring Funds
Banco Comercial Portugu\u00eas, S.A. informs that after the conclusion, on 12 August 2022, of the sale and purchase
agreements and other agreements (the \"Agreements\") with a related company of Davidson Kempner Capital
Management LP (the \"Purchaser\"), together with Novo Banco, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Banco Santander
Totta, S.A. and Oitante, S.A. (the \"Sellers\"), proceeded to the closing of the Project Crow and the implementation of
the Agreements were concluded on 29 December 2022, following the verification of the stipulated contractual
conditions precedent.
As a result of the closing of the Project Crow:
a.the Sellers\u2019 units in \u201cFundo de Recupera\u00e7\u00e3o Turismo, Fundo de Capital de Risco (\u201cFRT\u201d) together with the assets
directly and indirectly held by FRT were transferred to the Purchaser;
b.the Sellers\u2019 share in \u201cFLIT \u2013 PTREL, SICAV-SIF, S.C.A. (\u201cFLIT\u201d) together with the assets directly and indirectly held
by FLIT were transferred to the Purchaser;
c.certain hospitality assets indirectly held by Fundo Recupera\u00e7\u00e3o, FCR were indirectly acquired by FLIT;
d.certain assets indirectly held by FLIT and FRT were transferred to relevant Sellers.
Issue of senior preferred debt securities eligible for MREL
Banco Comercial Portugu\u00eas, S.A. (\u201cBank\u201d) hereby informs that it has fixed on 18 October 2022 the terms for a new issue
of senior preferred debt securities eligible for MREL (Minimum Requirement for own funds and Eligible Liabilities),
under its Euro Note Programme.
The issue, in the amount of Euros 350 million, will have a tenor of 3 years, with the option of early redemption by the
Bank at the end of year 2, an issue price of 100% and an annual interest rate of 8.5% during the first 2 years
(corresponding to a spread of 5.547% over the 2-year mid-swap rate). The annual interest rate for the 3rd year was set
at 3-month Euribor plus a 5.547% spread.
Minimum prudential requirements
Banco Comercial Portugu\u00eas, S.A. (BCP) hereby informs that, under the context of the Supervisory Review and
Evaluation Process (SREP), it has been notified of the decision of the European Central Bank (ECB) regarding minimum
prudential requirements to be fulfilled on a consolidated basis from January 1, 2023.
In addition, BCP was previously informed by the Bank of Portugal on its capital buffer requirement as \u201cother
systemically important institution\u201d (O-SII).
The ECB\u2019s decision prescribes the following minimum ratios as a percentage of total risk weighted assets (RWA) from
January 1, 2023:
30 September 2022 *
Minimum Capital Requirements
BCP Consolidated
Fully implemented
Capital
requirements
of which:
Pilar 1
Pilar 2
Buffers
CET1
9.16%
9.41%
4.50%
1.41%
3.50%
T1
11.13%
11.38%
6.00%
1.88%
3.50%
Total
13.75%
14.00%
8.00%
2.50%
3.50%
Banco Comercial Portugu\u00eas, S.A. informs that S&P Global Ratings upgraded its long-term issuer credit rating by one
notch to \u2018BB+\u2019, keeping the Outlook stable.
This upgrade follows the recent upgrade on the sovereign rating, as well as the recent improvement of BCP credit risk
profile, result of the 40% reduction in NPEs since 2019 and the expectations from S&P Global Ratings that the
uncertainties in Poland will have a manageable impact on the level of the Bank\u2019s capitalization.
The Outlook reflects the Bank\u2019s solid retail franchise that should enable to strength domestic profitability.
Credit holidays for PLN mortgage borrowers (Bank Millennium)
Following the signing by the President of the Republic of Poland and announcement in the Journal of Laws of the
Republic of Poland on the same day of the Act of 7 July 2022 on crowdfunding for business ventures and assistance to
borrowers (\u2018the Act\u2019), introducing, among others, a possibility of up to 8 months of credit holidays in 2022-2023 (\u2018credit
holidays\u2019) for PLN mortgage borrowers, the Bank Millennium's Group recognized a one-off cost in the third quarter in
the amount of PLN 1,422.9 million (Euros 306.1 million) (of which PLN 1,384.6 million (Euros 297.9 million) related to
Bank Millennium, while the costs of PLN 38.3 million (Euros 8.2 million) were charged to Millennium Bank Hipoteczny
S.A.). The amount of the adjustment was originally calculated as the difference between the gross value of the loan
portfolio as at the calculation date and the current value of estimated cash flows under loan agreements, considering
80% of loan principals that will suspend the repayment instalment. As a result of the analysis of customer behaviour
carried out in December 2022, the Bank Millennium's Group adjusted the estimates of the percentage of loan principals
that will suspend repayment instalments to 68%. As a result of the above and the currently expected costs, the value of
the adjustment recognized in 2022 was reduced to PLN 1,324.2 million (Euros 282.8 million) (of which PLN 1,291.6
million (Euros 275.8 million) related to Bank Millennium, while costs in the amount of PLN 32.6 million (Euros 7 million)
were charged to Millennium Bank Hipoteczny S.A.), as detailed in note 11.
Launching of Recovery Plan and Capital Protection Plan (Bank Millennium)
On 15 July 2022, the Bank Millennium informed that due to expected costs of credit holidays it could be reasonably
assumed that the Bank Millennium would record a negative net result for the 3rd quarter of 2022 and as a result its
capital ratios could fall below the current minimum requirements set by Polish Financial Supervision Authority (\u2018PFSA\u2019).
As the emergence of risk of a breach of respective capital ratios represents a prerequisite stipulated in the art. 142
sec. 1 and 2 of the Banking Act of 29 August 1997 (Journal of Laws 2021, item 2439, i.e. 28 December 2021, as
amended), on 15 July 2022 the Management Board of the Bank took a decision to launch the Recovery Plan, notifying of
the fact both PFSA and the Bank Guarantee Fund.
The Management Board of the Bank intends to increase capital ratios comfortably above the minimum required levels
through a combination of further improvement of operational profitability and capital optimisation initiatives such as
management of risk weighted assets (including securitisations).
Following the calculation of actual end of July 2022 capital ratios, pursuant to the Article 60 sec. 1 of the Act of 5
August 2015 on macroprudential supervision of the financial system and crisis management in the financial system
(Journal of Laws of 2022, item 963, i.e. of 6 May 2022, as amended), the Bank Millennium has also submitted to PFSA
the Capital Protection Plan.
Demerger of Millennnium Dom Maklerski
The Bank Millennium, S.A. and Millennium Dom Maklerski (100% subsidiary of the Bank Millennium S.A.) decided on the
Demerger by way of the inclusion of the Brokerage Activity in the Bank Millennium\u2019s structures in order to integrate
within a single entity the brokerage services so far provided through the Demerged Company. The decision to
effectuate the Demerger is dictated by:
- an interest in improving the efficiency of the operation of the brokerage activity in the Bank Millennium Group both in
the area of institutional and retail client services;\u00a0
- efforts to increase the quality and comprehensiveness of the brokerage service offer addressed to both individual and
institutional clients.
The MDM Division was conducted\u00a0 in accordance with Article 529 \u00a7 1.4 of the CCC, i.e. by:
a) transferring\u00a0 to the Bank Millennium S.A. a part of the property (assets and liabilities) and the rights and obligations
of the Divided Company in the form of an organised part of the MDM's enterprise related to the provision of brokerage
services (the \u201cBrokerage Business\u201d); and
b) keeping in MDM the part of the property (assets and liabilities) and the rights and obligations of the Divided Company\u00a0
in the form of an organised part of MDM's enterprise related to other activity not related to the brokerage services\u00a0 (the
\u201cNon-Regulated Business\u201d).
The division of MDM, as a result of which the Bank Millennium S.A. took over the Brokerage Business, took place and
was registered by the competent registry court on 29 July 2022.
Resolutions of the Annual General Meeting of Banco Comercial Portugu\u00eas, S.A.
Banco Comercial Portugu\u00eas, S.A. concluded on 4 May 2022, through electronic means and, simultaneously, at the Bank's
facilities, with 64.31% of the share capital represented, the Annual General Meeting of Shareholders, with the following
resolutions:
Item One \u2013 Approval of the individual and consolidated Annual Report, balance sheet and financial statements of 2021,
and the Corporate Governance Report, that includes a chapter on the remuneration of the management and supervisory
bodies and the Sustainability Report;
Item Two \u2013 Approval of the proposal for the appropriation of profit concerning the 2021 financial year;
Item Three \u2013 Approval of a vote of trust and praise addressed to the Board of Directors, including to the Executive
Committee and to the Audit Committee and each one of their members, as well as to the Chartered Accountant and its
representative;
Item Four \u2013 Approval of the updating of the policy for the remuneration of Members of the Management and Supervisory
Bodies;
Item Five \u2013 Approval of the update of the internal policy for the selection and assessment of the suitability of the
Members of the Management and Supervisory Bodies and Key-functions Holders;
Item Six \u2013 Approval of the update of the policy for selection and appointment of the Statutory Auditor or audit firm and
the hiring of non-prohibited non-audit services, under the terms of the legislation in force;
Item Seven \u2013 Approval of the proposal to amend the articles of association of Banco Comercial Portugu\u00eas, S.A.;
Item Eight \u2013 Election of the Board of Directors for the 2022/2025 term of office, including the Audit Committee;
Item Nine \u2013 Election of the Remunerations and Welfare Board for the term-of-office 2022/2025;
Item Ten \u2013 Approval of the acquisition and sale of own shares and bonds.
Payment of the dividend relating to the 2021 financial year
By resolution of the Annual General Meeting, the dividend relating to the 2021 financial year was paid, with the
following amounts per share:
Gross unit dividend: Euros 0.0009
Taxation (withholding at source): IRS: 28% / IRC: 25%
Amount withheld at source IRS/IRC (if applicable): Euros 0.000252 / Euros 0.000225
Net dividend per share: Euros 0.000648 / Euros 0.000675
Upgrade to Investment Grade of senior unsecured debt ratings by Moody\u2019s
Banco Comercial Portugu\u00eas, S.A. informs that Moody\u2019s rating agency, as part of its regular revision, upgraded BCP's
senior unsecured debt ratings to Investment Grade, from Ba1/Prime-2 to Baa3/Prime-2, driven by the reduction in the
stock of Non-performing assets (NPA) and the improvement in capitalization levels over the last years, the improvement
in domestic profitability, which offsets the impact of provisions for legal risk in Poland, as well as the BCP\u2019s funding
plan being executed to comply with its Minimum Requirement for own funds and Eligible Liabilities (MREL), including
the Combined Buffer Requirement (CBR), from January 2024.
Simultaneously, the rating agency affirmed the bank's Baseline Credit Assessment (BCA) and Adjusted BCA at ba2; the
Banks\u2019 deposit ratings at Baa2/Prime-2; the junior senior debt rating at (P)Ba2; the dated subordinated debt at (P)Ba3;
and its preference shares rating at B2(hyb).
The Outlook on the long-term deposit and senior unsecured debt ratings remains stable, reflecting Moody's view that
the Bank's creditworthiness will be steady over the outlook horizon.
Notification by Banco de Portugal of MREL requirements
Banco Comercial Portugu\u00eas, S.A. has been notified by Banco de Portugal, as the national resolution authority, about the
establishment of its minimum requirement for own funds and eligible liabilities (\"MREL\" or \"Minimum Requirement for
own funds and Eligible Liabilities\") as decided by the Single Resolution Board.
The resolution strategy applied continues to be that of a multiple point of entry (\"MPE\"). The MREL requirements to be
met by BCP Group of Resolution (consisting of BCP, S.A., Banco ActivoBank, S.A. and all the subsidiary companies of
BCP apart from Bank Millennium S.A. and Banco Internacional de Mo\u00e7ambique and their respective subsidiaries), from 1
January 2024 is of:
\u201323.81% of the total risk exposure amount (\"TREA\") (to which adds further a combined buffer requirement
(\"CBR\") of 3.5%, thus corresponding to total requirements of 27.31%); and
\u20136.92% of the leverage ratio exposure measure (\"LRE\").
Until the date mentioned before, BCP should comply with an interim requirement of:
\u201318.09% of TREA (to which adds a further 3.25% CBR requirement, thus corresponding to a total requirement of
21.34%); and
\u20136.92% of the LRE.
No subordination requirements have been applied to the Bank.
In accordance with the regulations in force, MREL requirements must be updated or reconfirmed annually, and
therefore these targets replace those previously set.
The MREL requirements, now communicated to the BCP resolution group described above, are in line with the 2021-24
Strategic Plan and are accommodated by the ongoing funding plan. As of 1 January 2022, BCP complied to the
intermediate MREL requirement set for that date, both as a percentage of the TREA (also including the applicable CBR)
and as a percentage of the LRE.
MREL requirements of Bank Millennium, S.A.
Bank Millennium, S.A. received the joint decision of the resolution authorities obliging to meet MREL requirements. At
the moment of communication of the decision, Bank Millennium at the consolidated level is obliged to meet the
minimum MREL - TREA requirements of 15.60% and MREL - TEM of 3.00%. At the individual level, the minimum MREL -
TREA was set at 15.55% and MREL - TEM 3.00%. Additionally, the above-mentioned decision sets updated minimum
requirements that must be met by December 31, 2023, along with mid-term objectives.
Bank Millennium is still to meet MREL requirements due to the net loss booked in recent periods and the fact that an
issue of senior non-preferred bonds on the Polish market initially planned for 4Q21 was not possible to execute due to a
gap in the Polish bond law and later due to the combination of unfavourable market conditions (markets were
effectively shut for issuers of SNP bonds from the CEE region) and looming risk of Poland\u2019s government enforcement of
costly extraordinary measures on the banking sector (credit holidays and replacement of WIBOR, among others).
Following the changes in the Polish bond law in May, Bank Millennium also started preparations for a domestic issue,
but due to the above-mentioned external factors, the decision to officially start the domestic offering was also put on
hold.
Bank Millennium prepared a Eurobond Issue Programme of the total nominal value not higher than Euros 3 billion and it
is monitoring the developments on the bond market that will allow for the issue.
Restoring capital ratios to minimum required ratios is currently the Bank Millennium\u2019s priority and once this is achieved
the Bank will take the further needed steps aimed at meeting the MREL requirements.
In particular, as far as MREL requirements are concerned, Bank Millennium intends to close the gap by year-end 2023
through a combination of organic capital generation and issuance of debt instruments, if required and market
conditions allow.
Ukraine War
In 2022 the Russian Federation invaded Ukraine, as widely reported by supranational institutions and the media.
Although the Group\u00b4s direct exposure to those countries\u00b4 economies is immaterial, the level of uncertainty currently
prevailing as to a potential escalation of the conflict means that significant indirect impacts in subsequent stages
cannot be totally discarded. Such potential impacts, however, cannot be quantified or reliably projected at this stage.\u00a0
Based on all the information available at the time, including that regarding the liquidity and capital situation, as well
as the value of the assets, it is considered that the going concern principle underlying the preparation of the financial
statements continues to apply.
Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to clients, fair value is estimated through internal models based on cash-flow discounting
techniques. Cash-flows for the different instruments sold are calculated according to its financial characteristics and
the discount rates used include both the market interest rate curve and the current conditions of the Group's pricing
policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree of
judgment and reflects exclusively the value attributed to different financial instruments. However, it does not consider
prospective factors, as the future business evolution. Therefore, the values presented cannot be understood as an
estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial liabilities are
presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions repayable on
demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable estimate of
its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and Assets with
repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined dates.
This update is made based on the prevailing market rate for the term of each cash flow plus the average spread of the
production of the most recent 3 months of the same. For the elements with signs of impairment, the net impairment of
these operations is considered as a reasonable estimate of their fair value, considering the economic valuation that is
realized in the determination of this impairment.
For resources from Central Banks, it was considered that the book value is a reasonable estimate of its fair value, given
the nature of operations and the associated short-term. The rate of return of funding with the European Central Bank
was -0.6788%\u00a0 as at 31 December 2022 and -1% as at 31 December 2021.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied by
the Group on identical instruments for each of the different residual maturities (rates from the monetary market or
from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to conditions
used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of its fair value.
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash flows
for these instruments, considering that the payments of the instalments occur in the contractually defined dates. For
loans with signs of impairment, the net impairment of these operations is considered as a reasonable estimate of their
fair value, considering the economic valuation that is realized in the determination of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes of
this type of instruments and with similar residual maturity. The discount rate includes the market rates for the residual
maturity date (rates from the monetary market or from the interest rate swap market) and the spread used at the date
of the report, which was calculated from the average production of the three most recent months compared to the
reporting date.
Resources from customers and other loans
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar maturity.
The discount rate includes the market rates of the residual maturity date (rates of monetary market or the interest
rate swap market, at the end of the period) and the actual spread of the Group. This was calculated from the average
production of the three most recent months compared to the reporting date.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives), financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"), whenever
these are available. If market prices are not available, fair value is estimated through numerical models based on cash-
flow discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering the
volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the available
models do not fully apply to meet the characteristics of the financial instrument, specific quotations supplied by an
external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt securities
These financial instruments are accounted at amortised cost net of impairment. Fair value is based on market prices,
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical cash-
flow discounting techniques and models for assessment of options considering variables of the market, particularly the
interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
Debt securities non subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet reflected in
the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-accounting\", the fair value
related to the interest rate risk is already recognised. For the fair value calculation, other components of risk were
considered, in addition to the interest rate risk already recorded, when applicable. The fair value is based on market
prices, whenever these are available. If market prices are not available, fair value is estimated through numerical
models based on cash-flow discounting techniques, using the market interest rate curve adjusted by associated factors,
predominantly credit risk and trading margin, the latter only in the case of issues placed on non-institutional customers
of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps established
specifically for each term and class of instruments based on the market prices on equivalent instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the cost
obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies used
in the determination of the fair value of the\u00a0 issues is analysed as follows:
2022
2021
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
9.33%
\u2014
4.8%
\u2014
Senior
0.19%
\u2014
2.33%
\u2014
Covered bonds
\u2014
\u2014
-0.08%
\u2014
Placed in retail
Senior and collateralised
3.37%
6.19%
0.12%
3.63%
For non subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of Euros 72,475,000 (31 December 2021: a
positive amount of Euros 11,616,000) and includes a payable amount of Euros 53,495,000 (31 December 2021: a payable
amount of Euros 6,365,000) which reflects the fair value of embedded derivatives and are recorded in financial assets
and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2022
2021
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.00%
4.45%
3.55%
6.76%
-0.59%
0.11%
0.19%
1.99%
7 days
2.00%
4.47%
3.58%
6.76%
-0.59%
0.14%
0.21%
1.99%
1 month
2.04%
4.57%
3.67%
6.83%
-0.56%
0.14%
0.25%
2.13%
2 months
2.13%
4.66%
3.80%
6.87%
-0.56%
0.16%
0.32%
2.28%
3 months
2.25%
4.77%
3.91%
6.92%
-0.56%
0.21%
0.38%
2.44%
6 months
2.73%
5.07%
4.32%
7.04%
-0.54%
0.33%
0.56%
2.74%
9 months
3.11%
5.28%
4.65%
7.09%
-0.51%
0.47%
0.76%
2.89%
1 year
3.26%
5.11%
4.87%
7.35%
-0.49%
0.52%
0.89%
3.71%
2 years
3.39%
4.69%
4.69%
6.97%
-0.30%
0.92%
1.20%
3.93%
3 years
3.31%
4.33%
4.56%
6.53%
-0.15%
1.15%
1.30%
3.88%
5 years
3.23%
4.02%
4.33%
6.20%
0.02%
1.34%
1.29%
3.74%
7 years
3.19%
3.89%
4.14%
6.13%
0.13%
1.45%
1.24%
3.63%
10 years
3.21%
3.82%
3.99%
6.20%
0.30%
1.56%
1.21%
3.54%
15 years
3.14%
3.79%
3.91%
6.45%
0.49%
1.68%
1.18%
3.74%
20 years
2.93%
3.72%
3.84%
6.49%
0.55%
1.74%
1.15%
3.86%
30 years
2.54%
3.48%
3.70%
6.49%
0.48%
1.72%
1.10%
3.86%
accordance with the accounting policy described in note 1 R.
As at 31 December 2022 and 2021, the number of participants in the Pension Fund of Banco Comercial Portugu\u00eas
covered by this pension plan and other benefits is analysed as follows:
Number of participants
2022
2021
Pensioners
17,111
17,177
Former Attendees Acquired Rights
3,495
3,539
Employees
6,370
6,407
26,976
27,123
benefits and the respective coverage, based on the Projected Unit Credit method are analysed as follows:
(Thousands of euros)
2022
2021
Actual amount of the past services
Pensioners
2,126,809
2,454,361
Former attendees acquired rights
161,387
255,662
Employees
502,428
787,599
2,790,624
3,497,622
Pension fund value
(3,384,118)
(3,699,988)
Net (assets) / liabilities in balance sheet (note 32)
(593,494)
(202,366)
Accumulated actuarial deviations and changing assumptions
effect recognised in Other comprehensive income
3,152,535
3,528,224
In 2017, following the authorization of the Insurance and Pension Funds Supervisory Authority, the BCP group's pension
fund agreement was amended. The main purpose of this process was to incorporate into the pension fund the changes
made to the Group's Collective Labour Agreement (CLA) in terms of retirement benefits and to pass on to the pension
fund the responsibilities that were directly in charge by the companies (extra-fund liabilities). The pension fund has a
share exclusively related to the financing of these liabilities, which under the scope of the fund is called an Additional
Complement, which as at 31 December 2022 amounts to Euros 197,486,000 (31 December 2021: Euros 260,168,000).
The End of Career Premium also came to be borne by the pension fund under the basic pension plan.
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates take
effect on 1 January 2021, with the exception of compensation for subsistence and travel allowances, which will be
updated after the agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions \"Mais Sindicato do Sector Financeiro\", \"SBC \u2013 Sindicato Banc\u00e1rios do Centro\" and \"SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal\", the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates were effective on 1 January 2022, with exception of compensation for
subsistence and travel allowances, which were effective after the agreed updates became operational.
Regarding \"SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios\", \"SIB \u2013 Sindicato Independente da Banca\", an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing. Although no agreement
has yet been reached with these unions, all Bank employees benefit from the same conditions.
The change in the projected benefit obligations is analysed as follows:
(Thousands of euros)
2022
2021
Balance as at 1 January
3,497,622
3,657,527
Service cost
(11,727)
(14,466)
Interest cost / (income)
67,059
43,034
Actuarial losses / (gains)
Not related to changes in actuarial assumptions
58,590
57,564
Related to changes in assumptions
(693,673)
(167,476)
Payments
(136,338)
(122,563)
Early retirement programmes and terminations by mutual agreement
2,223
36,583
Contributions of employees
6,868
7,451
Transfer from / (to) other plans
\u2014
(32)
Balance at the end of the year
2,790,624
3,497,622
As at 31 December 2022, the pensions paid by the Fund, including the Additional Complement, amounts to Euros
136,338,000 (31 December 2021: Euros 122,563,000).
The liabilities with health benefits are fully covered by the Pension Fund and correspond to Euros 241,345,000 as at 31
December 2022 (31 December 2021: Euros 311,161,000).
Additionally, regarding the coverage of some benefit obligations related to pensions, the Bank contracted with
Ocidental Vida the acquisition of perpetual annuities for which the total liability as at 31 December 2022 amounts to
Euros 39.093,000 (31 December 2021: Euros 40,811,000), in order to pay:
i) pensions of former Group's Board Members in accordance with the Bank's Board Members Retirement Regulation;
ii) pensions and complementary pensions to pensioners in accordance with the Pension Fund of the BCP Group
employees established in 28 December 1987, as also to pensioners, in accordance with other Pension Funds, that were
incorporated after on the BCP Group Pension Fund and which were planed that the retirement benefits should be paid
through the acquisition of insurance policies, in accordance with the Decree - Law no. 12/2006.
Ocidental Vida is 100% owned by Ageas Group and Ageas Group is 49% owned by the BCP Group.
During 2022 and 2021, the changes occurred in the plan's assets value is analysed as follows:
(Thousands of euros)
2022
2021
Balance as at 1 January
3,699,988
3,750,567
Employees' contributions
6,868
7,451
Actuarial gains / (losses)
(259,394)
25,374
Payments
(136,338)
(122,563)
Expected return on plan assets
72,988
38,606
Amount transferred to the Fund resulting from acquired rights unassigned
related to the Complementary Plan
6
586
Others
\u2014
(33)
Balance at the end of the year
3,384,118
3,699,988
(Thousands of euros)
2022
2021
Asset class
Assets with
market price in
active market
Remaining
Total
Portfolio
Assets with
market price in
active market
Remaining
Total
Portfolio
Shares
96,817
1,183
98,000
397,322
1,098
398,420
Bonds and other fixed income
securities
1,120,132
\u2014
1,120,132
1,377,330
4,820
1,382,150
Participations units in
investment funds
\u2014
969,232
969,232
\u2014
1,186,146
1,186,146
Participation units in real
estate funds
\u2014
308,404
308,404
\u2014
304,736
304,736
Properties
\u2014
275,493
275,493
\u2014
239,838
239,838
Loans and advances to credit
institutions and others
\u2014
612,857
612,857
\u2014
188,698
188,698
1,216,949
2,167,169
3,384,118
1,774,652
1,925,336
3,699,988
As at 31 December 2022, the balance Properties includes buildings booked in the Fund's financial statements and used
by the Group's companies which amounts to Euros 275,493,000 (31 December 2021: Euros 239,838,000).
The securities issued by Group's companies accounted in the portfolio of the Fund are analysed as follows:
(Thousands of euros)
2022
2021
Shares
4,301
4,140
Bonds and other fixed income securities
2,805
15,386
Loans and advances to credit institutions and others
128,476
170,115
135,582
189,641
Social Security System (RGSS) with effect from 1 January 2011. The integration led to an effective decrease in the
present value of the total benefits reported at the retirement age to be borne by the Pension Fund, and this effect is
recorded on a straight-line basis over the average period of active life until the normal retirement age is reached. The
calculation of the liability for pensions carried out periodically by the actuary considers this effect and is calculated
considering the actuarial assumptions in force, ensuring that the liabilities calculated with reference to 31 December
2010, not considering the effect of the integration of bank employees into the General Social Security Scheme are fully
covered and deducted from the amount of the effect recognised until the date. The component of this effect for the
year is recognised under the heading \"Current service costs\".
Board of Directors Plan
As the Board of Directors Retirement Regulation establish that the pensions are subjected to an annual update, and as
it is not common in the insurance market the acquisition of perpetual annuities including variable updates in pensions,
the Bank determined, the liability to be recognised on the financial statements related to that update, taking into
consideration current actuarial assumptions.
In accordance with the remuneration policy of the Board Members, the Group has the responsibility of supporting the
cost with: i) the retirement pensions of former Group's Executive Board Members; and ii) the Complementary Plan for
these members in accordance with the applicable rules funded through the Pension Fund, Extra-fund and perpetual
annuities.
In order to cover liabilities with pensions to former members of the Executive Board of Directors, under the Bank's
Board of Directors Retirement Regulation the Bank contracted with Ocidental Vida to purchase immediate life annuity
insurance policies.
Assumptions used in the liability's assessment
Considering the market indicators, particularly the inflation rate estimates and the long-term interest rate for Euro
Zone, as well as the demographic characteristics of its employees, the Group considered the following actuarial
assumptions for calculating the liabilities with pension obligations:
2022
2021
Salary growth rate (c)
3,75% in 2023; 2,25% in\u00a0
2024 and 1% in the
following years
0.75%
Pension's growth rate (c)
3,5% in 2023; 2% in\u00a0 2024
and 0.75% in the following
years
0.50%
Discount rate / Projected Fund's rate of return
4.17%
1.35%
Mortality tables
Men
TV 88/90 less a year
TV 88/90
Women (a)
TV 99/01 less 2 years
TV 88/90 less 3 years
Disability rate
Non applicable
Non applicable
Turnover rate
Non applicable
Non applicable
Normal retirement age (b)
66 years and 7 months
66 years and 6 months
Total salary growth rate for Social Security purposes
1.75%
1.75%
Revaluation rate of wages / pensions of Social Security
1%
1%
employees and managers, was determined based on an analysis carried out on a set of available information, which
includes, among other elements, the market references for this indicator published by internationally recognized
specialized entities and which are based, as defined by IAS 19, on market yields of a universe of high quality bond
issues (low risk), different maturities, called in Euros and relating to a diverse and representative range of issuers (non-
sovereign). With reference to 31 December 2022, the Group used a discount rate of 4.17%% (31 December 2021: 1.35%
%).
The Actuarial gains are related to the difference between the actuarial assumptions used for the estimation of the
liabilities and the values verified and the change in actuarial assumptions, are analysed as follows:
(Thousands of euros)
Actuarial (gains) / losses
2022
2021
Values
effectively
verified in %
Amount
of
deviations
Values
effectively
verified in %
Amount
of
deviations
Deviation between expected and actual liabilities
58,590
57,564
Changes on the assumptions:
Discount rate
(1,108,506)
(167,475)
\u00a0 Salary and pensions growth rate
279,108
\u2014
\u00a0 Mortality tables
63,571
\u2014
\u00a0 Other changes
72,154
\u2014
Deviation between expected income and income from funds
-5.07%
259,394
1.92%
(25,374)
\u2014
(375,689)
\u2014
(135,285)
(98,276)
102,703
(143,548)
151,248
Salary growth rate
(20,620)
23,675
(32,795)
35,922
(Thousands of euros)
Impact resulting from changes in demographic assumptions
2022
2021
- 1 year
+ 1 year
- 1 year
+ 1 year
Changes in mortality table (*)
83,017
(83,816)
128,401
(127,687)
(*) The impact of 1 year reduction in the mortality table implies an increase in the average life expectancy
Defined contribution plan
According to what is described in accounting policy 1 R3, in the scope of the Defined Contribution Plan provided for the
BCP Pension Fund of the BCP Group for employees who have been admitted until 1 July 2009, in 2022 was accounted for
a cost of Euros 2 million as an estimated contribution given that the Group estimates that the following requirements
will me met, cumulatively: (i) the previous year BCP's ROE equals or exceeds the rate of government bonds of 10 years
plus 5 percentage points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
No contributions were made in 2021.
For employees who have been admitted after 1 July 2009, are made monthly contributions equal to 1.5% of the monthly
remuneration received by employees in the current month, either by themselves or by the Group and employees. This
contribution has a mandatory character and is defined in the Collective Labour Agreement of the BCP Group and does
not have a performance criterion. The Group accounted for staff costs in 2022 the amount of Euros 307,000 (2021:
Euros 268,000) related to this contribution.
Related parties
As defined by IAS 24, are considered related parties of the Group, the companies detailed in note 60 - List of subsidiary
and associated companies of Banco Comercial Portugu\u00eas Group, the Pension Fund, the members of the Board of
Directors and key management members. The key management members are the first line Directors. Beyond the
members of the Board of Directors and key management members, are also considered related parties, people who are
close to them (family relationships) and entities controlled by them or in whose management they have significant
influence.
As the transactions with subsidiaries are eliminated in consolidation, these are not included in the notes to the Group's
consolidated financial statements.
According to Portuguese law, namely under Article no. 109 of the General Law for Credit Institutions and Financial
Companies and also in accordance with Article no. 33 of Notice 3/2020 of the Bank of Portugal, are considered related
parties as well, the qualified shareholders of Banco Comercial Portugu\u00eas, S.A. and the entities controlled by them or
with which they are in a group relationship. Under the scope of the Portuguese Securities Code update, which came
into force at the beginning of 2022, the reference threshold of 2% for qualifying holdings was changed to 5%. With
reference to 2021 financial year, the reported balances refer to qualifying holdings above 2%, in accordance with the
Securities Code in force at the date. The list of the qualified shareholders is detailed in note 41.
A)Balances and transactions with qualified shareholders
The balances reflected in assets of consolidated balance sheet with qualified shareholders, are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Financial assets at amortised cost
Loans and advances to customers
97,744
148,916
Debt securities
79,787
79,673
Financial assets at fair value through profit or loss
Financial assets held for trading
\u2014
2,881
Financial assets at fair value through other comprehensive income
\u2014
136,849
Others
\u2014
48
177,531
368,367
Liabilities
Resources from customers
96,159
319,137
Financial liabilities at fair value through profit or loss
Financial liabilities held for trading
4,287
\u2014
100,446
319,137
The balances with qualified shareholders, reflected in the guarantees granted and revocable and irrevocable credit
lines, are as follows:
(Thousands of euros)
2022
2021
Guarantees granted
2,273
48,060
Revocable credit lines
18,171
143,225
Irrevocable credit lines
\u2014
150,000
20,444
341,285
In 2022, the Group has accounted for provisions for Guarantees granted the amount of Euros 3,000 (31 December 2021:
Euros 86,000), for Revocable credit lines the amount of Euros 229,000 (31 December 2021: Euros 184,000). As at 31
December 2021, were also accounted for provisions for irrevocable credit lines in the amount of\u00a0 Euros 26,000.
B)Balances and transactions with members of the Board of Directors and key management
members
The balances with related parties discriminated in the following table, included on the consolidated balance sheet, are
analysed as follows:
(Thousands of euros)
Loans and advances to customers
Resources from customers
2022
2021
2022
2021
Board of Directors
Non-executive directors
10
2
8,180
7,272
Executive Committee (*)
46
65
2,716
1,628
Closely related people
14
230
2,629
2,210
Controlled entities
\u2014
\u2014
24
45
Key management members
Key management members
6,575
6,114
10,180
9,996
Closely related people
2,475
1,146
4,497
5,224
Controlled entities
928
2
2,613
2,232
10,048
7,559
30,839
28,607
(*) The item Loans to Customers corresponds to mortgage loans granted prior to the respective election and to the
amount used from private credit cards which must be settled on the maturity date.
In accordance with Article 85, no. 9 of RGICSF, no credits were granted during 2022 and 2021.
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in income items
of the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar income
Commissions income
2022
2021
2022
2021
Board of Directors
Non-executive directors
\u2014
\u2014
29
46
Executive Committee
\u2014
\u2014
10
9
Closely related people
\u2014
3
9
6
Key management members
Key management members
41
23
62
62
Closely related people
22
9
43
38
Controlled entities
17
\u2014
19
8
80
35
172
169
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in cost items of
the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar expense
Commissions' expense
2022
2021
2022
2021
Board of Directors
Non-executive directors
19
4
\u2014
1
Executive Committee
\u2014
\u2014
1
\u2014
Closely related people
9
1
\u2014
\u2014
Key management members
Key management members
6
6
4
4
Closely related people
2
1
2
1
Controlled entities
\u2014
\u2014
2
2
36
12
9
8
(*) Corresponds to the maximum authorized and unused limit of private credit cards and overdraft authorization in a
salary account under the same regime as all the Bank's other employees.
The shareholder and bondholder position of members of the Board of Directors, Key management members and people
closely related to the previous categories, as well as the movements occurred during 2022, are as follows:
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2022
2021
Acquisitions
Disposals
Date
MEMBERS OF BOARD OF DIRECTORS
Altina de F\u00e1tima Sebasti\u00e1n Gonz\u00e1lez Villamarin
BCP Shares
0
0
Ana Paula Alcobia Gray
BCP Shares
0
0
Cid\u00e1lia Maria da Mota Lopes
BCP Shares
2,184
2,184
Fernando da Costa Lima
BCP Shares
18,986
18,986
Jo\u00e3o Nuno Oliveira Jorge Palma
BCP Shares
1,364,642
426,957
1,662,562
(a)
724,877
(b)
24/6/2022
0.1775
Jorge Manuel Baptista Magalh\u00e3es Correia
BCP Shares
88,500
88,500
Bonds (i)
1
1
Bonds (ii)
1
1
Jos\u00e9 Miguel Bensliman Schorcht da Silva
Pessanha
BCP Shares
1,177,152
333,829
1,500,574
(a)
657,251
(b)
24/6/2022
0.1775
Jos\u00e9 Pedro Rivera Ferreira Malaquias
BCP Shares
9,808
9,808
J\u00falia Gu (Xiao Xu Gu)
BCP Shares
0
0
Lingjiang Xu
BCP Shares
0
0
Lingzi Yuan (Smilla Yuan)
BCP Shares
0
0
Maria Jos\u00e9 Henriques Barreto de Matos de
Campos
BCP Shares
1,554,512
396,914
1,446,998
(a)
289,400
(b)
24/6/2022
0.1775
Miguel de Campos Pereira de Bragan\u00e7a
BCP Shares
1,725,908
763,422
1,685,613
(a)
723,127
(b)
24/6/2022
0.1775
Miguel Maya Dias Pinheiro
BCP Shares
2,018,854
800,692
2,118,541
(a)
900,379
(b)
24/6/2022
0.1775
Nuno Manuel da Silva Amado
BCP Shares
1,525,388
1,525,388
Bonds (i)
2
2
Bonds (ii)
2
2
Bonds (iii)
1
0
1
7/11/2022
100,000
Rui Manuel da Silva Teixeira
BCP Shares
1,207,858
376,663
1,478,995
(a)
647,800
(b)
24/6/2022
0.1775
Valter Rui Dias de Barros
BCP Shares
0
0
KEY MANAGEMENT MEMBERS
Albino Ant\u00f3nio Carneiro de Andrade
BCP Shares
128,684
101,557
27,127
(a)
24/6/2022
0.1775
Alexandre Manuel Casimiro de Almeida
BCP Shares
111,400
55,865
55,535
(a)
24/6/2022
0.1775
Am\u00e9rico Jo\u00e3o Pinto Carola
BCP Shares
104,945
61,269
77,439
(a)
33,763
(b)
24/6/2022
0.1775
Ana Maria Jord\u00e3o F. Torres Marques Tavares
BCP Shares
215,340
161,758
84,249
(a)
30,667
(b)
24/6/2022
0.1775
Ana Patr\u00edcia Moniz Macedo
BCP Shares
0
0
Andr\u00e9 Cardoso Meneses Navarro
BCP Shares
148,020
106,697
55,098
(a)
13,775
(b)
24/6/2022
0.1775
Ant\u00f3nio Augusto Amaral de Medeiros
BCP Shares
143,063
100,077
76,485
(a)
33,499
(b)
24/6/2022
0.1775
Ant\u00f3nio Ferreira Pinto J\u00fanior
BCP Shares
33,187
27,266
1/4/2022
0.1492
11,842
5,921
(a)
24/6/2022
0.1775
Ant\u00f3nio Jos\u00e9 Lindeiro Cordeiro
BCP Shares
64,134
32,631
52,770
(a)
21,267
(b)
24/6/2022
0.1775
Ant\u00f3nio Lu\u00eds Duarte Bandeira
BCP Shares
285,425
236,233
87,529
(a)
38,337
(b)
24/6/2022
0.1775
Ant\u00f3nio Ricardo Fery Salgueiro Antunes
BCP Shares
61,361
15,035
46,326
(a)
24/6/2022
0.1775
Ant\u00f3nio V\u00edtor Martins Monteiro
BCP Shares
3,872
3,872
(i) - Tejo Project - Fixed Rate Reset Perpetual Temporary Write Down Additional Tier 1 Capital Notes
(ii) - BCP Tier 2 Subordinated Callable Notes
(iii) - BCP 1.75% EUR 500M 6.5NC5.5 Social Senior Preferred Notes
(a) - identifies the increment of shares up to 31 December 2022 corresponding to variable compensation of 2021 and deferred from previous years
(b) - identifies the shares used in sell-cover up to 31 December 2022 related to the increment of shares of variable remuneration.
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2022
2021
Acquisitions
Disposals
Date
Artur Frederico Silva Luna Pais
BCP Shares
459,405
396,760
62,645
(a)
24/6/2022
0.1775
Belmira Abreu Cabral
BCP Shares
96,604
57,285
62,410
(a)
23,091
(b)
24/6/2022
0.1775
Bernardo Roquette de Arag\u00e3o de Portugal
Colla\u00e7o
BCP Shares
54,362
25,999
49,673
(a)
21,310
(b)
24/6/2022
0.1775
Chi Wai Leung (Timothy)
BCP Shares
26,582
9,852
16,730
(a)
24/6/2022
0.1775
Constantino Alves Mousinho
BCP Shares
40,664
19,591
(a)
24/6/2022
0.1775
72,352
12,097
(a)
25/11/2022
0.1525
Fernando Maria Cardoso Rodrigues Bicho
BCP Shares
237
237
Filipe Maria de Sousa Ferreira Abecasis
BCP Shares
135,398
85,467
87,446
(a)
37,515
(b)
24/6/2022
0.1775
Francisco Ant\u00f3nio Caspa Monteiro
BCP Shares
186,219
137,027
87,529
(a)
38,337
(b)
24/6/2022
0.1775
Gon\u00e7alo Nuno Belo de Almeida Pascoal
BCP Shares
119,771
78,390
72,471
(a)
31,090
(b)
24/6/2022
0.1775
Hugo Miguel Martins Resende
BCP Shares
139,589
92,696
83,143
(a)
36,250
(b)
24/6/2022
0.1775
Jo\u00e3o Br\u00e1s Jorge
BCP Shares
91,709
91,709
Jo\u00e3o Manuel Rodrigues Tom\u00e9 Cunha Martins
BCP Shares
0
0
Jo\u00e3o Manuel Taveira Pinto Santos Paiva
BCP Shares
190,677
103,739
86,938
(a)
24/6/2022
0.1775
Jorge Filipe Nogueira Freire Cortes Martins
BCP Shares
38,003
79,632
(a)
31,375
(b)
24/6/2022
0.1775
48,257
38,003
6/7/2022
0.1454
Jorge Manuel Machado de Sousa G\u00f3is
BCP Shares
134,204
73,203
61,001
(a)
24/6/2022
0.1775
Jorge Manuel Magalh\u00e3es Oliveira Pereira
BCP Shares
25,460
0
44,355
(a)
18,895
(b)
24/6/2022
0.1775
Jorge Manuel Nobre Carreteiro
BCP Shares
55,988
27,648
47,471
(a)
19,131
(b)
24/6/2022
0.1775
Jorge Oct\u00e1vio Neto dos Santos
BCP Shares
471,191
471,191
Jos\u00e9 Artur Gouveia Coelho Caetano
BCP Shares
0
0
Jos\u00e9 Carlos Benito Garcia de Oliveira
BCP Shares
37,941
37,941
Jos\u00e9 Gon\u00e7alo Prior Regalado\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0
BCP Shares
163,020
83,836
79,184
(a)
24/6/2022
0.1775
Jos\u00e9 Guilherme Potier Raposo Pulido Valente
BCP Shares
280,081
208,437
71,644
(a)
24/6/2022
0.1775
Jos\u00e9 Laurindo Reino da Costa
BCP Shares
751,100
401,100
4/1/2022
0.1502
150,000
3/6/2022
0.1953
50,000
150,000
3/11/2022
0.1531
Jos\u00e9 Maria Gon\u00e7alves Pereira Brand\u00e3o de
Brito
BCP Shares
55,225
23,878
50,076
(a)
18,729
(b)
24/6/2022
0.1775
Luis Miguel Manso Correia dos Santos
BCP Shares
216,790
125,615
91,175
(a)
24/6/2022
0.1775
Maria Constan\u00e7a C. Brand\u00e3o Amado Fonseca
G. Santos
BCP Shares
800
800
Maria de F\u00e1tima Coelho Dias
BCP Shares
0
0
Maria de Los Angeles Sanchez Sanchez
BCP Shares
19,191
23,029
(a)
9,649
(b)
24/6/2022
0.1775
41,011
14,113
(a)
5,673
(b)
25/11/2022
0.1525
Maria Helena Soledade Nunes Henriques
BCP Shares
232,863
199,002
60,250
(a)
26,389
(b)
24/6/2022
0.1775
Maria Manuela de Ara\u00fajo Mesquita Reis
BCP Shares
190,663
152,857
63,327
(a)
25,521
(b)
24/6/2022
0.1775
Maria Rita S\u00edtima Fonseca Louren\u00e7o
BCP Shares
173,448
112,778
60,670
(a)
24/6/2022
0.1775
M\u00e1rio Ant\u00f3nio Pinho Gaspar Neves
BCP Shares
108,172
73,963
60,762
(a)
26,553
(b)
24/6/2022
0.1775
M\u00e1rio Madeira Robalo Fernandes
BCP Shares
156,951
79,512
77,439
(a)
24/6/2022
0.1775
Nelson Lu\u00eds Vieira Teixeira
BCP Shares
108,936
59,343
86,855
(a)
37,262
(b)
24/6/2022
0.1775
Nuno Alexandre Ferreira Pereira Alves
BCP Shares
183,959
101,156
82,803
(a)
24/6/2022
0.1775
Nuno Miguel Nobre Botelho
BCP Shares
33,366
72,259
(a)
24/6/2022
0.1775
85,625
20,000
29/8/2022
0.1400
Pedro Jos\u00e9 Mora de Paiva Beija
BCP Shares
107,673
28,000
18/5/2022
0.1720
29,000
20/5/2022
0.1700
138,202
87,529
(a)
24/062022
0.1775
(a) - identifies the increment of shares up to 31 December 2022 corresponding to variable compensation of 2021 and deferred from previous years.
(b) - identifies the shares used in sell-cover up to 31 December 2022 related to the increment of shares of variable remuneration.
(c) - solidary ownership in both securities accounts, and Dr. Ricardo Campos is the first holder and Eng.\u00aa Maria Jos\u00e9 Campos is the 2nd holder of the
securities account.
C)Balances and transactions with associated companies
The balances with associated companies included in the consolidated balance sheet items, except for the item
investments in associated companies, are as follows:
(Thousands of euros)
2022
2021
Assets
Loans and advances to credit institutions repayable on demand
8,834
2,130
Financial assets at amortised cost
Loans and advances to credit institutions
206,078
18,290
Loans and advances to customers
59,487
63,681
Financial assets at fair value through profit or loss
Financial assets held for trading
\u2014
35
Other assets
11,497
12,542
285,896
96,678
Liabilities
Financial liabilities at amortised cost
Resources from credit institutions
62,845
46,158
Resources from customers
211,193
346,254
Non subordinated debt securities issued
2,002
21,019
Financial liabilities held for trading
3,894
96,536
Other liabilities
8
51
279,942
510,018
The guarantees granted and revocable and irrevocable credit lines by the Group over associated companies are as
follows:
(Thousands of euros)
2022
2021
Guarantees granted
7,539
7,453
Revocable credit lines
9,527
335,367
Irrevocable credit lines
\u2014
600
17,066
343,420
Under the scope of the Group's insurance mediation activities, the remuneration from services provided is analysed as
follows:\u00a0
(Thousands of euros)
2022
2021
Life insurance
Saving products
27,966
32,101
Mortgage and consumer loans
20,699
19,333
Others
\u2014
30
48,665
51,464
Non-Life insurance
Accidents and health
21,612
20,144
Motor
3,956
4,078
Multi-Risk Housing
7,753
7,392
Others
1,660
1,549
34,981
33,163
83,646
84,627
In 2022 and 2021, there were no transactions related to other financial instruments between the Group and the Pension
Fund.
In 2022 and 2021, income and expenses with the Pension Fund included in the items of the consolidated income
statement are as follows:
(Thousands of euros)
2022
2021
Income
Commissions
2,167
2,268
Expenses
Interest expense and similar charges
\u2014
1,114
Other administrative costs
14,227
14,231
14,227
15,345
The balance Other administrative costs corresponds to rents incurred under the scope of the Pension Fund's properties
in which the tenant is the Group.
As at 31 December 2022 and 2021, the guarantees granted by the Group to the Pension Fund amount to Euros 5,000.
Consolidated Balance sheet and Income statement by geographic and
operational segments
The segments presented are in accordance with IFRS 8. In accordance with the Group's management model, the
segments presented correspond to the segments used for management purposes by the Executive Committee. The
Group offers a wide range of banking activities and financial services in Portugal and abroad, with a special focus on
Commercial Banking, Companies Banking and Private Banking.
Segments description
A.Geographical Segments
The Group operates in the Portuguese market, and also in a few affinity markets with recognised growth potential.
Considering this, the geographical segments are structured in Portugal and Foreign Business (Poland, Mozambique and
Other). Portugal segment reflects, essentially, the activities carried out by Banco Comercial Portugu\u00eas in Portugal and
ActivoBank.
Portugal activity includes the following segments: i) Retail Banking; ii) Companies, Corporate & Investment Banking; iii)
Private Banking and iv) Other.
Retail Banking includes the following business areas:
- Retail network, which ensures the monitoring of individual customers, entrepreneurs, merchants and small and
medium enterprises with a turnover less than Euros 2.5 million. The Retail network strategic approach is to target
\u201cMass Market\u201d customers, who appreciate a value proposal based on innovation and speed, as well as Prestige and
Small Business customers, whose specific characteristics, financial assets or income imply a value proposal based on
innovation and personalisation, requiring a dedicated Account Manager;
- Retail Recovery Division that accompanies and manages the responsibilities of customers or economic groups in
effective default, as well as customers with bankruptcy requirement or other similar mechanisms, looking through the
conclusion of agreements or payment restructuring processes that minimizes the economic loss to the Bank; and
- ActivoBank, a bank focused on clients who are young, intensive users of new communication technologies and who
prefer a banking relationship based on simplicity, offering modern products and services.
Companies, Corporate and Investment Banking segment includes:
- Companies and Corporate network, which monitors clients included in the corporate segment, economic groups and
institutional entities, with a turnover higher than Euros 2.5 million, offering a wide range of traditional banking
products complemented by specialised financing;
- Large Corporate network that assures the relationship and the monitoring of a set of Groups / Clients, which in
addition to Portugal, develop their activity in several geographies (Poland, Angola, Mozambique and East), providing a
complete range of value-added products and services;
- Specialised Monitoring Division which carries out the monitorisation of business groups that have high and complex
credit exposures or that show relevant signs of impairment, in order to defend the value and managing credit risk, in
a sustainable medium and long term perspective;
- Investment Banking unit, that ensures the offer of products and specific services, in particular financial advice,
including corporate finance services, capital market transactions and analysis and financing structuring in the medium
to long term;
- Trade Finance Department (from Marketing Division for Corporate, Business and Institutional since the end of 2021),
which coordinates the business with banks and financial institutions, boosting international business with the
commercial networks of the Bank and institutional custody services for securities;
- Specialised Recovery Division which ensures efficient tracking of customers with predictable or effective high risk of
credit, from Companies, Corporate, Large Corporate and retail networks (exposure exceeding Euros 1 million);
- Interfundos with the activity of management of real estate investment funds.
The Private Banking segment, for the purposes of geographical segments, comprises:
- Private Banking Division in Portugal, which ensures the monitoring of clients with high net worth, based on a
commitment to excellence and a personalized relationship with clients;
- Wealth Management Division, which provides advisory services and portfolio management for clients in the Private
Banking network and the affluent segment.
For the purposes of business segments also includes Banque Priv\u00e9e BCP in Switzerland and Millennium bcp Bank & Trust
in Cayman Islands (entity liquidated in 2022) that are considered Foreign Business on geographical segmentation. It
should be noted that the result generated by the subsidiary in Switzerland and the capital gain generated by
discontinuing this operation, as well as its adjustments occurred in 2022, are recorded in a single line as results of
discontinued or discontinuing operations.
All other businesses not previously discriminated are allocated to the Other segment (Portugal) and include centralized
management of financial investments, corporate activities and operations not integrated in the remaining business
segments and other amounts not allocated to segments.
Foreign Business includes the following segments:
- Poland, where the Group is represented by Bank Millennium, a universal bank offering a wide range of financial
products and services to individuals and companies nationwide;
- Mozambique, where the Group is represented by BIM \u2013 Banco Internacional de Mo\u00e7ambique, a universal bank targeting
companies and individual customers; and
- Other, which includes the contribution of the associate in Angola and the contribution of the discontinued operations
in Switzerland and Cayman Islands.
B.Business Segments
For the purposes of business segments reporting, Foreign Business segment comprises the Group\u2019s operations developed
in other countries already mentioned excluding the activity of Banque Priv\u00e9e BCP in Switzerland and Millennium bcp
Bank & Trust in the Cayman Islands which, in this context, are considered in Private Banking segment.
Business segments activity
The figures reported for each segment resulted from aggregating the subsidiaries and business units integrated in each
segment. For the business units in Portugal, the aggregation process reflects the impact from capital allocation and
balancing process in the balance sheet and income statement, based on average figures. The balance sheet headings
for each business unit and Portuguese subsidiaries were re-calculated, considering the replacement of the equity book
values by the amounts assigned through the allocation process, based on the regulatory solvency criteria.
Considering that the process of capital allocation complies with the regulatory criteria of solvency in force, as at 31
December 2022 and 31 December 2021 the risk weighted assets, and consequently the capital allocated to the business
segments, are determined in accordance with the Basel III framework, pursuant to the CRD IV/CRR. The capital
allocated to each segment resulted from the application of a target capital ratio to the risks managed by each segment,
reflecting the application of the Basel III methodology previously referred. Each operation is balanced through internal
transfers of funds, with impact on the net interest income and income taxes of each segment, hence with no impact on
consolidated accounts.
Commissions and other net income, as well as operating costs calculated for each business area, are based on the
amounts accounted for directly in the respective cost centres, on the one hand, and the amounts resulting from
internal processes for allocating revenues and costs, for another. In this case, the allocation is based on the application
of pre-defined criteria related to the level of activity of each business area.
The following information has been prepared based on the individual and consolidated financial statements of the
Group prepared in accordance with international financial reporting standards (IFRS), as adopted by the European
Union (EU), at the reference date and with the Organization of the Group's business areas in force on 31 December
2022. Information relating to prior periods is restated whenever it occurs changes in the internal organization of the
entity susceptible to change the composition of the reportable segments (business and geographical) or relevant
changes in the dynamics of allocation of indirect revenues and costs, as described in the previous paragraph, ensuring
the comparability of the information provided in the reported periods.
Following the sale of the entire share capital of Banque Priv\u00e9e BCP (Suisse) SA (\u201cBanque Priv\u00e9e\u201d) to the Union Bancaire
Priv\u00e9e, UBP SA, the contribution of this subsidiary to the \"Private Banking\" segment (geographical segments) and \"Other\"
from \"Foreign business\" segment (business segments) is reflected as income from discontinued operations. Banque
Priv\u00e9e BCP (Suisse) S.A. ceased to be part of the BCP Group on 2 November 2021, the date on which the sale of this
subsidiary was completed. In this context, the capital gain arising from the sale of the operation and its adjustments
occurred in 2022 were also recorded as income from discontinued operations. It should also be noted that on 29
December 2021, BIM \u2013 Banco Internacional de Mo\u00e7ambique, S.A. also formalized the sale to Fidelidade of shares
representing 70% of the share capital and voting rights of Seguradora Internacional de Mo\u00e7ambique, S.A., with BIM
maintaining approximately 22% of its share capital. The contribution of this subsidiary to the net income of the Foreign
Business segment is also presented as income of discontinued or discontinued operations as at December 2021, as
required by IFRS 5. The presentation of assets and liabilities of Banque Priv\u00e9e BCP (Suisse) S.A. and Seguradora
Internacional de Mo\u00e7ambique, S.A. referring to previous periods remained unchanged when compared to the criteria
considered in the preparation of the consolidated financial statements previously disclosed.
The information in the financial statements of reportable segments is reconciled, at the level of the total revenue of
those same segments, with the revenue from the demonstration of the consolidated financial position of the reportable
entity for each date on which is lodged a statement of financial position.
As at 31 December 2022, the net contribution of the major business segments, for the income statement, is analysed as
follows:
(Thousands of euros)
2022
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
(1)
Total
Private
banking
Other
Consolidated
INCOME STATEMENT
Interest and similar income
554,723
1,658,474
2,213,197
296,748
12,665
214,625
2,737,235
Interest expense and similar charges
(8,160)
(460,653)
(468,813)
(33,597)
(3,135)
(81,918)
(587,463)
Net interest income
546,563
1,197,821
1,744,384
263,151
9,530
132,707
2,149,772
Commissions and other income
481,546
321,666
803,212
198,406
43,261
4,768
1,049,647
Commissions and other costs
(55,517)
(219,667)
(275,184)
(30,057)
(2,147)
(153,377)
(460,765)
Net commissions and other income (2)
426,029
101,999
528,028
168,349
41,114
(148,609)
588,882
Net gains arising from trading activity
(3)
20,220
(19,299)
921
387
2,106
46,546
49,960
Share of profit of associates under the
equity method
\u2014
925
925
\u2014
\u2014
67,797
68,722
Gains/(losses) arising from the sale of
subsidiaries and other assets
\u2014
3,501
3,501
7
(1)
6,660
10,167
Net operating revenue
992,812
1,284,947
2,277,759
431,894
52,749
105,101
2,867,503
Operating expenses
460,918
470,346
931,264
102,948
22,324
16,482
1,073,018
Results on modification (4)
\u2014
(309,865)
(309,865)
\u2014
\u2014
\u2014
(309,865)
Impairment for credit and financial
assets (5)
(65,993)
(82,395)
(148,388)
(181,937)
594
33,602
(296,129)
Other impairments and provisions (6)
(158)
(550,085)
(550,243)
\u2014
\u2014
(209,790)
(760,033)
Net income before income tax
465,743
(127,744)
337,999
147,009
31,019
(87,569)
428,458
Income tax
(144,633)
(96,742)
(241,375)
(45,814)
(9,690)
(7,441)
(304,320)
Net income after income tax
from continuing operations
321,110
(224,486)
96,624
101,195
21,329
(95,010)
124,138
Income arising from discontinued
operations
\u2014
3,772
3,772
\u2014
1,765
\u2014
5,537
Net income for the year
321,110
(220,714)
100,396
101,195
23,094
(95,010)
129,675
Non-controlling interests
\u2014
72,802
72,802
\u2014
\u2014
5,020
77,822
Net income for the year attributable
to Bank's Shareholders
321,110
(147,912)
173,198
101,195
23,094
(89,990)
207,497
from negotiations with customers holding mortgage loans in foreign currency, hitherto accounted for in other impairments and
provisions (the amounts referring to 2021, given their immateriality in this context, were not restated).
5) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
6) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2022, the net contribution of the major operational Segments, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2022
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
Total
Private
banking
Other
Consolidated
BALANCE SHEET
Cash and Loans and advances to
credit institutions
14,454,223
3,208,230
17,662,453
1,479,714
2,610,460
(14,553,732)
7,198,895
Loans and advances to customers (1)
25,609,019
16,983,242
42,592,261
11,885,264
344,077
1,376,082
56,197,684
Financial assets (2)
2,100,135
5,458,513
7,558,648
\u2014
\u2014
12,795,575
20,354,223
Other assets
92,077
942,640
1,034,717
13,794
2,823
5,058,405
6,109,739
Total Assets
42,255,454
26,592,625
68,848,079
13,378,772
2,957,360
4,676,330
89,860,541
Resources from\u00a0 credit institutions
(3)
458,034
158,808
616,842
1,799,496
\u2014
(947,978)
1,468,360
Resources from customers (4)
39,318,562
23,173,054
62,491,616
10,577,717
2,734,372
103,109
75,906,814
Debt securities issued (5)
1,217,830
52,066
1,269,896
1,953
133,094
1,418,150
2,823,093
Other financial liabilities (6)
\u2014
535,648
535,648
\u2014
\u2014
1,216,914
1,752,562
Other liabilities (7)
51,224
907,471
958,695
69,045
1,058
960,349
1,989,147
Total Liabilities
41,045,650
24,827,047
65,872,697
12,448,211
2,868,524
2,750,544
83,939,976
Total Equity
1,209,804
1,765,578
2,975,382
930,561
88,836
1,925,786
5,920,565
Total Liabilities and Equity
42,255,454
26,592,625
68,848,079
13,378,772
2,957,360
4,676,330
89,860,541
Number of employees
3,814
9,491
13,305
522
137
1,779
15,743
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value
through profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive
income, assets with repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer
deposits at fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt
securities and certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2021, the net contribution of the major business segments, for the income statement, is analysed as
follows:
(Thousands of euros)
2021
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Private
banking
Other
Consolidated
Retail in
Portugal
Foreign
business
(1)
Total
INCOME STATEMENT
Interest and similar income
452,648
845,017
1,297,665
265,752
8,615
137,092
1,709,124
Interest expense and similar charges
(4,683)
(90,848)
(95,531)
(6,317)
(1,117)
(17,558)
(120,523)
Net interest income
447,965
754,169
1,202,134
259,435
7,498
119,534
1,588,601
Commissions and other income
462,357
326,399
788,756
165,373
36,517
(4,042)
986,604
Commissions and other costs
(52,274)
(171,744)
(224,018)
(20,248)
(3,188)
(139,394)
(386,848)
Net commissions and other income (2)
410,083
154,655
564,738
145,125
33,329
(143,436)
599,756
Net gains arising from trading activity (3)
18,449
10,968
29,417
286
1,391
55,444
86,538
Share of profit of associates under the
equity method
\u2014
(1,380)
(1,380)
\u2014
\u2014
58,317
56,937
Gains/(losses) arising from the sale of
subsidiaries and other assets
\u2014
402
402
4
\u2014
2,164
2,570
Net operating revenue
876,497
918,814
1,795,311
404,850
42,218
92,023
2,334,402
Operating expenses
469,851
421,815
891,666
111,207
22,047
90,678
1,115,598
Impairment for credit and financial
assets (4)
(75,370)
(77,259)
(152,629)
(150,831)
3,005
(56,120)
(356,575)
Other impairments and provisions (5)
(69)
(545,123)
(545,192)
\u2014
\u2014
(159,300)
(704,492)
Net income before income tax
331,207
(125,383)
205,824
142,812
23,176
(214,075)
157,737
Income tax
(103,402)
(94,583)
(197,985)
(44,722)
(6,960)
46,041
(203,626)
Net income after income tax
from continuing operations
227,805
(219,966)
7,839
98,090
16,216
(168,034)
(45,889)
Income arising from discontinued
operations
\u2014
18,587
18,587
\u2014
52,294
\u2014
70,881
Net income for the year
227,805
(201,379)
26,426
98,090
68,510
(168,034)
24,992
Non-controlling interests\u00a0 (6)
\u2014
113,291
113,291
\u2014
\u2014
(201)
113,090
Net income for the year attributable
to Bank's Shareholders
227,805
(88,088)
139,717
98,090
68,510
(168,235)
138,082
1) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
2) Includes net fees and commissions income, other operating income/(loss), net gains from insurance activity and dividends from
equity instruments.
3) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge
accounting operations, results from derecognition of financial assets and financial liabilities measured at amortised cost and results
from derecognition of financial assets measured at fair value through other comprehensive income.
4) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
5) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
6) Includes the non-controlling interests of BIM Group related to Seguradora Internacional de Mo\u00e7ambique, S.A., entity classified as a
discontinued operation
As at 31 December 2021, the net contribution of the major operational Segments, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2021
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
Total
Private
banking
Other
Consolidated
BALANCE SHEET
Cash and Loans and advances to
credit institutions
12,164,325
1,563,577
13,727,902
1,589,469
2,779,056
(9,485,129)
8,611,298
Loans and advances to customers (1)
25,010,925
17,780,147
42,791,072
12,077,141
344,222
1,147,494
56,359,929
Financial assets (2)
1,222,529
5,089,223
6,311,752
\u2014
5,022
15,423,364
21,740,138
Other assets
69,403
928,378
997,781
7,933
1,741
5,185,992
6,193,447
Total Assets
38,467,182
25,361,325
63,828,507
13,674,543
3,130,041
12,271,721
92,904,812
Resources from\u00a0 credit institutions (3)
362,803
124,346
487,149
3,107,835
\u2014
5,301,090
8,896,074
Resources from customers (4)
35,416,593
21,847,825
57,264,418
9,287,187
2,555,177
453,445
69,560,227
Debt securities issued (5)
1,396,658
8,632
1,405,290
1,418
165,410
2,198,023
3,770,141
Other financial liabilities (6)
\u2014
501,480
501,480
\u2014
\u2014
1,501,747
2,003,227
Other liabilities (7)
46,338
693,806
740,144
61,480
1,041
810,421
1,613,086
Total Liabilities
37,222,392
23,176,089
60,398,481
12,457,920
2,721,628
10,264,726
85,842,755
Total Equity
1,244,790
2,185,236
3,430,026
1,216,623
408,413
2,006,995
7,062,057
Total Liabilities and Equity
38,467,182
25,361,325
63,828,507
13,674,543
3,130,041
12,271,721
92,904,812
Number of employees
3,897
9,575
13,472
541
144
1,711
15,868
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value
through profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive
income, assets with repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer
deposits at fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt
securities and certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2022, the net contribution of the major geographic segments, for the income statement, is analysed
as follows:
(Thousands of euros)
2022
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
INCOME STATEMENT
Interest and similar income
554,723
296,748
11,693
214,625
1,077,789
1,363,784
294,690
972
2,737,235
Interest expense and similar
charges
(8,160)
(33,597)
(3,135)
(81,918)
(126,810)
(368,219)
(92,434)
\u2014
(587,463)
Net interest income
546,563
263,151
8,558
132,707
950,979
995,565
202,256
972
2,149,772
Commissions and other
income
481,546
198,406
43,229
4,768
727,949
271,358
50,308
32
1,049,647
Commissions and other costs
(55,517)
(30,057)
(2,107)
(153,377)
(241,058)
(209,600)
(10,067)
(40)
(460,765)
Net commissions and other
income (2)
426,029
168,349
41,122
(148,609)
486,891
61,758
40,241
(8)
588,882
Net gains arising from trading
activity (3)
20,220
387
2,085
46,546
69,238
(40,129)
20,830
21
49,960
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
67,797
67,797
\u2014
1,842
(917)
68,722
Gains/(losses) on disposal of
subsidiaries and other assets
\u2014
7
\u2014
6,660
6,667
2,596
904
\u2014
10,167
Net operating revenue
992,812
431,894
51,765
105,101
1,581,572
1,019,790
266,073
68
2,867,503
Operating expenses
460,918
102,948
21,401
16,482
601,749
357,092
113,255
922
1,073,018
Results on modification (4)
\u2014
\u2014
\u2014
\u2014
\u2014
(309,865)
\u2014
\u2014
(309,865)
Impairment for credit and
financial assets (5)
(65,993)
(181,937)
594
33,602
(213,734)
(74,068)
(8,327)
\u2014
(296,129)
Other impairments and
provisions (6)
(158)
\u2014
\u2014
(209,790)
(209,948)
(537,143)
(6,507)
(6,435)
(760,033)
Net income before income
tax
465,743
147,009
30,958
(87,569)
556,141
(258,378)
137,984
(7,289)
428,458
Income tax
(144,633)
(45,814)
(9,690)
(7,441)
(207,578)
(60,614)
(36,128)
\u2014
(304,320)
Net income after income tax
from continuing operations
321,110
101,195
21,268
(95,010)
348,563
(318,992)
101,856
(7,289)
124,138
Income arising from
discontinued operations
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
3,772
1,765
5,537
Net income for the year
321,110
101,195
21,268
(95,010)
348,563
(318,992)
105,628
(5,524)
129,675
Non-controlling interests
\u2014
\u2014
\u2014
5,020
5,020
108,125
(35,323)
\u2014
77,822
Net income for the year
attributable to Bank's
Shareholders
321,110
101,195
21,268
(89,990)
353,583
(210,867)
70,305
(5,524)
207,497
from negotiations with customers holding mortgage loans in foreign currency, hitherto accounted for in other impairments and
provisions (the amounts referring to 2021, given their immateriality in this context, were not restated).
5) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
6) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2022, the net contribution of the major geographic segments, for the balance sheet is analysed as
follows:
(Thousands of euros)
2022
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
14,454,223
1,479,714
2,610,460
(14,553,732)
3,990,665
2,193,520
1,014,710
\u2014
7,198,895
Loans and advances to
customers (1)
25,609,019
11,885,264
344,077
1,376,082
39,214,442
16,355,525
627,717
\u2014
56,197,684
Financial assets (2)
2,100,135
\u2014
\u2014
12,795,575
14,895,710
4,506,830
951,716
(33)
20,354,223
Other assets
92,077
13,794
2,823
5,058,405
5,167,099
641,572
230,266
70,802
6,109,739
Total Assets
42,255,454
13,378,772
2,957,360
4,676,330
63,267,916
23,697,447
2,824,409
70,769
89,860,541
Resources from other
credit institutions (3)
458,034
1,799,496
\u2014
(947,978)
1,309,552
155,411
3,397
\u2014
1,468,360
Resources from
customers (4)
39,318,562
10,577,717
2,734,372
103,109
52,733,760
20,941,241
2,231,813
\u2014
75,906,814
Debt securities issued (5)
1,217,830
1,953
133,094
1,418,150
2,771,027
52,066
\u2014
\u2014
2,823,093
Other financial liabilities
(6)
\u2014
\u2014
\u2014
1,216,914
1,216,914
535,648
\u2014
\u2014
1,752,562
Other liabilities (7)
51,224
69,045
1,058
960,349
1,081,676
839,464
68,007
\u2014
1,989,147
Total Liabilities
41,045,650
12,448,211
2,868,524
2,750,544
59,112,929
22,523,830
2,303,217
\u2014
83,939,976
Total Equity
1,209,804
930,561
88,836
1,925,786
4,154,987
1,173,617
521,192
70,769
5,920,565
Total Liabilities and
Equity
42,255,454
13,378,772
2,957,360
4,676,330
63,267,916
23,697,447
2,824,409
70,769
89,860,541
Number of employees
3,814
522
137
1,779
6,252
6,987
2,504
0
15,743
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations net of
impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through
profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income , assets with
repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer deposits at
fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2021, the net contribution of the major geographic segments, for the\u00a0 income statement, is
analysed as follows:
(Thousands of euros)
2021
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
INCOME STATEMENT
Interest and similar income
452,648
265,752
5,521
137,092
861,013
622,950
222,067
3,094
1,709,124
Interest expense and similar
charges
(4,683)
(6,317)
(1,117)
(17,558)
(29,675)
(28,264)
(62,585)
1
(120,523)
Net interest income
447,965
259,435
4,404
119,534
831,338
594,686
159,482
3,095
1,588,601
Commissions and other income
462,357
165,373
36,483
(4,042)
660,171
285,350
41,049
34
986,604
Commissions and other costs
(52,274)
(20,248)
(2,064)
(139,394)
(213,980)
(164,680)
(7,064)
(1,124)
(386,848)
Net commissions and other
income (2)
410,083
145,125
34,419
(143,436)
446,191
120,670
33,985
(1,090)
599,756
Net gains arising from trading
activity (3)
18,449
286
1,388
55,444
75,567
(5,978)
16,947
2
86,538
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
58,317
58,317
\u2014
\u2014
(1,380)
56,937
Gains/(losses) on disposal of
subsidiaries and other assets
\u2014
4
\u2014
2,164
2,168
398
4
\u2014
2,570
Net operating revenue
876,497
404,850
40,211
92,023
1,413,581
709,776
210,418
627
2,334,402
Operating expenses
469,851
111,207
21,123
90,678
692,859
330,231
91,584
924
1,115,598
Impairment for credit and
financial assets (4)
(75,370)
(150,831)
3,005
(56,120)
(279,316)
(71,365)
(5,894)
\u2014
(356,575)
Other impairments and
provisions (5)
(69)
\u2014
\u2014
(159,300)
(159,369)
(527,573)
(8,050)
(9,500)
(704,492)
Net income before income tax
331,207
142,812
22,093
(214,075)
282,037
(219,393)
104,890
(9,797)
157,737
Income tax
(103,402)
(44,722)
(6,960)
46,041
(109,043)
(72,534)
(22,049)
\u2014
(203,626)
Net income after income tax
from continuing operations
227,805
98,090
15,133
(168,034)
172,994
(291,927)
82,841
(9,797)
(45,889)
Income arising from
discontinued operations
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
18,587
52,294
70,881
Net income for the year
227,805
98,090
15,133
(168,034)
172,994
(291,927)
101,428
42,497
24,992
Non-controlling interests\u00a0 (6)
\u2014
\u2014
\u2014
(201)
(201)
145,672
(32,380)
(1)
113,090
Net income for the year
attributable to Bank's
Shareholders
227,805
98,090
15,133
(168,235)
172,793
(146,255)
69,048
42,496
138,082
1) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
2) Includes net fees and commissions income, other operating income/(loss), net gains from insurance activity and dividends from equity
instruments.
3) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations, results from derecognition of financial assets and financial liabilities measured at amortised cost and results from derecognition of
financial assets measured at fair value through other comprehensive income.
4) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net of
recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial assets at
amortised cost not associated with credit operations.
5) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
6) Includes the non-controlling interests of BIM Group related to Seguradora Internacional de Mo\u00e7ambique, S.A., entity classified as a
discontinued operation.
As at 31 December 2021, the net contribution of the major geographic segments, for the balance sheet is analysed as
follows:
(Thousands of euros)
2021
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
12,164,325
1,589,469
2,456,868
(9,485,129)
6,725,533
861,770
701,807
322,188
8,611,298
Loans and advances to
customers (1)
25,010,925
12,077,141
344,222
1,147,494
38,579,782
17,206,345
573,802
\u2014
56,359,929
Financial assets (2)
1,222,529
\u2014
\u2014
15,423,364
16,645,893
4,033,150
1,056,108
4,987
21,740,138
Other assets
69,403
7,933
1,660
5,185,992
5,264,988
672,901
194,990
60,568
6,193,447
Total Assets
38,467,182
13,674,543
2,802,750
12,271,721
67,216,196
22,774,166
2,526,707
387,743
92,904,812
Resources from other
credit institutions (3)
362,803
3,107,835
\u2014
5,301,090
8,771,728
117,674
6,672
\u2014
8,896,074
Resources from
customers (4)
35,416,593
9,287,187
2,555,177
453,445
47,712,402
19,953,653
1,894,172
\u2014
69,560,227
Debt securities issued (5)
1,396,658
1,418
165,410
2,198,023
3,761,509
8,632
\u2014
\u2014
3,770,141
Other financial
liabilities (6)
\u2014
\u2014
\u2014
1,501,747
1,501,747
501,480
\u2014
\u2014
2,003,227
Other liabilities (7)
46,338
61,480
1,021
810,421
919,260
626,847
66,959
20
1,613,086
Total Liabilities
37,222,392
12,457,920
2,721,608
10,264,726
62,666,646
21,208,286
1,967,803
20
85,842,755
Total Equity
1,244,790
1,216,623
81,142
2,006,995
4,549,550
1,565,880
558,904
387,723
7,062,057
Total Liabilities and
Equity
38,467,182
13,674,543
2,802,750
12,271,721
67,216,196
22,774,166
2,526,707
387,743
92,904,812
Number of employees
3,897
541
140
1,711
6,289
7,079
2,496
4
15,868
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations net of
impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through
profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income , assets with
repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer deposits at
fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
Reconciliation of net income of reportable segments with the net income attributable to
shareholders
(Thousands of euros)
2022
2021
Net contribution
Retail banking in Portugal
321,110
227,805
Companies, Corporate and Investment banking
101,195
98,090
Private Banking
21,268
15,133
Foreign business (continuing operations)
(224,425)
(218,883)
Non-controlling interests (1)
72,802
113,291
291,950
235,436
Income arising from discontinued or discontinuing operations
5,537
70,881
297,487
306,317
Amounts not allocated to segments
Net interest income of the bond portfolio
48,729
29,504
Net interest income - TLTRO
41,555
81,266
Foreign exchange activity
36,209
28,539
Gains / (losses) arising from sales of subsidiaries and other assets
6,660
2,164
Equity accounted earnings
67,797
58,317
Impairment and other provisions (2)
(176,188)
(215,421)
Operational costs (3)
(16,482)
(90,678)
Gains on sale of Portuguese public debt
(24,336)
39,430
Gains on sale of foreign public debt
15,700
19,786
Mandatory contributions
(88,528)
(77,222)
Loans sale
8,291
(3,407)
Income from other financial assets not held for trading mandatorily
at fair value through profit or loss (4)
3,474
(33,774)
Taxes (5)
(7,441)
46,040
Non-controlling interests
5,020
(201)
Others (6)
(10,450)
(52,578)
Total not allocated to segments
(89,990)
(168,235)
Consolidated net income
207,497
138,082
The presented amounts include the accumulated net income.
Risk Management
The Group is subject to several risks during the course of its business. The risks from different companies of the Group
are managed centrally, in coordination with the local departments and considering the specific risks of each business.
The Group's risk-management policy is designed to permanently ensure an adequate relationship between its own funds
and the business it develops, as well as the corresponding evaluation of the risk/return profile by business line. Under
this scope, the monitoring and control of the main types of financial risks (e.g. credit, market, operational) or non-
financial risks (e.g. legal and compliance, reputational) to which the Group's business is subject to.
The Bank implemented a regular process for identifying and assessing the risks to which its activity is exposed, which
conclusions are presented to the management bodies and influence the update of the Group\u2019s risk appetite and risk
strategy.
Internal organisation
Banco Comercial Portugu\u00eas Board of Directors is responsible for the definition of the risk strategy and policies,
including the approval of the principles and rules\u00a0 of the highest level to be followed in risk management, as well as the
guidelines dictating the allocation of capital to the business lines.
The Board of Directors, through the Audit Committee and Committee for Risk Assessment, ensures the existence of
adequate risk control and of risk-management systems at Group level and for each entity. The Board of Directors also
approves the risk-tolerance level acceptable to the Group, proposed by its Executive Committee.
The Risk Committee is responsible for monitoring the overall levels of risk incurred, ensuring that these are compatible
with the goals and strategies approved for the business. Other commissions regularly monitor specific risks, namely the
Compliance and Operational Risks Commission, the Credit and Non-performing Assets Monitoring Commission, the
Pension Funds Risk Monitoring Commission, the Operational Resilience Commission (with a focus on information
technologies and cybernetics), the Sustainability Commission and the Corporate Risk Monitoring Commission.
The Chief Risk Officer is responsible for the control of risks in all Group entities, for the identification of all risks to
which the Group activity is exposed and for the proposal of measures to improve risks control. The Chief Risk Officer
also ensures that risks are monitored on an overall basis and that there is alignment of concepts, practices and goals in
risk management. The activity of every entity included within the Banco Comercial Portugu\u00eas consolidation perimeter is
governed by the principles and decisions established centrally by the Board of Directors\u00a0 and the main subsidiaries are
provided with Risk Office structures which are established in accordance with the risks inherent to their particular
business. A Risk Control Commission has been set up at each relevant subsidiary, responsible for the control of risks at
local level, in which the Chief Risk Officer takes part.
The Group Head of Compliance is responsible for implementing systems for monitoring the compliance with legal
obligations and responsibilities to which the Bank is subject, as well, the prevention, monitoring and reporting of risks
in organizational processes, which include, among others, the prevention and repression of money laundering,
combating financing of terrorism, prevention of conflicts of interest, issues related to abuse of market and compliance
with the disclosure requirements to customers.
Risk assessment
Credit Risk
Credit granting is based on a prior classification of the customers\u2019 risk and on a thorough assessment of the level of
protection provided by the underlying collateral. In order to do so, a single risk-notation system has been introduced,
the Rating Master Scale, based on the expected probability of default, allowing greater discrimination in the
assessment of the customers and better establishment of the hierarchies of the associated risk.
The Rating Master Scale also identifies those customers that show a worsening credit capacity and, in particular, those
classified as being in default. All rating and scoring models used by the Group have been duly calibrated for the Rating
Master Scale. The protection-level concept has been introduced as a crucial element of evaluation of the effectiveness
of the collateral in credit-risk mitigation, leading to a more active collateralization of loans and to a better adequacy
of pricing regarding the risk incurred.
The gross Group\u2019s exposure to credit risk (original exposure) is presented in the following table:
(Thousands of euros)
Risk items
2022
2021
Central Governments or Central Banks
22,898,387
24,942,714
Regional Governments or Local Authorities
1,012,723
1,243,453
Administrative and non-profit Organisations
412,223
462,481
Multilateral Development Banks
114,633
18,790
Other Credit Institutions
3,279,977
2,777,375
Retail and Corporate customers
69,798,319
71,911,594
Other items (*)
10,153,154
8,562,386
107,669,416
109,918,793
Note: gross exposures of impairment and amortization, in accordance with the prudential consolidation perimeter. Includes
securitization positions.
(*) In addition to positions in equity, collective investment and securitization, the Other items contain other assets subject to credit
risk in accordance with Article 134 of the CRR.
The evaluation of the risk associated to the loan portfolio and quantification of the respective losses expected
considers the following methodological notes.
a) Collaterals and Guarantees
On the risk evaluation of an operation or of a group of operations, the mitigation elements of credit risk associated to
those operations are considered in accordance with the rules and internal procedures that fulfil the requirements
defined by the regulations in force, also reflecting the experience of the loan's recovery areas and the Legal
Department opinions with respect to the entailment of the various mitigation instruments.
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 7 or better on the Rating Master Scale;
- personal guarantees when the persons are classified with Risk Grade 7 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organized
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in restructuring
process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk Grade of
the client by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better than the client\u2019s),
when the protection is formalized through:
- State, Financial Institutions or Mutual Guarantee Societies guarantees exist;
- personal guarantees (or, in the case of Leasing,\u00a0 there is a recovery agreement of the provider);
- Credit derivatives;
- Formalization of the clause of the contracting party in leasing contracts in which it is an entity that is in a relationship
of dominion or group with the lessee.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis and
before decision process.
Either the initial evaluations or the subsequent reviews carried out are performed by external expert valuers and the
ratification process is centralized in the Appraisals Unit, which is independent of the clients\u2019 areas.
In any case, they are the subject to a written report, in a standardized digital format, based on a group of predefined
methods that are aligned with the sector practices \u2013 income, replacement cost and/or market comparative -
mentioning the obtained value, for both the market value and for purposes of the mortgage guarantee, depending on
the type of the real estate. The evaluations have a declaration/certification of an expert valuer since 2008, as
requested by Regulation (EU) 575/2013 and Law 153/2015 of 14 September and are ratified by the Appraisals Unit.
Regarding residential real estate, after the initial valuation and in accordance with Notice n. 5/2006 of Bank of
Portugal and e CRR 575/2013, the Bank monitors the respective values through market indexes. If the index is lower
than 0.9, the Bank\u00a0 revaluates choosing one of the following two methods:
i) - depreciation of the property by direct application of the index, if the amount owed does not exceed Euros 300,000;
ii) - review of the property value by external valuators, depending on the value of the credit operation, and in
accordance with the established standards from ECB and Bank of Portugal.
For all non-residential real estate, the Bank also monitors its values through market indexes and to the regular
valuation reviews with the minimum periodicities in accordance with the Regulation (EU) 575/2013, in the case of
offices, commercial spaces, warehouses and industrial premises.
For all real estate (residential or non-residential) for which the monitoring result in significant devaluation of the real
estate value (more than 10%), a valuation review is subsequently carried out by an expert valuer, preserving the
referred i) above.
For the remaining real estate (land or countryside buildings for example) there are no market indexes available for the
monitoring of appraisal values, after the initial valuations. Therefore, for these cases and in accordance with the
minimum periodicity established for the monitoring and reviewing of this type of real estate, valuation reviews are
carried out by expert valuers.
The indexes currently used are supplied to the Bank by an external specialized entity that, for more than a decade, has
been collecting and processing the data upon which the indexes are built.
In the case of financial collaterals, their market value is daily and automatically updated, through the IT connection
between the collaterals management system and the relevant financial markets data.
b) Risk grades
Credit granting is based on the previous risk assessment of clients and also on a rigorous assessment of the protection
level provided by the underlying collaterals. For this purpose, a single risk grading system is used - the Rating Master
Scale - based on Probability of Default (PD), allowing for a greater discriminating power in clients' assessment and for a
better hierarchy of the associated risk. The Rating Master Scale also allows to identify clients that show signs of
degradation in their credit capacity and, in particular, those that are classified in a default situation. All rating systems
and models used by the Group were calibrated for the Rating Master Scale.
Aiming at an adequate assessment of credit risk, the Group defined a set of macro segments and segments which are
treated through different rating systems and models that relate the internal risk grades and the clients\u2019 PD, ensuring a
risk assessment that considers the clients\u2019 specific features in terms of their respectively risk profiles.
The assessment made by these rating systems and models result in the risk grades of the Master Scale, that has fifteen
grades, where the last three correspond to relevant downgrades of the clients\u2019 credit quality and are referred to by
\u201cprocedural risk grades\u201d: 13, 14 and 15, that correspond, in this order, to situations of increased severity in terms
default, as risk grade 15 is a Default situation.
The non-procedural risk grades are attributed by the rating systems through automatic decision models or by the Rating
Division \u2013 a unit which is independent from the credit analysis and decision areas and bodies- and are reviewed/updated
periodically or whenever this is justified by events.
The models within the various rating systems are regularly subject to validation, made by the Models Validation and
Monitoring Office, which is independent from the units that are responsible for the development and maintenance of
the rating models.
The conclusions of the validations by the Models Validation and Monitoring Office, as well the respective
recommendations and proposal for changes and/or improvements, are analysed and ratified by a specific Validation
Committee, composed in accordance to the type of model analysed. The proposals for models\u2019 changes originated by
the Validation Committee are submitted to the approval of the Risk Committee.
The following table lists the equivalence between the internal rating levels (Rating Master Scale) and the external
ratings of the international rating agencies:
Internal risk grade
External ratings
Fitch
S&P
Moody's
DBRS
1
AAA
AAA
Aaa
AAA
1
AA+
AA+
Aa1
AA (high)
2
AA
AA
Aa2
AA
2
AA-
AA-
Aa3
AA (low)
3
A+
A+
A1
A (high)
3
A
A
A2
A
4
A-
A-
A3
A (low)
4
BBB+
BBB+
Baa1
BBB (high)
5
BBB
BBB
Baa2
BBB
6
BBB-
BBB-
Baa3
BBB (low)
7
BB+
BB+
Ba1
BB (high)
8
BB
BB
Ba2
BB
9
BB-
BB-
Ba3
BB (low)
10
B+
B+
B1
B (high)
11
B
B
B2
B
12
\u2264 B-
\u2264 B-
\u2264 B3
\u2264 B-
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
(Thousands of euros)
Category
2022
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
862
\u2014
\u2014
\u2014
862
Loans and advances to customers (note 22)
214,470
284,448
985,557
17,898
1,502,373
Debt instruments (note 23)
13,409
720
110
\u2014
14,239
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,067
\u2014
1,067
Guarantees and other commitments (note 39) (**)
11,307
14,893
84,435
119
110,754
Total
240,048
300,061
1,071,169
18,017
1,629,295
(Thousands of euros)
Category
2022
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
963,434
\u2014
\u2014
\u2014
963,434
Loans and advances to customers (note 22)
46,181,526
7,279,787
1,185,422
29,058
54,675,793
Debt instruments (note 23)
12,976,823
55,067
3,692
\u2014
13,035,582
Debt instruments at fair value through other
comprehensive income (note 24) (*)
7,434,152
\u2014
\u2014
\u2014
7,434,152
Guarantees and other commitments (note 45) (**)
14,291,924
1,753,702
280,256
802
16,326,684
Total
81,847,859
9,088,556
1,469,370
29,860
92,435,645
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
As at 31 December 2021, the financial instruments subject to impairment requirements under IFRS 9 (do not include
equity instruments as accounting policy 1.C1.1.2, analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2021
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,287
5,113
\u2014
\u2014
454,400
Loans and advances to customers (note 22)
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Debt instruments (note 23)
8,094,290
122,257
4,451
\u2014
8,220,998
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
1,092
\u2014
12,857,257
Guarantees and other commitments (note 45) (**)
13,462,773
1,922,031
412,179
\u2014
15,796,983
Total
80,976,168
10,013,453
3,103,989
57,713
94,151,323
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
(Thousands of euros)
Category
2021
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
128
1,059
\u2014
\u2014
1,187
Loans and advances to customers (note 22)
207,328
288,642
1,336,612
16,702
1,849,284
Debt instruments (note 23)
13,187
2,517
98
\u2014
15,802
Debt instruments at fair value through other
comprehensive income (note 23) (*)
\u2014
\u2014
1,092
\u2014
1,092
Guarantees and other commitments (note 39) (**)
12,848
13,033
84,768
\u2014
110,649
Total
233,491
305,251
1,422,570
16,702
1,978,014
(Thousands of euros)
Category
2021
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,159
4,054
\u2014
\u2014
453,213
Loans and advances to customers (note 22)
45,906,325
7,675,410
1,349,655
41,011
54,972,401
Debt instruments (note 23)
8,081,103
119,740
4,353
\u2014
8,205,196
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
\u2014
\u2014
12,856,165
Guarantees and other commitments (note 45) (**)
13,449,925
1,908,998
327,411
\u2014
15,686,334
Total
80,742,677
9,708,202
1,681,419
41,011
92,173,309
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as follows:
(Thousands of euros)
2022
2021
Financial assets held for trading (note 24)
Debt instruments
338,813
452,105
Derivatives
394,183
468,642
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
504,200
881,556
Hedging derivatives (note 25)
59,703
147,570
Total
1,296,899
1,949,873
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2022, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2022
Financial assets at amortised cost - Loans and advances to customers -
Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,111,726)
2,111,726
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(258,614)
\u2014
258,614
\u2014
\u2014
Transfers from stage 2 to stage 1
1,946,027
(1,946,027)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(631,859)
631,859
\u2014
\u2014
Transfers from stage 3 to stage 1
26,176
\u2014
(26,176)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
174,249
(174,249)
\u2014
\u2014
Write-offs
(922)
(2,996)
(440,667)
(13,820)
(458,405)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
681,402
(104,910)
(764,669)
3,063
(185,114)
Gross amount at the end of the year
46,395,996
7,564,235
2,170,979
46,956
56,178,166
During 2021, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2021
Financial assets at amortised cost - Loans and advances to customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Other (1)
Total
Gross amount as at 1 January
43,702,669
7,179,503
3,188,808
86,357
(98,458)
54,058,879
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,234,691)
2,234,691
\u2014
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(228,197)
\u2014
228,197
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 1
1,691,534
(1,691,534)
\u2014
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(339,863)
339,863
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 1
30,124
\u2014
(30,124)
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
121,048
(121,048)
\u2014
\u2014
\u2014
Write-offs
(3,261)
(2,370)
(362,075)
(5,004)
\u2014
(372,710)
Net balance of new financial assets and
derecognised financial assets and other
variations
3,509,575
462,577
(557,354)
(23,640)
98,458
3,489,616
Transfers resulting from changes in the
Group's structure (Banque Priv\u00e9e BCP
(Suisse))
(354,100)
\u2014
\u2014
\u2014
\u2014
(354,100)
Gross amount at the end of the year
46,113,653
7,964,052
2,686,267
57,713
\u2014
56,821,685
(Banque Priv\u00e9e BCP (Suisse))
(368)
\u2014
\u2014
\u2014
(368)
Impairment losses at the end of the year
207,328
288,642
1,336,612
16,702
1,849,284
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based on
expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2022
2021
Amortised cost before changes
396,049
612,501
Impairment losses before changes
(47,337)
(87,268)
Net amortised cost before changes
348,712
525,233
Net gain/loss arising on changes
(32,993)
(7,949)
Net amortised cost after changes
315,719
517,284
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,213,881
2,320,624
151,906
89,857
2,562,387
284,276
142,817
427,093
10,525
28,213,886
Individuals-Other
7,614,004
958,714
118,276
42,895
1,119,885
252,456
284,486
536,942
19,621
9,290,452
Financial Companies
3,569,566
80,945
61
\u2014
81,006
72,980
1,494
74,474
7,545
3,732,591
Non-financial companies - Corporate
9,621,830
700,538
660
13
701,211
204,523
91,575
296,098
\u2014
10,619,139
Non-financial companies - SME-
Corporate
10,238,522
2,798,567
5,339
2,559
2,806,465
761,101
95,135
856,236
6,733
13,907,956
Non-financial companies -SME-Retail
6,024,603
1,683,407
30,867
14,532
1,728,806
231,377
117,109
348,486
3,453
8,105,348
Non-financial companies -Other
558,812
46,613
2
\u2014
46,615
113
\u2014
113
\u2014
605,540
Other loans
11,812,537
342,203
39
\u2014
342,242
\u2014
30
30
\u2014
12,154,809
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Individuals-Mortgage
15,380
23,667
4,083
5,262
33,012
56,519
56,440
112,959
5,452
166,803
Individuals-Other
52,559
31,277
18,676
11,224
61,177
104,108
180,916
285,024
12,436
411,196
Financial Companies
8,491
1,701
4
\u2014
1,705
36,543
1,245
37,788
\u2014
47,984
Non-financial companies - Corporate
27,484
18,218
22
\u2014
18,240
87,043
43,500
130,543
\u2014
176,267
Non-financial companies - SME-
Corporate
46,296
81,667
506
660
82,833
298,455
46,890
345,345
129
474,603
Non-financial companies -SME-Retail
78,239
92,784
4,090
3,226
100,100
106,533
51,896
158,429
\u2014
336,768
Non-financial companies -Other
512
129
\u2014
\u2014
129
5
\u2014
5
\u2014
646
Other loans
11,087
2,860
5
\u2014
2,865
\u2014
9
9
\u2014
13,961
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Individuals-Mortgage
25,198,501
2,296,957
147,823
84,595
2,529,375
227,757
86,377
314,134
5,073
28,047,083
Individuals-Other
7,561,445
927,437
99,600
31,671
1,058,708
148,348
103,570
251,918
7,185
8,879,256
Financial Companies
3,561,075
79,244
57
\u2014
79,301
36,437
249
36,686
7,545
3,684,607
Non-financial companies - Corporate
9,594,346
682,320
638
13
682,971
117,480
48,075
165,555
\u2014
10,442,872
Non-financial companies - SME-
Corporate
10,192,226
2,716,900
4,833
1,899
2,723,632
462,646
48,245
510,891
6,604
13,433,353
Non-financial companies -SME-Retail
5,946,364
1,590,623
26,777
11,306
1,628,706
124,844
65,213
190,057
3,453
7,768,580
Non-financial companies -Other
558,300
46,484
2
\u2014
46,486
108
\u2014
108
\u2014
604,894
Other loans
11,801,450
339,343
34
\u2014
339,377
\u2014
21
21
\u2014
12,140,848
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Individuals-Mortgage
0.06%
1.02%
2.69%
5.86%
1.29%
19.88%
39.52%
26.45%
51.80%
0.59%
Individuals-Other
0.69%
3.26%
15.79%
26.17%
5.46%
41.24%
63.59%
53.08%
63.38%
4.43%
Financial Companies
0.24%
2.10%
6.56%
0.00%
2.10%
50.07%
83.33%
50.74%
0.00%
1.29%
Non-financial companies - Corporate
0.29%
2.60%
3.33%
0.00%
2.60%
42.56%
47.50%
44.09%
0.00%
1.66%
Non-financial companies - SME-
Corporate
0.45%
2.92%
9.48%
25.79%
2.95%
39.21%
49.29%
40.33%
1.92%
3.41%
Non-financial companies -SME-Retail
1.30%
5.51%
13.25%
22.20%
5.79%
46.04%
44.31%
45.46%
0.00%
4.15%
Non-financial companies -Other
0.09%
0.28%
0.00%
0.00%
0.28%
4.42%
0.00%
4.42%
0.00%
0.11%
Other loans
0.09%
0.84%
12.82%
0.00%
0.84%
0.00%
30.00%
30.00%
0.00%
0.11%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Segment
Stage 1
No delays
Days past
due <=
30 days
Days past
due > 30
days
Total
Days past
due <=
90 days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,365,328
2,305,851
126,323
66,432
2,498,606
296,980
171,593
468,573
13,320
28,345,827
Individuals-Other
7,631,117
820,962
94,862
40,061
955,885
251,607
340,511
592,118
42,163
9,221,283
Financial Companies
2,946,812
333,975
71
13
334,059
116,539
61,091
177,630
\u2014
3,458,501
Non-financial companies -
Corporate
7,994,250
920,647
436
409
921,492
209,359
365,953
575,312
\u2014
9,491,054
Non-financial companies - SME-
Corporate
9,848,761
2,914,636
8,506
2,360
2,925,502
719,045
142,057
861,102
850
13,636,215
Non-financial companies -SME-
Retail
6,469,104
2,021,279
18,127
12,285
2,051,691
329,395
98,615
428,010
1,380
8,950,185
Non-financial companies -Other
570,736
54,092
\u2014
\u2014
54,092
152
\u2014
152
\u2014
624,980
Other loans
7,293,895
272,126
\u2014
\u2014
272,126
\u2014
\u2014
\u2014
\u2014
7,566,021
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
\u2014
\u2014
Individuals-Mortgage
13,417
11,246
1,991
3,946
17,183
48,326
67,393
115,719
3,159
149,478
Individuals-Other
44,802
24,514
13,555
9,521
47,590
104,129
231,996
336,125
13,530
442,047
Financial Companies
4,990
6,966
4
3
6,973
67,871
42,746
110,617
\u2014
122,580
Non-financial companies -
Corporate
30,910
23,366
11
95
23,472
86,950
247,397
334,347
\u2014
388,729
Non-financial companies - SME-
Corporate
81,639
118,121
788
589
119,498
260,886
68,570
329,456
\u2014
530,593
Non-financial companies -SME-
Retail
47,538
82,720
2,356
2,543
87,619
143,756
51,382
195,138
13
330,308
Non-financial companies -Other
297
136
\u2014
\u2014
136
76
\u2014
76
\u2014
509
Other loans
9,898
2,780
\u2014
\u2014
2,780
\u2014
\u2014
\u2014
\u2014
12,678
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
\u2014
\u2014
Individuals-Mortgage
25,351,911
2,294,605
124,332
62,486
2,481,423
248,654
104,200
352,854
10,161
28,196,349
Individuals-Other
7,586,315
796,448
81,307
30,540
908,295
147,478
108,515
255,993
28,633
8,779,236
Financial Companies
2,941,822
327,009
67
10
327,086
48,668
18,345
67,013
\u2014
3,335,921
Non-financial companies -
Corporate
7,963,340
897,281
425
314
898,020
122,409
118,556
240,965
\u2014
9,102,325
Non-financial companies - SME-
Corporate
9,767,122
2,796,515
7,718
1,771
2,806,004
458,159
73,487
531,646
850
13,105,622
Non-financial companies -SME-
Retail
6,421,566
1,938,559
15,771
9,742
1,964,072
185,639
47,233
232,872
1,367
8,619,877
Non-financial companies -Other
570,439
53,956
\u2014
\u2014
53,956
76
\u2014
76
\u2014
624,471
Other loans
7,283,997
269,346
\u2014
\u2014
269,346
\u2014
\u2014
\u2014
\u2014
7,553,343
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Individuals-Mortgage
0.05%
0.49%
1.58%
5.94%
0.69%
16.27%
39.27%
24.70%
23.72%
0.53%
Individuals-Other
0.59%
2.99%
14.29%
23.77%
4.98%
41.39%
68.13%
56.77%
32.09%
4.79%
Financial Companies
0.17%
2.09%
5.63%
23.08%
2.09%
58.24%
69.97%
62.27%
0.00%
3.54%
Non-financial companies -
Corporate
0.39%
2.54%
2.52%
23.23%
2.55%
41.53%
67.60%
58.12%
0.00%
4.10%
Non-financial companies - SME-
Corporate
0.83%
4.05%
9.26%
24.96%
4.08%
36.28%
48.27%
38.26%
0.00%
3.89%
Non-financial companies -SME-
Retail
0.73%
4.09%
13.00%
20.70%
4.27%
43.64%
52.10%
45.59%
0.94%
3.69%
Non-financial companies -Other
0.05%
0.25%
0.00%
0.00%
0.25%
50.00%
0.00%
50.00%
0.00%
0.08%
Other loans
0.14%
1.02%
0.00%
0.00%
1.02%
0.00%
0.00%
0.00%
0.00%
0.17%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,827,885
3,279,338
270,182
132,752
3,682,272
536,732
427,303
964,035
30,146
37,504,338
Non-financial companies - Trade
5,312,463
827,990
9,921
4,283
842,194
91,204
45,688
136,892
4,715
6,296,264
Non-financial companies -
Construction
2,010,021
771,490
3,040
1,033
775,563
363,418
32,791
396,209
1,851
3,183,644
Non-financial companies -
Manufacturing industries
5,836,145
1,013,888
9,380
4,983
1,028,251
162,228
117,804
280,032
928
7,145,356
Non-financial companies -Other
activities
2,107,745
395,981
3,587
1,007
400,575
101,252
17,354
118,606
44
2,626,970
Non-financial companies - Other
services
11,177,393
2,219,776
10,940
5,798
2,236,514
479,012
90,182
569,194
2,648
13,985,749
Other Services /Other activities
15,382,103
423,148
100
\u2014
423,248
72,980
1,524
74,504
7,545
15,887,400
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
\u2014
\u2014
\u2014
Loans to individuals
67,939
54,944
22,759
16,486
94,189
160,627
237,356
397,983
17,888
577,999
Non-financial companies - Trade
22,306
26,555
1,168
1,110
28,833
35,530
20,294
55,824
129
107,092
Non-financial companies -
Construction
11,517
16,055
551
288
16,894
154,391
18,769
173,160
\u2014
201,571
Non-financial companies -
Manufacturing industries
54,925
54,821
1,293
1,258
57,372
65,474
58,761
124,235
\u2014
236,532
Non-financial companies -Other
activities
7,701
15,667
529
154
16,350
44,356
8,459
52,815
\u2014
76,866
Non-financial companies - Other
services
56,082
79,700
1,077
1,076
81,853
192,285
36,003
228,288
\u2014
366,223
Other Services /Other activities
19,578
4,561
9
\u2014
4,570
36,543
1,254
37,797
\u2014
61,945
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Loans to individuals
32,759,946
3,224,394
247,423
116,266
3,588,083
376,105
189,947
566,052
12,258
36,926,339
Non-financial companies - Trade
5,290,157
801,435
8,753
3,173
813,361
55,674
25,394
81,068
4,586
6,189,172
Non-financial companies -
Construction
1,998,504
755,435
2,489
745
758,669
209,027
14,022
223,049
1,851
2,982,073
Non-financial companies -
Manufacturing industries
5,781,220
959,067
8,087
3,725
970,879
96,754
59,043
155,797
928
6,908,824
Non-financial companies -Other
activities
2,100,044
380,314
3,058
853
384,225
56,896
8,895
65,791
44
2,550,104
Non-financial companies - Other
services
11,121,311
2,140,076
9,863
4,722
2,154,661
286,727
54,179
340,906
2,648
13,619,526
Other Services /Other activities
15,362,525
418,587
91
\u2014
418,678
36,437
270
36,707
7,545
15,825,455
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Loans to individuals
0.21%
1.68%
8.42%
12.42%
2.56%
29.93%
55.55%
41.28%
59.34%
1.54%
Non-financial companies - Trade
0.42%
3.21%
11.77%
25.92%
3.42%
38.96%
44.42%
40.78%
2.74%
1.70%
Non-financial companies -
Construction
0.57%
2.08%
18.13%
27.88%
2.18%
42.48%
57.24%
43.70%
0.00%
6.33%
Non-financial companies -
Manufacturing industries
0.94%
5.41%
13.78%
25.25%
5.58%
40.36%
49.88%
44.36%
0.00%
3.31%
Non-financial companies -Other
activities
0.37%
3.96%
14.75%
15.29%
4.08%
43.81%
48.74%
44.53%
0.00%
2.93%
Non-financial companies - Other
services
0.50%
3.59%
9.84%
18.56%
3.66%
40.14%
39.92%
40.11%
0.00%
2.62%
Other Services /Other activities
0.13%
1.08%
9.00%
0.00%
1.08%
50.07%
82.28%
50.73%
0.00%
0.39%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Sector of activity
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,996,445
3,126,813
221,185
106,493
3,454,491
548,587
512,104
1,060,691
55,483
37,567,110
Non-financial companies -
Trade
5,498,200
868,334
4,967
3,001
876,302
91,994
57,333
149,327
99
6,523,928
Non-financial companies -
Construction
1,862,344
860,822
3,450
1,790
866,062
375,867
35,275
411,142
41
3,139,589
Non-financial companies -
Manufacturing industries
5,586,843
998,335
8,412
2,987
1,009,734
171,010
119,504
290,514
92
6,887,183
Non-financial companies -
Other activities
1,665,202
452,573
618
581
453,772
174,343
85,674
260,017
19
2,379,010
Non-financial companies -
Other services
10,270,262
2,730,590
9,622
6,695
2,746,907
444,737
308,839
753,576
1,979
13,772,724
Other Services /Other
activities
10,240,707
606,101
71
13
606,185
116,539
61,091
177,630
\u2014
11,024,522
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
Loans to individuals
58,219
35,760
15,546
13,467
64,773
152,455
299,389
451,844
16,689
591,525
Non-financial companies -
Trade
29,433
28,996
529
534
30,059
33,035
37,220
70,255
\u2014
129,747
Non-financial companies -
Construction
11,855
14,740
634
389
15,763
127,891
22,655
150,546
\u2014
178,164
Non-financial companies -
Manufacturing industries
33,038
30,564
473
725
31,762
49,030
53,649
102,679
12
167,491
Non-financial companies -
Other activities
9,548
17,393
123
120
17,636
87,138
41,142
128,280
\u2014
155,464
Non-financial companies -
Other services
76,510
132,650
1,396
1,459
135,505
194,574
212,683
407,257
1
619,273
Other Services /Other
activities
14,888
9,746
4
3
9,753
67,871
42,746
110,617
\u2014
135,258
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
Loans to individuals
32,938,226
3,091,053
205,639
93,026
3,389,718
396,132
212,715
608,847
38,794
36,975,585
Non-financial companies -
Trade
5,468,767
839,338
4,438
2,467
846,243
58,959
20,113
79,072
99
6,394,181
Non-financial companies -
Construction
1,850,489
846,082
2,816
1,401
850,299
247,976
12,620
260,596
41
2,961,425
Non-financial companies -
Manufacturing industries
5,553,805
967,771
7,939
2,262
977,972
121,980
65,855
187,835
80
6,719,692
Non-financial companies -
Other activities
1,655,654
435,180
495
461
436,136
87,205
44,532
131,737
19
2,223,546
Non-financial companies -
Other services
10,193,752
2,597,940
8,226
5,236
2,611,402
250,163
96,156
346,319
1,978
13,153,451
Other Services /Other
activities
10,225,819
596,355
67
10
596,432
48,668
18,345
67,013
\u2014
10,889,264
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Loans to individuals
0.18%
1.14%
7.03%
12.65%
1.88%
27.79%
58.46%
42.60%
30.08%
1.57%
Non-financial companies -
Trade
0.54%
3.34%
10.65%
17.79%
3.43%
35.91%
64.92%
47.05%
0.00%
1.99%
Non-financial companies -
Construction
0.64%
1.71%
18.38%
21.73%
1.82%
34.03%
64.22%
36.62%
0.00%
5.67%
Non-financial companies -
Manufacturing industries
0.59%
3.06%
5.62%
24.27%
3.15%
28.67%
44.89%
35.34%
13.04%
2.43%
Non-financial companies -
Other activities
0.57%
3.84%
19.90%
20.65%
3.89%
49.98%
48.02%
49.34%
0.00%
6.53%
Non-financial companies -
Other services
0.74%
4.86%
14.51%
21.79%
4.93%
43.75%
68.87%
54.04%
0.05%
4.50%
Other Services /Other
activities
0.15%
1.61%
5.63%
23.08%
1.61%
58.24%
69.97%
62.27%
0.00%
1.23%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
54,604,642
7,155,127
159,209
66,646
7,380,982
1,410,285
306,213
1,716,498
19,011
63,721,133
Poland
18,184,099
1,377,667
142,519
81,498
1,601,684
386,990
343,753
730,743
28,866
20,545,392
Mozambique
1,865,014
398,817
5,422
1,712
405,951
9,551
82,680
92,231
\u2014
2,363,196
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Portugal
150,039
205,954
7,124
5,447
218,525
550,372
124,012
674,384
\u2014
1,042,948
Poland
83,818
42,151
19,641
14,566
76,358
136,847
210,573
347,420
18,017
525,613
Mozambique
6,191
4,198
621
359
5,178
1,987
46,311
48,298
\u2014
59,667
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Portugal
54,454,603
6,949,173
152,085
61,199
7,162,457
859,913
182,201
1,042,114
19,011
62,678,185
Poland
18,100,281
1,335,516
122,878
66,932
1,525,326
250,143
133,180
383,323
10,849
20,019,779
Mozambique
1,858,823
394,619
4,801
1,353
400,773
7,564
36,369
43,933
\u2014
2,303,529
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment
coverage
Portugal
0.27%
2.88%
4.47%
8.17%
2.96%
39.03%
40.50%
39.29%
0.00%
1.64%
Poland
0.46%
3.06%
13.78%
17.87%
4.77%
35.36%
61.26%
47.54%
62.42%
2.56%
Mozambique
0.33%
1.05%
11.45%
20.97%
1.28%
20.80%
56.01%
52.37%
0.00%
2.52%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in the
accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit lines and revocable commitments (note 45).
As at 31 December 2021, the gross exposure, by type of financial instrument, internal rating and stage, is analysed as
follows:
(Thousands of euros)
2021
Gross Exposure
Higher quality
(GR 1-6)
Average
quality
(GR 7-9)
Lower
quality
(GR 10-12)
Procedural
(GR 13/14/15)
Not classified
(without risk
grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
39,440,489
10,218,369
3,686,807
6,197
1,305,368
54,657,230
220,643
54,436,587
stage 2
1,650,754
1,832,802
3,828,897
284,265
494,703
8,091,421
292,219
7,799,202
stage 3
\u2014
\u2014
\u2014
2,690,023
695
2,690,718
1,336,710
1,354,008
POCI
3,001
2,535
1,096
51,081
1
57,714
16,702
41,012
41,094,244
12,053,706
7,516,800
3,031,566
1,800,767
65,497,083
1,866,274
63,630,809
Debt instruments at fair
value through other
comprehensive income (*)
stage 1
12,357,161
249,054
29,162
\u2014
220,790
12,856,167
\u2014
12,856,167
stage 3
\u2014
\u2014
\u2014
\u2014
1,092
1,092
1,092
\u2014
12,357,161
249,054
29,162
\u2014
221,882
12,857,259
1,092
12,856,167
Guarantees and other
commitments (**)
stage 1
8,383,240
3,632,450
1,183,525
192
263,366
13,462,773
12,848
13,449,925
stage 2
197,624
509,335
919,049
42,849
253,175
1,922,032
13,032
1,909,000
stage 3
\u2014
\u2014
\u2014
412,179
\u2014
412,179
84,768
327,411
8,580,864
4,141,785
2,102,574
455,220
516,541
15,796,984
110,648
15,686,336
Total
62,032,269
16,444,545
9,648,536
3,486,786
2,539,190
94,151,326
1,978,014
92,173,312
As at 31 December 2021, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by segment, are presented in the following
table
(Thousands of euros)
2021
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgage
46,604
28,299,223
28,345,827
14,081
135,397
149,478
Individuals - Other
30,802
9,190,481
9,221,283
18,753
423,294
442,047
Financial Companies
171,875
3,286,626
3,458,501
110,524
12,056
122,580
Non-financial companies - Corporate
520,987
8,970,067
9,491,054
325,523
63,206
388,729
Non-financial companies - SME - Corporate
650,958
12,985,257
13,636,215
290,432
240,161
530,593
Non-financial companies -SME - Retail
248,059
8,702,126
8,950,185
127,132
203,176
330,308
Non-financial companies - Other
152
624,828
624,980
76
433
509
Other loans
\u2014
7,566,021
7,566,021
\u2014
12,678
12,678
Total
1,669,437
79,624,629
81,294,066
886,521
1,090,401
1,976,922
As at 31 December 2022, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by sector of activity are presented in the
following table:
(Thousands of euros)
2022
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
57,653
37,446,685
37,504,338
27,929
550,070
577,999
Non-financial companies - Trade
56,649
6,239,615
6,296,264
30,640
76,452
107,092
Non-financial companies - Construction
308,289
2,875,355
3,183,644
158,454
43,117
201,571
Non-financial companies - Manufacturing
industry
173,248
6,972,108
7,145,356
93,885
142,647
236,532
Non-financial companies - Other activities
95,832
2,531,138
2,626,970
44,541
32,325
76,866
Non-financial companies - Other services
454,653
13,531,096
13,985,749
195,688
170,535
366,223
Other Services /Other activities
81,059
15,806,341
15,887,400
37,622
24,323
61,945
Total
1,227,383
85,402,338
86,629,721
588,759
1,039,469
1,628,228
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to individual
analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31 December 2022, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet - it\u00a0 does not include restructured loans):
2022
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2012 and previous
Number of operations
15,703
25,791
293,344
677,001
384
1,012,223
Value (Euros '000)
970,246
3,194,423
10,117,624
1,228,014
81,780
15,592,087
Impairment constituted (Euros '000)
73,617
51,428
106,931
17,378
646
250,000
2013
Number of operations
1,121
3,600
10,115
65,523
17
80,376
Value (Euros '000)
64,192
510,025
376,049
106,759
2,537
1,059,562
Impairment constituted (Euros '000)
3,236
3,441
5,681
3,329
6
15,693
2014
Number of operations
1,234
4,859
8,737
82,035
86
96,951
Value (Euros '000)
76,217
509,250
356,743
126,516
183,780
1,252,506
Impairment constituted (Euros '000)
5,049
9,235
4,719
4,618
855
24,476
2015
Number of operations
1,691
6,284
10,836
112,676
124
131,611
Value (Euros '000)
106,007
908,354
515,361
185,482
44,947
1,760,151
Impairment constituted (Euros '000)
1,947
23,398
3,874
9,116
27,758
66,093
2016
Number of operations
1,911
8,196
12,280
134,403
55
156,845
Value (Euros '000)
154,183
1,209,277
616,181
256,858
4,248
2,240,747
Impairment constituted (Euros '000)
5,274
13,961
4,432
17,195
174
41,036
2017
Number of operations
2,568
11,100
20,277
142,014
96
176,055
Value (Euros '000)
219,318
1,228,140
1,202,742
305,913
13,230
2,969,343
Impairment constituted (Euros '000)
2,807
17,900
5,830
21,347
720
48,604
2018
Number of operations
5,312
19,488
26,701
286,638
203
338,342
Value (Euros '000)
498,338
2,227,925
1,833,809
655,719
309,885
5,525,676
Impairment constituted (Euros '000)
7,262
32,931
6,511
43,836
1,607
92,147
2019
Number of operations
8,703
27,962
30,166
595,430
185
662,446
Value (Euros '000)
632,970
2,098,246
2,198,981
1,221,662
144,135
6,295,994
Impairment constituted (Euros '000)
7,295
45,754
5,735
75,179
3,002
136,965
2020
Number of operations
9,891
37,416
36,088
313,758
255
397,408
Value (Euros '000)
1,148,968
4,324,442
2,656,294
809,745
165,228
9,104,677
Impairment constituted (Euros '000)
13,228
83,686
7,361
42,424
1,638
148,337
2021
Number of operations
10,744
37,545
53,486
524,347
340
626,462
Value (Euros '000)
1,146,704
3,355,457
4,464,436
1,376,201
388,696
10,731,494
Impairment constituted (Euros '000)
15,760
51,953
8,848
61,243
2,299
140,103
2022
Number of operations
14,046
117,544
38,354
1,108,878
4,678
1,283,500
Value (Euros '000)
2,097,778
7,566,584
3,822,846
2,514,949
364,556
16,366,713
Impairment constituted (Euros '000)
19,365
169,939
5,788
64,160
2,593
261,845
Total
Number of operations
72,924
299,785
540,384
4,042,703
6,423
4,962,219
Value (Euros '000)
7,114,921
27,132,123
28,161,066
8,787,818
1,703,022
72,898,950
Impairment constituted (Euros '000)
154,840
503,626
165,710
359,825
41,298
1,225,299
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2021, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet\u00a0 - it does not include restructured loans):
2021
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2011 and previous
Number of operations
16,443
27,013
312,064
707,279
493
1,063,292
Value (Euros '000)
988,051
3,546,686
11,518,139
1,202,309
96,963
17,352,148
Impairment constituted (Euros '000)
74,609
59,229
112,005
25,236
824
271,903
2012
Number of operations
1,184
3,463
11,387
103,094
184
119,312
Value (Euros '000)
80,315
213,802
401,586
144,851
10,158
850,712
Impairment constituted (Euros '000)
3,837
5,324
4,751
4,355
35
18,302
2013
Number of operations
1,641
4,653
11,229
107,983
33
125,539
Value (Euros '000)
81,722
576,793
442,501
136,479
8,762
1,246,257
Impairment constituted (Euros '000)
4,471
8,084
5,580
5,122
5,108
28,365
2014
Number of operations
1,641
6,271
9,805
116,968
95
134,780
Value (Euros '000)
105,894
645,718
422,736
166,061
190,746
1,531,155
Impairment constituted (Euros '000)
3,970
20,745
4,348
7,486
2,191
38,740
2015
Number of operations
2,289
8,314
12,051
161,566
135
184,355
Value (Euros '000)
118,689
964,423
598,334
241,761
42,217
1,965,424
Impairment constituted (Euros '000)
2,824
28,579
3,728
16,198
19,417
70,746
2016
Number of operations
2,669
11,649
13,803
182,204
76
210,401
Value (Euros '000)
163,829
1,478,862
722,220
354,356
4,193
2,723,460
Impairment constituted (Euros '000)
6,010
38,956
3,929
28,921
200
78,016
2017
Number of operations
3,601
16,424
22,504
206,982
135
249,646
Value (Euros '000)
277,439
1,670,775
1,398,081
429,457
18,044
3,793,796
Impairment constituted (Euros '000)
5,095
23,129
4,472
35,979
680
69,355
2018
Number of operations
6,750
28,128
29,336
361,525
252
425,991
Value (Euros '000)
765,450
2,700,168
2,109,180
893,124
334,778
6,802,700
Impairment constituted (Euros '000)
10,003
53,212
4,375
66,397
1,688
135,675
2019
Number of operations
10,349
35,279
33,145
703,461
255
782,489
Value (Euros '000)
916,637
2,723,462
2,540,307
1,582,002
181,729
7,944,137
Impairment constituted (Euros '000)
9,757
69,372
2,964
95,816
2,883
180,792
2020
Number of operations
11,226
42,426
39,282
450,557
362
543,853
Value (Euros '000)
1,671,233
5,360,650
3,082,954
1,138,368
268,429
11,521,634
Impairment constituted (Euros '000)
19,037
87,662
4,534
44,968
2,008
158,209
2021
Number of operations
14,097
107,313
56,969
994,034
5,019
1,177,432
Value (Euros '000)
1,729,149
6,506,623
5,006,493
2,353,761
513,072
16,109,098
Impairment constituted (Euros '000)
17,888
88,776
7,652
35,963
2,954
153,233
Total
Number of operations
71,890
290,933
551,575
4,095,653
7,039
5,017,090
Value (Euros '000)
6,898,408
26,387,962
28,242,531
8,642,529
1,669,091
71,840,521
Impairment constituted (Euros '000)
157,501
483,068
158,338
366,441
37,988
1,203,336
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2022, the following table includes the fair value of the collaterals by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2022
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,822
9,575
9,030
71,315
468,372
303
Value (Euros '000)
882,242
223,661
1,369,613
1,489,242
62,924,078
17,038
>= 0.5 M\u20ac and < 1 M\u20ac
Number
741
70
1,189
236
6,321
4
Value (Euros '000)
520,105
47,186
832,819
162,741
4,080,818
2,230
>= 1 M\u20ac and < 5 M\u20ac
Number
634
47
1,110
205
1,062
1
Value (Euros '000)
1,307,513
84,190
2,223,387
395,940
1,636,182
1,267
>= 5 M\u20ac and < 10 M\u20ac
Number
108
2
118
15
14
\u2014
Value (Euros '000)
737,705
10,838
852,256
102,251
86,476
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
50
2
57
13
1
\u2014
Value (Euros '000)
651,146
21,833
809,825
194,916
11,110
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
22
\u2014
40
1
\u2014
\u2014
Value (Euros '000)
636,352
\u2014
1,208,432
20,452
\u2014
\u2014
>= 50 M\u20ac
Number
6
\u2014
14
2
\u2014
\u2014
Value (Euros '000)
455,600
\u2014
1,245,381
523,630
\u2014
\u2014
Total Number
8,383
9,696
11,558
71,787
475,770
308
Total\u00a0 Value (Euros '000)
5,190,663
387,708
8,541,713
2,889,172
68,738,664
20,535
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2021, the following table includes the fair value of the collaterals\u00a0 by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2021
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,479
10,273
9,346
74,677
476,204
321
Value (Euros '000)
868,524
238,345
1,412,766
1,495,825
60,342,081
17,349
>= 0.5 M\u20ac and < 1 M\u20ac
Number
763
63
1,231
249
5,567
6
Value (Euros '000)
522,827
40,591
858,038
170,352
3,594,194
3,534
>= 1 M\u20ac and < 5 M\u20ac
Number
550
57
1,092
207
883
1
Value (Euros '000)
1,125,581
105,005
2,173,966
388,273
1,337,278
1,474
>= 5 M\u20ac and < 10 M\u20ac
Number
100
3
119
20
10
\u2014
Value (Euros '000)
696,758
16,515
844,212
134,534
63,256
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
44
3
51
15
1
\u2014
Value (Euros '000)
595,828
40,128
687,338
224,766
11,047
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
33
\u2014
35
1
\u2014
\u2014
Value (Euros '000)
958,264
\u2014
1,032,578
49,281
\u2014
\u2014
>= 50 M\u20ac
Number
4
\u2014
13
3
\u2014
\u2014
Value (Euros '000)
260,929
\u2014
1,108,030
827,069
\u2014
\u2014
Total Number
7,973
10,399
11,887
75,172
482,665
328
Total\u00a0 Value (Euros '000)
5,028,711
440,584
8,116,928
3,290,100
65,347,856
22,357
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2022, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgage loans:
(Thousands of euros)
2022
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,528,695
453,957
73,399
70,799
<60%
25,799
1,019,694
259,169
42,667
31,589
>=60% and <80%
2,771
376,094
81,106
21,337
9,536
>=80% and <100%
1,067
131,874
46,414
58,121
49,541
>=100%
979
74,888
73,472
61,705
40,249
Companies - Other Activities
Without associated collateral
n.a.
10,285,172
1,651,463
284,131
393,519
<60%
49,259
1,563,296
495,030
141,344
65,781
>=60% and <80%
16,491
991,449
329,502
128,863
48,995
>=80% and <100%
11,106
576,326
406,133
72,826
47,386
>=100%
2,741
654,901
202,769
280,711
146,244
Mortgage loans
Without associated collateral
n.a.
53,715
2,892
10,403
10,816
<60%
383,344
13,363,029
1,310,064
261,616
102,636
>=60% and <80%
129,126
8,530,613
844,549
112,000
32,431
>=80% and <100%
39,677
2,884,194
357,767
58,421
19,953
>=100%
6,013
235,017
60,244
30,008
15,674
Credit portfolio monitoring process
The Bank adjusted its credit portfolio management and monitoring processes, namely with regard to the assessment of
the potential impacts of the macroeconomic context on the risk profile of the different portfolios/segments of
exposure, an approach that was consolidated in 2022.
This modification, that began in 2020, was based on the creation of a specific approach with the objective of
identifying and closely monitoring the customers potentially more affected by the macroeconomic context, anticipating
possible difficulties in complying their responsibilities and defining credit and performance strategies adjusted to the
specific specificities of each customer/group of customers, with a view to both maintaining support to customers
considered viable and mitigating credit risk.
The importance of this new approach is reinforced by the uncertainty that impacted the activity in recent times. In
fact, while it is true that the effects of the pandemic have faded, new risks have emerged in the meantime, especially
those resulting from the geopolitical conflict between Russia and Ukraine, reinforcing threats that were already
appearing in areas such as constraints in logistics and distribution chains, limitations in access to raw materials and
certain goods, increased energy costs, inflationary pressures and rising interest rates.
The main guidelines of the credit portfolio monitoring approach can be characterized as presented below:
- Global and transversal: Is supported by an analysis of the entire credit portfolio of the Bank, being excluded from the
special monitoring only customers with a better risk profile (in the case of retail) or with exposures of a lower size (in
the case of retail and corporate).
- Specialized: Monitoring by the \u201cComit\u00e9 de Acompanhamento de Risco de Empresas\u201d (CARE), and Credit Division in
coordination with the Rating Division for the corporate segment and by the Retail Recovery Division for individuals and
small businesses. The cases monitored by the CARE Committee, which is conducted at least monthly, are related to
clients covered by a set of criteria that combine exposure size and risk factors like the rating assigned, IFRS 9 staging
and, for the corporate segment, the level of leverage and whether the sector in which it operates is considered highly
vulnerable.
- Segmented: Prioritization of approach/analysis recurrence based on risk signs, in order to gather additional
information and agree on appropriate and sustainable financial restructuring solutions in a timely manner.
- Prospective: Definition of predictive models, in order to anticipate potential future defaults, avoiding a reactive
approach.
- Standardized: Both in terms of risk models and monitoring, and in terms of credit solutions for which it is possible to
identify pre-defined alternatives (retail segments).
- Convenient and innovative: Making the restructuring journey simpler and more convenient both in terms of credit
solutions and channels, extending the restructuring offer to the App for consumer credit and mortgages.
Specifically in the corporate segment, the process of portfolio follow-up and monitoring can be generically
characterized as described below, having as a fundamental component the attribution of credit strategies, among pre-
defined options, with review periods differentiated according to the level of risk associated to the strategy attributed:
1. Client Assessment and presentation of Indicative Credit Strategy by the Rating Division (for customers with ratings
assigned by corporate rating models);
2. Approval, by the competent credit decision levels, of a credit strategy for each customer, taking into consideration
the Indicative Credit Strategy received from the Rating Division, the proposals received from the area that follows the
client and the inputs received as a result of the customer interaction process;
3. Decision, negotiation and formalisation of the operations that will ensure that the approved strategy is pursued and
the approved credit limits are met (Credit Division, Areas that follow the client and Operations Division);
4. Monitoring the Credit Strategy and the evolution of the customer's activity (Credit Division, Areas that follow the
client and Specialised Committees - CARE);
5. Monitoring of the credit portfolio and effectiveness of the portfolio monitoring process and credit strategy
attribution (Risk Office), based on a set of KPIs, (e.g. percentage of the credit portfolio with valid risk strategy;
evolution of credit exposure to customers with a reduction strategy; adequacy of the credit strategy to the customer's
performance);
6. In the attribution of the customer's credit strategy, besides the intrinsic factors of the customer, more transversal
factors are taken into consideration, such as the evaluation of the sectorial risk and ESG impacts (periodically reviewed
with the support of the Economic, Sustainability and Criptoactives Studies Division)
7. The occurrence of effective and/or potential risk events (signs of default/delinquency; breach of contractual
covenants; severe alteration in sector risk; alteration in the corporate/shareholder structure), trigger an extraordinary
revision of the strategy.
Within the scope of this monitoring process and with an impact on other and differentiated procedures adopted by the
Bank, namely for reporting purposes, the Bank defines a list of sectors considered as more vulnerable to the
macroeconomic environment, which is reviewed periodically (at least annually).
At least once a year the Bank produces a report presenting a detailed characterisation of its loan portfolio under a
sectoral perspective.
Additional measures with impact on the Impairment level
i. Updating macroeconomic scenarios and the parameters of the collective impairment model
Taking into account the changes and uncertainty of the context and the economic perspectives essentially marked by a
transition from a pandemic context to one conditioned by expressive rises in the inflation and interest rate levels, as
well as by crisis in various supply chains, it was decided to update the regressions and macroeconomic scenarios
considered in the collective analysis model in Portugal, namely with the aim to capture the effect of variables such as
inflation and interest rates.
Specifically, in what regards the macroeconomic scenarios, at the end of December the macroeconomic assumptions
used in the impairment calculation were updated, based on three scenarios (Central Scenario, Upside and Downside)
prepared by the Bank's Economic Studies Department.
The referred scenarios, which are used in the Bank for several purposes other than the impairment calculation, took
into consideration the existing projections of reputed entities.
The tables below systematise the assumptions considered for Portugal for the central scenarios with regard to some of
the most critical variables used in the calculation of collective impairment with reference to 31 December 2022.
Update of main macroeconomic scenario assumptions (Base Scenario) - Portugal
December 2022 Scenario
Variable
2022
2023
Unemployment rate
5.86%
5.88%
3 months Euribor Rate
0.65%
3.34%
Savings Rate
4.4%
5.8%
Inflation Rate
8.06%
5.83%
ii. Impairment overlays
In order to incorporate an additional level of conservatism in the impairment values, the Bank defined and
implemented a methodology of complementary identification of situations of significant increase in credit risk and signs
of impairment. This approach adopts complementary and distinct criteria in relation to the methodologies in force,
with distinct processes having been adopted for the calculation of overlays for the corporate and individual customers
segments.
In fact, the impacts related to the COVID-19 pandemic have been losing expression, namely as a result of the time
elapsed since the end of the large majority of the moratoria (September 2021) and given that some of the most
affected sectors have already overcome the challenges posed by this crisis.\u00a0 However, there is a level of uncertainty
associated with the current geopolitical crisis, disruption in distribution chains, rising energy costs and inflationary
pressures.
Under this framework, in Portugal, the Bank has changed its methodology for the overlays calculation, adopting an
approach which reflects the context described above, which implied a disruption to the framework which prevailed up
to the end of 2021, characterized by low levels of interest rates and inflation.
This positioning is in line with the guidelines on this matter issued by the Supervisors in what regards the identification
and measurement of credit risk in contexts of uncertainty, so that the release of overlays constituted in the context of
the pandemic should be carried out with prudence and taking into account the possible need for new overlays to
respond to the current context.
The exercise carried out reflected, in terms of impairment value, in the calculation of the estimated impact arising
from potential migrations of customers with higher risk to Stage 2 and Stage 3, based on the various factors considered
in the analysis. It should be noted that the most significant impact occurred in the corporate segment. The
methodology developed by the Bank was considered for the calculation and recording of impairment at the reference
date of the accounts, without affecting the classification of credit exposures by stages in the Bank's loan portfolio.
In Poland, the Bank also adopted a policy of recording overlays. Taking into consideration the country's specific reality,
adjustments to the overlays methodology had already been incorporated in the first half of the year to address the
impacts of the geopolitical crisis.
As a result of the implementation of this methodology, the Bank calculated an additional impairment to that resulting
from the collective analysis model, therefore with characteristics of overlays, whose amount on 31 December 2022 was
approximately Euros 95.0 million in Portugal (Euros 71.1 million in June 2022) and Euros 33.9 million in Poland (Euros
23.4 million in June 2022).
ii. Risk Grade freeze of clients rated by behavioural models\u00a0
Assuming a conservative perspective, in Portugal, the Bank implemented a procedure whereby it identified the
customers subject to moratorium with internal risk rating awarded by behavioural models that at the end of December
showed an improvement in the risk level in comparison with the one existing before the moratoria and, for these cases,
assumed for purposes of staging criteria and impairment calculation the maintenance of that pre-moratoria risk rating.
This procedure did not imply a change in the internal risk rating attributed by the Bank.
From March 2022 onwards the above-mentioned procedure was no longer applied, given that the vast majority of
moratoria had ended in September 2021 and the remaining in the end of December 2021. As such, the Bank considered
that an elapsed period is more than enough to consider that the behavioural rating models are no longer affected by
the previous existence of moratoria.
Operations subject to legislative and non-legislative moratorium and new loans granted under
new public guaranteed systems introduced in response to the COVID-19 crisis
The following tables characterize the transactions that, as of 31 December 2022 and 31 December 2021, were subject
to legislative and non-legislative moratorium, as well as new loans granted under new public guaranteed systems
introduced in response to the COVID-19 crisis, at consolidated level.
As of 31 December 2022 and 31 December 2021, the amounts related with the moratoria in force are null.
Loans and advances subject to legislative and non-legislative moratorium
The analysis of the gross carrying amount and respective impairment, of loans and advances that have ever been
subject to legislative and non-legislative moratorium, with reference as at 31 December 2022:
(Thousands of euros)
Gross carrying amount
Performing\u00a0
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Inflows to
non-
performing
exposures
in the last
12 months
Loans and advances
subject to
moratorium
8,626,118
7,753,682
360,015
2,181,916
872,436
584,806
740,621
373,358
of which: Households
4,417,087
4,177,902
234,854
857,087
239,185
143,336
159,863
112,404
of which:
Collateralised by
residential
immovable property
3,875,782
3,733,170
202,408
748,053
142,612
89,873
111,963
72,969
of which: Non-
financial corporations
4,141,382
3,526,701
122,418
1,313,634
614,681
422,915
562,204
260,941
of which: Small and
Medium-sized
Enterprises
3,789,598
3,235,758
121,308
1,231,214
553,840
388,948
504,124
236,774
of which:
Collateralised by
commercial
immovable property
1,577,218
1,138,663
65,753
565,159
438,555
332,263
422,964
205,280
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(Thousands of euros)
Accumulated impairment (**)
Performing
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Loans and advances subject
to moratorium
468,971
98,882
8,658
79,585
370,089
282,736
314,400
of which: Households
86,079
21,528
2,729
16,837
64,551
35,542
31,950
of which: Collateralised
by residential immovable
property
30,227
9,901
1,004
8,193
20,326
13,993
15,261
of which: Non-financial
corporations
363,087
76,077
5,379
61,625
287,010
228,671
263,927
of which: Small and
Medium-sized Enterprises
325,495
72,282
5,295
59,311
253,213
209,448
231,738
of which: Collateralised
by commercial immovable
property
211,680
25,768
2,003
23,236
185,912
162,720
181,168
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(**) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of this note.
The analysis of the gross carrying amount and respective impairment, of loans and advances that have ever been
subject to legislative and non-legislative moratorium, with reference as at 31 December 2021:
(Thousands of euros)
Gross carrying amount
Performing\u00a0
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Inflows to
non-
performing
exposures\u00a0
in the last
12 months
Loans and advances
subject to
moratorium
10,939,554
9,990,621
696,426
3,145,093
948,933
603,174
834,070
333,500
of which: Households
5,212,656
4,968,993
258,573
1,038,745
243,663
145,907
183,807
148,835
of which:
Collateralised by
residential
immovable property
4,533,171
4,384,126
228,269
915,413
149,045
97,934
134,940
77,684
of which: Non-
financial corporations
5,632,584
4,952,474
436,068
2,046,523
680,110
436,937
625,105
184,663
of which: Small and
Medium-sized
Enterprises
5,085,424
4,503,348
372,415
1,847,727
582,076
379,997
564,032
160,075
of which:
Collateralised by
commercial
immovable property
1,895,246
1,590,586
286,092
988,440
304,660
179,465
302,064
100,596
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(Thousands of euros)
Accumulated impairment (**)
Performing
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Loans and advances subject
to moratorium
553,384
149,636
30,170
116,166
403,748
292,759
341,535
of which: Households
82,892
23,826
1,263
15,128
59,066
28,719
32,192
of which: Collateralised
by residential immovable
property
27,624
8,881
650
5,337
18,743
11,215
15,451
of which: Non-financial
corporations
443,230
123,257
28,399
98,551
319,973
244,161
284,634
of which: Small and
Medium-sized Enterprises
380,880
115,080
26,813
92,831
265,800
202,059
258,473
of which: Collateralised
by commercial immovable
property
178,995
56,281
22,189
52,713
122,714
88,507
122,342
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(**) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of this note.
Loans and advances granted under new public guaranteed schemes introduced in response to the COVID-19 crisis
In what concerns the loans granted under new public guaranteed schemes, we present below the exposure breakdown
by segment, the amount of the associated guarantee and an indication of the portion classified as restructured due to
financial difficulties or classified as non-performing is presented.
As at 31 December 2022, the analysis of the loans and advances subject to public guarantee schemes is as follows:
(Thousands of euros)
2022
Gross carrying amount
Maximum amount of
the guarantee that
can be considered
Gross carrying amount
of which:
forborne
Public guarantees
received
Inflows to non-performing
exposures in the last 12
months
Newly originated loans and advances subject
to public guarantee schemes
2,364,357
2,427
1,955,939
22,442
of which: Households
12,240
\u2014
10,836
168
\u00a0 of which: Collateralised by residential
immovable property
233
\u2014
210
\u2014
of which: Non-financial corporations
2,351,605
2,427
1,944,663
22,268
of which: Small and Medium-sized
Enterprises
2,162,873
2,427
1,810,326
22,268
of which: Collateralised by commercial
immovable property
81,559
\u2014
60,860
1,006
suppliers/customers, from the Ukraine, Russia and Belarus markets, above 15%, were considered as potentially more
vulnerable and were assessed on a case-by case-basis.
- Regarding a more-broader macroeconomic perspective (3rd order effects), the Bank updated at the end of the first
semester the list of sectors potentially more vulnerable to the current macroeconomic and geopolitical context, which
remains in force.
In what concerns the internal rating structure of the credit portfolio in vulnerable sectors, we can conclude that 7,5%
of the portfolio is classified as non-performing and around 54% are allocated to risk grade 8 or better.
For those clients potentially more affected, directly and/or indirectly, by the conflict it was applied a bottom-up
monitoring approach.
The bottom-up assessment is supported by the combination of a comprehensive credit monitoring initiatives, notably:
1. the update of the impairment signs questionnaire (for customers with more significant exposures).
2. the process of assignment of a set of pre-defined credit strategy to each client (less favourable strategies have
shorter periods of validity and the assignation of a \"minimization of expected loss\u201d strategy implies the reclassification
of the Client to Stage 3.)
3. specific engagement questionnaire sent to corporate clients to assess the impacts of the conflict after it arose, and
its conclusions are considered to remain valid, as the reality found in the daily interaction with clients confirms.
Until the end of December 2022, no relevant signs of risk continue to be not identified (the total volume of credits
associated with performing clients with past due exposures represents only 0,2% of total exposures).
In Poland the analysis of the impact in Corporate clients was supported on a case-by-case review of a significant part of
the corporate portfolio, independently of the sector of activity of each client.
Following the review of the companies' exposures, namely taking into account the 15% materiality/exposure factor
mentioned above, Bank Millennium (Poland) conducted a separate check of the companies exposed to risks related to
the conflict in Ukraine, and a subset of companies with a total exposure of EUR 81.8 million (Q3 2022 figures),
equivalent to only 1.4% of the Bank Millennium Group's portfolio of companies. All the companies identified have
already implemented measures to diversify their supply chains, so no company was considered that needed being
treated as significantly exposed to this risk. Regardless of the positive experience to date, Bank Millennium Group
decided to temporarily avoid increasing funding to this set of companies.
Application of Decree-Law 80-A/2022 - Mitigation of impacts on mortgage contracts
Specifically with regard to Decree-Law 80-A/2022, a Portuguese Government act of 25 November 2022 that established
measures to mitigate the effects of the increase in the reference indexing factors of credit contracts for the acquisition
or construction of permanent house ownership, it is worth highlighting the fact that it introduced the obligation for
Financial Institutions to approach individual customers with mortgage credit who potentially fit into the requirements
set out in that act.
In what concerns Millennium bcp, a contact was promoted with about 180 thousand customers, requesting information
in order to calculate the respective effort rate. At the end of December 2022, the number of customers who showed
interest in joining the mechanisms provided for in Decree-Law 80-A/2022 was limited, especially given that the
deadline for replying to the Bank's contact only ended in January 2023.
On 28 February 2023 the number of restructuring requests under Decree Law 80-A/2022 amounted to only 5 thousand
customers, of which only 4 thousand meet the conditions for potential implementation of restructuring measure.
Credit concentration risk
The Group\u2019s policy relating to the identification, measurement, and evaluation of the concentration risk in credit risk is
approved by the Bank\u2019s management body, applied to all Group entities, and is based on the following guidelines:
The monitoring of the concentration risk and the follow-up of major risks is made, at Group level, based on the concept
of \"Economic Groups\" and \u201cCustomer Groups\u201d - sets of connected Customers (individual persons or companies), which
represent a single entity from a credit risk perspective, such that if one of them is affected by financial problems, one
or all of the others, will probably face difficulties to fulfil their debtor obligations. The Customer connections that
originate a Customer group include the formal participation on the same economic group, the evidence that a direct or
indirect control relationship exists, including the control by an individual Customer (criteria of capacity of control) of a
company or the existence of a strong commercial interdependency or common sources of funding that cannot be
replaced on a short term (criteria of economic dependency).The identification of connected clients is an integral part
of the credit granting and monitoring processes of each entity.
For the control of credit concentration risk and limit the exposure to this risk, there are limits defined for:
1)Exposures to Sovereigns;
2)Exposures to Institutions (Banks/financial institutions);
3)Single-name exposures (Large Corporate exposures);
4)Geographic concentration (country risk);
5)Exposure to sectors of activity.
These limits apply to the \u2018Net exposures\u2019 (*), relating either to a counterparty or a group of counterparties \u2013 cases for
1), 2) and 3) \u2013 or to the set of exposures to an activity sector or to a country (the counterparty country of residence) \u2013
cases for 4) and 5). The metrics regarding the concentration of exposure to Sovereigns and geographic concentration
exclude the countries in which the Group has significant operations (Portugal, Poland and Mozambique) and the
respective Sovereigns.
Except for exposure to sectors of activity, the concentration limits are established by taking into consideration the
credit worthiness of the debtors at stake in what concerns their rating grades/probability of Default (PD) (internal or
external ratings; country rating in the case of geographic concentration).
The concentration limits for Corporate single-name exposures apply only to non-NPE positions, since the NPE(**)
positions are covered by the NPE reduction Plan defined and executed at Group BCP level.
The limits in force as at 31 December 2022, for the exposure to Single-name, in terms of the Net Exposure weight over
the Consolidated Own Funds, are the following:
Risk quality
Risk grade
Single-name
High quality
1 - 5
7.0%
Average/good quality
6 - 7
4.5%
Average low/quality
8 - 9
3.0%
Low quality
10 - 11
0.6%
Restricted credit
12 - 13
0.3%
(*) Net exposure = EAD x LGD, considering LGD=45% whenever own estimates for LGD are not available or applicable. EAD = Exposure
at default ; LGD = Loss given Default;
(**) NPE = Non-performing exposures
As at 31 December 2022:
- There were no exposure excesses to Sovereigns, Institutions or countries;
- There were 4 Economic Groups with net exposure above the established Single-name limits for their respective risk
grade. For each client with an exposure excess a specific plan is prepared, aiming at reducing the exposure and
bringing it within the established limits.
It should also be referred that the assessment of the Single-name concentration is also performed within the Group RAS
(Risk Appetite Statement) scope.
In what concerns the limit for exposure to sectors of activity, in force on 31 December 2022, this is defined as a
maximum of 40% per sector of activity, in terms of the weight of the Net Exposure for each sector of activity over the
Own Funds of each Group Entity. At this date, there was no excess over this limit.
The Bank's management body and the Risk Assessment Committee are regularly informed on the evolution of the credit
concentration risk metrics (against the mentioned limits) and on major risks.
The credit concentration risk is measured and monitored by the Risk Office supported on a database on credit
exposures (the Risk Office Datamart), monthly updated by the Group\u2019s systems, which feeds the risk management
system of the Group.
The Risk Office maintains a simulation tool for supporting the analysis of the impact on changes on the Customers
exposures in the consumption of the respective concentration limits, which is used by the Credit Division and by the
Commercial Networks within the scope of credit analysis for large clients.
Market risk
Market risks consist of the potential losses that might occur in a given portfolio as a result of changes in interest or
exchange rates and/or in the prices of the different financial instruments of the portfolio, considering not only the
correlations that exist between those instruments but also their volatility.
For purposes of profitability analysis and market risks quantification and control, the following management areas are
defined for each entity of the Group:
- Trading - Management of positions whose objective is the achievement of short-term gains, through sale or
revaluation. These positions are actively managed, tradable without restriction and may be valued frequently and
accurately. The positions in question include securities and derivatives of sales activities;
- Funding - Management of institutional funding (wholesale funding) and money market positions;
\u2013Investment - Management of all the positions in securities to be held to maturity (or for a longer period of time) or
positions which are not tradable on liquid markets;
- Commercial - Management of positions arising from commercial activity with Customers;
- Structural - Management of balance sheet items or operations which, due to their nature, are not directly related to
any of the management areas referred to above; and
- ALM - Assets and Liabilities Management.
The definition of these areas allows for an effective management separation of the trading and banking books, as well
as for the correct allocation of each operation to the most suitable management area, according to its respective
context and strategy.
In order to ensure that the risk levels incurred in the different portfolios of the Group comply with the predefined
levels of tolerance to risk, various market risks limits are established, at least yearly, being applicable to all portfolios
of the risk management areas over which the risks are incident. These limits are monitored on a daily basis (or intra-
daily, in the case of financial markets) by the Risk Office.
Stop loss limits are also defined for the portfolios of the financial markets areas \u2013 Trading and Financing \u2013 based on
multiples of the risk limits defined for them, aiming to limit the maximum losses that may occur in these areas. If these
limits are reached, a review of the underlying business strategy and the assumptions relating to the management of the
positions in question is mandatory
Market risks of the prudential trading book (1)
For the daily measurement of general market risk - including interest rate risk, exchange rate risk, equity risk and price
risk of credit default swaps (indexes) - a VaR (value-at-risk) model is used, considering a time horizon of 10 business
days and a significance level of 99%.
The Group also uses another integrated market risk measure that allows monitoring of all risk sub-types considered
relevant. This measure integrates the assessment of generic risk, specific risk, non-linear risk and commodity risk. Each
of these sub-types of risk is measured individually, using an appropriate risk model, with the integrated measure
calculated from the measures for each one, without considering any type of diversification between the four sub-types
(worst approach case scenario).
For non-linear risk, an internally-developed methodology is applied, replicating the effect that the main non-linear
elements of options might have in P&L results of the different portfolios in which these are included, similarly to what
is considered by the VaR methodology, using the same time horizon and significance level.
Specific and commodity risks are measured through standard methodologies defined in the applicable regulations, with
an appropriate change of the time horizon considered.
The table below presents the amounts at risk for the Trading Book, as at 31 December 2022 and 2021, measured by the
methodologies referred to above:
(Thousands of euros)
2022
Max of global risk
in the period
Min of global risk
in the period
2021
Generic Risk ( VaR )
1,322
6,586
1,049
1,533
Interest Rate Risk
1,011
3,836
962
1,432
FX Risk
841
4,195
482
469
Equity Risk
585
36
589
274
Diversification effects
1,114
1,481
984
(642)
Specific Risk
13
37
15
35
Non-Linear Risk
\u2014
\u2014
\u2014
\u2014
Commodities Risk
\u2014
\u2014
\u2014
\u2014
Global Risk
1,335
6,623
1,064
1,568
In order to check the appropriateness of the internal VaR model to the assessment of the risks involved in the positions
held, several validations are conducted over time, of different scopes and frequency, which include back testing, the
estimation of the effects of diversification and the analysis of the comprehensiveness of the risk factors.
As a complement to the VaR assessment, the Group continuously tests a broad range of stress scenarios analysing the
respective results with a view to identifying risk concentrations that have not been captured by the VaR model.
Interest rate risk
The evaluation of interest rate risk derived from Banking Book operations is assessed through a process of risk
sensitivity analysis, undertaken every month, covering all the operations included in the Group's consolidated Balance
Sheet and discriminated by exposure currency.
Variations of market interest rates influence the Group's net interest income, both in the short term and medium/long
term, affecting its economic value in a long-term perspective. The main risk factors arise from the repricing mismatch
of portfolio positions (repricing risk) and from the risk of variation in market interest rates (yield curve risk). Besides
this, although with less impact, there is the risk of unequal variations in different reference rates with the same
repricing period (basis risk).
In order to identify the exposure of the Group's banking book to these risks, the monitoring of the interest rate risk
takes into consideration the financial characteristics of each of the relevant contracts, with the respective expected
cash-flows (principal and interest, without the spread component but including costs for liquidity, capital, operational
and other) being projected according to the repricing dates, thus calculating the impact on economic value resulting
from alternative scenarios of change of market interest rate curves.
The interest rate sensitivity of the balance sheet, by currency, is calculated as the difference between the present
value of the interest rate mismatch discounted at market interest rates and the discounted value of the same cash
flows simulating parallel shifts of the market interest rates.
(1) Trading Book - positions allocated to the Trading Management Area (and not specifically to the accounting trading book)
The following tables show the expected impact on the banking book economic value of parallel shifts of the yield curve
by +/- 100 and +/- 200 basis points, for each of the main currencies in which the Group holds material positions:
(Thousands of euros)
2022
Currency
-200 bp(*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
1,422
741
(763)
(1,544)
EUR
(99,549)
(50,069)
50,011
99,465
PLN
(71,253)
(35,436)
34,996
69,502
USD
(32,091)
(15,661)
14,937
29,193
(201,471)
(100,425)
99,181
196,616
are prepared in their functional currency and translated into Euros at the end of each financial period. The exchange
rates used for the conversion of balance sheet foreign currency amounts are the ECB reference rates at the end of each
period. In foreign currency conversion of results, are calculated average exchange rates according to the closing
exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
(Balance sheet)
(Income statement)
Currency
2022
2021
2022
2021
AOA
543.2680
632.4200
487.7116
747.0708
BRL
5.6390
6.3364
5.4153
6.3950
CHF
0.9872
1.0362
1.0042
1.0811
MOP
8.5744
9.1330
8.5744
9.1330
MZN
68.1850
72.9000
67.5585
77.9329
PLN
4.6816
4.5839
4.6823
4.5623
USD
1.0667
1.1373
1.0537
1.1833
Foreign exchange and equity risk of the banking book
The foreign exchange risk of the banking book is transferred internally to the Trading Area, in accordance with the risk
specialization model followed by the Group for the management of the balance sheet foreign exchange risk. The
structural foreign exchange exposures, namely those resulting from financial holdings in subsidiaries, are not included
in this transfer and are hedged through market operations, taking into consideration the defined strategy for managing
structural foreign exchange risk, whose objective is to hedge against the volatility in the CET1 ratio that stems from
changes in foreign currency exchange rates.
As at 31 December 2022, the Group 's financial investments in foreign currency were not hedged.
Whenever these hedges exist on a consolidated basis, are identified in accounting terms as net investment hedges, in
accordance with the IFRS nomenclature. On an individual basis, they are designated as fair value hedges of equity
investments.
The information on the gains and losses on instruments used to hedge net investments in foreign institutions are
recognized in foreign exchange reserves and presented in the statement of comprehensive income.
The transfer to Portugal of funds, including dividends, that are owed by BCP's subsidiaries or associates in third
countries, namely outside the European Union, may be subject to the restrictions and exchange controls that, at any
given time, are in force in the country in which the subsidiaries are constituted or associated.
In what concerns to the equity risk, the Group keeps a set of small-scale, low-risk positions, essentially in the
investment portfolio, namely resulting from execution/payment processes. The management of these positions is
carried out by a specialized area of the Group, with the respective risk being controlled through the metrics and limits
defined for controlling market risks.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators defined by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also defined.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is based
on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are calculated on a
daily basis, taking into account the impact in the liquidity buffers available to discount with the respective central
banks at the reference date of future estimated cash flows for each of the respective time horizon (3 days or 3 months)
considering the set of transactions intermediated by the market areas, including in this context transactions with
clients of the Corporate and Private networks, which, due to their size, must be quoted by the Trading Room. The
remaining buffer in each time bucket is then compared to the amount of customer deposits, being the indicators
assessed against exposure limits defined in the Bank's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis identifying all the
factors that justify the variations that occur. This analysis is submitted to the Capital and Assets and Liabilities
Committee (CALCO) for appraisal, to enable the decision making that leads to the maintenance of financing conditions
adequate to the continuation of the business.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterize the Bank's risk profile and to ensure that the Group and
each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support the
liquidity contingency plan and management decisions.
In 2022, the liquidity positions of BCP, Bank Millennium and BIM reinforced their robustness, based mainly on the
growth of the respective customer deposit bases. This growth was particularly significant in the operation in Portugal,
in which it reached approximately 10%, mainly through the contribution of the retail depositors\u2019 segment. The main
source of financing for the operation in Portugal thus saw its stability reinforced, supporting, as in previous years, a
favourable evolution of the commercial gap.
Accordingly, the regulatory Liquidity Coverage Ratio (LCR), an indicator of short-term liquidity risk, stood at 212% on a
consolidated basis at the end of December 2022 (31 December 2021: 269%), well above the minimum regulatory
requirement of 100%, supported by portfolios of highly liquid assets whose value is compatible with a prudent liquidity
management by the Group.
The regulatory Net Stable Funding Ratio (NSFR), an indicator of structural liquidity risk, increased from 150% on 31
December 2021 to 154% on 31 December 2022, also above the regulatory minimum of 100%, mainly based on the growth
of the customer deposit portfolio.
The loan-to-deposit transformation ratio, another structural indicator of the RAS (calculated in accordance with Bank of
Portugal Instruction no 16/2004, in force), also evolved favourably from a liquidity risk perspective, from 81% on 31
December 2022 to 74% one year later.
It should be noted that, in the annual risk review for 2023, the internal limits for the RAS indicators remained
unchanged facing 2022.
Regarding the presence of the Bank in the debt segment of the capital market, it is worth highlighting the following
events, in chronological order: (i) in May, BCP repaid a covered bond issue in the amount of Euros 1,000,000,000. Given
the Bank's surplus position in terms of liquidity, there was no need to refinance the amount repaid in the market; (ii) in
October, the Bank placed its third issue of senior preferred debt on the market in a 3NC2 format (3 years maturity
callable after 2 years) in the amount of Euros 350,000,000. The operation was aimed at ensuring compliance with the
requirements of \u201cMREL\u201d (Minimum Requirements for Own Funds and Eligible Liabilities), namely the indicative target
that will be in force during 2023, from 1 January. This issue, with a coupon of 8.50% per annum (corresponding to a
spread of 554.7bps over mid-swaps) was carried out in very difficult market conditions, demonstrating the Bank's ability
to access the market even in an adverse and very complex environment; and (iii) in November, and considering that in
view of the prevailing market conditions the Bank had decided not to exercise, in December, the early repayment
option on a T2 issue of\u00a0 Euros 300,000,000, BCP launched an offer to exchange these securities not reimbursed, in the
ratio of 1:1, by others of the same nature, to be issued. Thus, given the non-exercise of the call-option, investors were
offered the option to exchange the bonds they held for newly issued securities with a higher coupon and longer term.
The amount of the new issue 10.25NC5.25 of T2 was set at Euros 133,700,000 and the coupon at 8.75%, per annum,
corresponding to a spread of 605.1bps over mid-swaps.
Still with regard to the funding structure, BCP repaid in advance in December 2022 the first tranche of the Targeted
longer term refinancing operation III (\u201cT LTRO III\u201d), contracted in June 2020 in the amount of Euros 7,550,070,000 (with
the second tranche, amounting to Euros 600,000,000, already repaid in January 2023). Considering the balance in
deposit at the Bank of Portugal and other available liquidity, BCP ended 2022 with a long position on the Eurosystem of
Euros 2,574,146,000.
Throughout 2022, the behaviour of the liquidity buffer at the ECB was mainly determined by the impacts, in opposite
directions, of the aforementioned favourable evolution of the commercial gap, on the one hand and, on the other
hand, of the growth of the margin calls related to derivatives and the decrease of the market price of the assets
eligible for discount with the Eurosystem, effects that showed a growing trend after the outbreak of war in Ukraine.
The combined effect of these and other factors of lesser materiality allowed, nevertheless, the buffer to grow Euros
2,749,283,000 on an annual basis, to Euros 26,520,745,000.
Likewise, in the year ended December 2022, Bank Millennium and BIM demonstrated the resilience of their liquidity
positions, supported by their retail deposit bases and robust buffers discountable at the respective central banks, with
regulatory and internal indicators of liquidity risk positioned comfortably above the comfort thresholds. In the case of
the operation in Poland, this occurred even considering the effects of the invasion of Ukraine, which resulted in the
significant devaluation of the eligible asset portfolio and the strengthening of derivatives\u2019 margin accounts.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after haircuts,
is detailed as follows:
(Thousands of euros)
2022
2021
European Central Bank
13,677,518
13,394,653
Other Central Banks
5,213,823
4,840,405
18,891,341
18,235,058
with possible situations of financial stress. The measures for its reinforcement are described in the Recovery Plan
which, at 31 December 2022, had a total estimated value for Portugal of Euros 3,750,000,000, arising from the sale of
corporate bonds and commercial paper, securitization of a portfolio of consumer credit and issuance of retained
covered bonds to be mobilized for the ECB's monetary policy pool.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels over the
next three years, with annual refinancing needs with no material expression.
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk Committee, the
following information is presented in accordance with Commission Implementing Regulation (EU) 2021/637 of 15 March
2021 supplementing Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to
regulatory technical standards for disclosure of encumbered and unencumbered assets.
(Thousands of euros)
2022 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the disclosing
institution
13,756,969
1,091,650
82,775,892
25,254,479
Equity instruments
\u2014
\u2014
\u2014
\u2014
127,810
\u2014
127,810
\u2014
Debt securities
1,091,650
1,091,650
968,647
968,647
20,604,616
15,841,854
20,024,958
15,227,018
of which: securitisations
\u2014
\u2014
\u2014
\u2014
29,291
\u2014
24,793
\u2014
of which: issued by
general governments
1,052,101
1,052,101
930,126
930,126
15,452,215
14,962,526
14,877,737
14,391,677
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
1,804,297
119,941
1,804,289
119,941
of which: issued by non-
financial corporations
39,560
39,560
38,521
38,521
2,754,650
541,928
2,754,901
541,928
Other assets
12,793,413
\u2014
61,561,554
8,879,947
(1)Table's figures are calculated by the median of the values disclosed in the regulatory information for the previous 4 quarters.
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2022 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing institution
\u2014
\u2014
88,857
1,502
Debt securities
\u2014
\u2014
1,502
1,502
of which: issued by general governments
\u2014
\u2014
1,502
1,502
Loans and advances other than loans on demand
\u2014
\u2014
87,393
\u2014
Own covered bonds and securitisations issued
and not yet pledged
6,113,493
\u2014
TOTAL COLLATERAL RECEIVED AND OWN DEBT
SECURITIES ISSUED
13,756,969
1,091,650
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered
bonds and securitisations encumbered
Carrying amount of selected financial liabilities
10,520,000
13,256,892
At the end of 2022, and according to the EBA methodology, the total encumbered assets represents 14% of the Group's
total balance sheet assets. The encumbered Loans to customers represents 81% of the total encumbered assets, while
Debt securities represents 8%.
The encumbered assets are mostly related with the Portugal's activity funding operations, namely with the ECB,
securitisation programs and derivatives operations. The type of assets used as collateral for these financing transactions
are different Loans to Customers\u2019 portfolios, supporting securitisation programs and mortgage bonds, intended to
reinforce the collateral pool with the ECB. Regarding the collateralization of derivative operations, as well as financing
operations with the European Investment Bank, is mainly supported by sovereign debt eligible for central banks,
together with bonds issued by public sector companies.
On 31 December 2022, the Other assets includes unencumbered assets in the amount of Euros 8,477,357,000 related to
Loans on demand, the amount of Euros 56,201,560,000 related to Loans and advances other than loans on demand (of
which encumbered assets in the amount of Euros 11,188,611,000) and the amount of Euros 8,601,987,000, mostly
unencumbered and related to the Group\u2019s activity, namely, to: investments in associated companies and subsidiaries,
tangible assets and investment properties, intangible assets, assets associated with derivatives and current and
deferred taxes.
A 31 December 2022, the Group has a Euros 12.5 billion BCP Covered Bond Programme (\u201cBCP Programme\u201d) with Euros
9.2 billion of covered bonds outstanding. The BCP Programme is backed by a Euros 10.6 billion portfolio of residential
mortgages, providing an overcollateralization (\u201cOC\u201d) of 15.4%, which is above the minimum of 14% currently required
by rating agencies.
The Portuguese covered bond legislation affords covered bond holders a dual-recourse, firstly over the issuer, secondly
over the cover pool that may also include other eligible assets, over which they benefit from a special preferential
claim. The Portuguese covered bond legislation ensures total segregation of the covered pool from any future issuer\u2019s
insolvent estate, for the benefit of covered bond holders, who have precedence over claims of any other of the issuer\u2019s
creditors in case of issuer insolvency, thus and to this extent superseding the general insolvency and recovery
legislation. Residential mortgages in a cover pool are subject to certain eligibility criteria inscribed in the Portuguese
covered bond legislation, among them a maximum LTV of 80%, delinquency of no more than 90 days, and them being
first lien mortgages (or, if otherwise, all preceding liens being in the cover pool) over properties located in the EU. The
BCP\u2019s Programme documentation limits property location to Portugal only.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2022
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
At sight
Total
Assets
Cash and deposits at Central Banks
6,022,001
\u2014
\u2014
\u2014
\u2014
\u2014
6,022,001
Loans and advances to Credit
Institutions - Repayable on demand
213,460
\u2014
\u2014
\u2014
\u2014
\u2014
213,460
Other loans and advances (a)
\u2014
752,913
211,383
\u2014
\u2014
\u2014
964,296
Loans and advances to customers (a)
\u2014
\u2014
8,464,759
13,639,800
33,494,378
579,229
56,178,166
Other financial assets (b)
\u2014
777,004
1,371,845
5,090,680
1,049,378
491,922
8,780,829
6,235,461
1,529,917
10,047,987
18,730,480
34,543,756
1,071,151
72,158,752
Liabilities
Resources from Credit Institutions
\u2014
499,654
87,373
881,333
\u2014
\u2014
1,468,360
Resources from costumers
48,673,569
14,634,189
10,956,260
1,106,125
60,000
\u2014
75,430,143
Debt securities issued
\u2014
2,008
\u2014
852,706
627,372
\u2014
1,482,086
Subordinated debt
\u2014
\u2014
\u2014
314,519
1,018,537
\u2014
1,333,056
48,673,569
15,135,851
11,043,633
3,154,683
1,705,909
\u2014
79,713,645
(a)Gross of impairment
(b)Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
Operational Risk
The operational risk management system is framed by the \u201c3 Lines of Defence\u201d Corporate Governance model and is
based on an integrated structure of end-to-end processes, considering that a vision which is transversal to the
functional units of the organisational structure is the most suitable approach for the perception of risks and to estimate
the effects of the corrective measures introduced for their mitigation. Furthermore, these processes model also
underlies other strategic initiatives related to the management of this risk such as the actions to improve operating
efficiency and the management of business continuity. Hence, the most relevant Group subsidiaries have their own
process's structure, which is periodically adjusted according to business evolution, in order to ensure suitable coverage
of the business activities (or business support activities) developed, ensuring thus, the replication of the 3 Lines of
Defence model in the management of operational risk.
The responsibility for the day-to-day processes\u2019 management lies with the 1st Line of Defence: the process owners
(seconded by process managers), whose mission is to characterise the operational losses captured under their
processes, to monitor the respective Key Risk Indicators (KRI), to perform the Risks Self-Assessment (RSA) exercises, as
well as to identify and implement suitable actions to mitigate operational risk exposures, thus contributing to the
strengthening of control mechanisms and the improvement of the internal control environment. The periodic revision of
the main processes in each geography is ensured by local structure units.
The Risk Management function (materialised in the Risk Office) and the Compliance function (materialised in the
Compliance Office) represent the 2nd Line of Defence and are responsible for implementing the risk policy defined for
the Group, proposing and developing approaches for managing this risk, supervising their implementation and
challenging the 1st Line of Defence regarding the risk levels incurred. The Internal Audit function embodies the 3rd Line
of Defence and supervises the appropriate fulfilment of the functions and activities of the remaining two lines of
defence.
In 2022, the usual operational risk management activities continued to be executed by the various players involved in
the management of this risk, aiming at an efficient and systematic identification, evaluation, mitigation and control of
exposures, as well as at the appropriate reporting tasks, either to the Group\u2019s\u00a0 management bodies or within regulatory
duties. The results of the RSA exercises evidence a robust control environment, demonstrating the Group's commitment
to operational risk management through the continuous development of improvement actions that help mitigate
exposures to this risk. Regarding the operational losses registered, it should be highlighted that their pattern was not
different from what is usual and expected, with a higher frequency of losses of low amounts, without concentration in
significant amounts.
It should also be noted that the last 5-years average of the ratio between gross losses and the relevant indicator for TSA
(gross income) has consistently presented values below 1%, which compares favourably with international benchmarking
and attests the robustness of the operational control environment of the Group. The monitoring of KRI has allowed to
identify opportunities for improvement that, together with the RSA exercises and the process of identification and
registration of losses, provide for an effective management of this risk.
The Bank's mobilisation\u00a0to reinvent the banking experience, based on the digitization and use of new technologies,
entails relevant challenges in the management of operational risk, which include the reinforcement of the security of
digital banking channels, the reinforcement of mechanisms for the prevention and detection of potential fraud, proper
management of personal data and compliance with the information duties legally provided for in sales through digital
banking channels.
Covenants
The contractual terms of instruments of various wholesale funding instruments encompass obligations assumed by
entities belonging to the Group as borrowers or issuers, concerning general duties of corporate conduct, maintenance
of banking activity and the inexistence of special guarantees constituted for the benefit of other creditors (\u201cnegative
pledge\u201d). These terms essentially reflect the internationally adopted standards for each of the types of debt
instruments used by the Group.
The terms of the Group\u2019s participation in securitization operations involving its own assets are subject to mandatory
changes in case the Group stops respecting certain rating criteria. The criteria established in each transaction results
mainly from the existing risk analysis at the moment that the transaction was set, being these methodologies usually
applied by each rating agency in a standardised way to all the securitization transactions involving the same type of
assets.
Regarding the Covered Bond Programs of Banco Comercial Portugu\u00eas, there are no relevant covenants related to a
possible downgrade of BCP.
Hedge accounting
As at 31 December 2022, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2022
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
11,962,045
27,696
7,031
309,506
Foreign exchange risk
Currency and interest rate swap
431,257
2,999
18,432
(717)
12,393,302
30,695
25,463
308,789
Cash flows hedging
Interest rate risk
Interest rate swaps
14,559,138
\u2014
110,562
(1,513,397)
Foreign exchange risk
Currency and interest rate swap
1,273,663
29,008
41,975
(10,527)
15,832,801
29,008
152,537
(1,523,924)
Total
28,226,103
59,703
178,000
(1,215,135)
(A)Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31 December 2021, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2021
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
15,464,986
74,261
28,509
127,033
Foreign exchange risk
Currency and interest rate swap
347,329
12,043
121
(29)
15,812,315
86,304
28,630
127,004
Cash flows hedging
Interest rate risk
Interest rate swaps
15,781,769
19,617
283,335
(324,922)
Foreign exchange risk
Currency and interest rate swap
1,691,525
3,138
65,008
(1,241)
17,473,294
22,755
348,343
(326,163)
Hedging of net investments in foreign entities
Foreign exchange risk
Currency and interest rate swap
153,427
\u2014
233
(1,045)
Total
33,439,036
109,059
377,206
(200,204)
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
As at 31 December 2021, the table below includes the detail of the hedged items:
(Thousands of euros)
2021
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change
in fair
value (A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
745,328
\u2014
(1,678)
\u2014
(8,237)
n/a
n/a
(H)
4,133,227
\u2014
(12,706)
\u2014
(20,638)
n/a
n/a
(C)
6,574,692
\u2014
41,485
(2,013)
(117,932)
n/a
n/a
(D)
\u2014
10,000
\u2014
93
140
n/a
n/a
(E)
\u2014
12,350
\u2014
490
311
n/a
n/a
(F)
\u2014
497,998
\u2014
(985)
979
n/a
n/a
(G)
\u2014
758,076
\u2014
(4,530)
5,754
n/a
n/a
Foreign exchange risk
Currency and interest rate
swap
\u2014
347,329
\u2014
(66)
98
n/a
n/a
11,453,247
1,625,753
27,101
(7,011)
(139,525)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
15,781,551
\u2014
\u2014
\u2014
324,922
(263,143)
131,353
Foreign exchange risk
Currency and interest rate
swap
(B)
1,691,525
\u2014
\u2014
\u2014
1,939
(9,567)
(285)
17,473,076
\u2014
\u2014
\u2014
326,861
(272,710)
131,068
Hedging of net investments
in foreign entities
Foreign exchange risk
- Bank Millennium, S.A.
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
Total
28,926,323
1,625,753
27,101
(7,011)
188,381
(217,384)
131,068
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
The reconciliation of each equity component and an analysis of other comprehensive income attributable to hedge
accounting, with reference to 31 December 2022 and 2021, is as follows:
(Thousands of euros)
Cash flow hedge reserve
Exchange differences
2022
2021
2022
2021
Balance as at 1 January
(141,642)
262,288
55,326
56,371
Amounts recognised in other comprehensive income:
\u00a0 Hedging cash flows
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,523,207)
(326,958)
\u2014
\u2014
\u00a0 \u00a0 Foreign exchange changes
1,725
42
\u2014
\u2014
\u00a0 \u00a0 Hedge breakage
(123,938)
(75,565)
\u2014
\u2014
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
1,333
107
\u2014
\u2014
\u00a0 \u00a0 Others
(2,279)
(1,556)
\u2014
\u2014
\u00a0 Hedging of net investments - foreign exchange risk
\u00a0 \u00a0 Reclassified to the income statement
\u2014
\u2014
3,685
(1,045)
Change in the fair value of settled transactions
\u2014
\u2014
(59,011)
\u2014
Balance at the end of the year
(1,788,008)
(141,642)
\u2014
55,326
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2022:
(Thousands of euros)
2022
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiven
ess
recognised
in Income
statement
(A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(17,717)
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
362
\u2014
\u2014
\u2014
(17,355)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(66,333)
(238)
(E)
54,861
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(15,838)
(1,333)
\u2014
\u2014
(82,171)
(1,571)
54,861
\u2014
Total
(82,171)
(18,926)
54,861
\u2014
(A)Income Statement item in which the ineffectiveness of the hedge was recognised
(B)Income Statement item in which the reclassified amount was recognised
(C)but which are no longer expected to occur
(D)Net gains/(losses) from hedge accounting operations
(E)Interest income
(F)Net gains/(losses) from foreign exchange
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2021:
(Thousands of euros)
2021
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(12,590)
\u2014
\u2014
Interest rate futures
(D)
\u2014
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
69
\u2014
\u2014
\u2014
(12,521)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(72,809)
(699)
(E)
68,038
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(6,156)
(107)
\u2014
\u2014
(78,965)
(806)
68,038
\u2014
Hedging of net investments in
foreign entities
Foreign exchange risk
(F)
Currency and interest rate swap
(1,045)
\u2014
\u2014
\u2014
Total
(80,010)
(13,327)
68,038
\u2014
The table below shows the detail of hedging instruments, as at 31 December 2021, by maturity:
(Thousands of euros)
2021
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months to 1
year
Over 1
year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
342,503
1,076,631
14,045,852
15,464,986
74,261
28,509
Fixed interest rate (average)
1.54%
0.57%
0.25%
0.30%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
171,466
175,863
\u2014
347,329
12,043
121
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
\u2014
174,524
15,607,245
15,781,769
19,617
283,335
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
210,017
160,365
1,321,143
1,691,525
3,138
65,008
Hedging derivatives related to
net investment in foreign operations:
OTC Market:
Currency and interest rate swap
153,427
\u2014
\u2014
153,427
\u2014
233
Total derivatives traded by
OTC Market:
877,413
1,587,383
30,974,240
33,439,036
109,059
377,206
their impacts occurs by means of the \u201ctraditional\u201d categories: credit risk, market risk, operational & reputation risk,
liquidity and financing risks.
Within this context, and with the purpose of promoting the integration of ESG factors in risk management, the Bank
implemented a set of processes and methodologies to identify, assess, manage and monitor the impact of the ESG
category in overall risk, in accordance with the framework and policies already established for the remaining financial
and non-financial risks.
Governance Model
The governance model for risks arising from ESG factors follows a structure based on three lines of defence which,
under the leadership of the Board of Directors (and respective delegations on the Executive Committee), ensure its
adequate assessment and management.
The first-line functions comprise all the departments and business areas that interact with the Bank\u2019s customers,
counterparties and suppliers, collect the information and data that support the assessment of their risk profiles (and of
their respective operations) and structure the commercial solutions with characteristics associated with the ESG or with
the promotion of control of their impacts on the Bank's risk profile.
Between the first and second lines of defence, the role of the Sustainability Function is established, whose
responsibilities include a) the overall management of the sustainability strategy and plans of Millennium BCP and of its
financial group; b) the direct orientation and operational support to the first and second lines of defence in the
performance of their main responsibilities; c) the development of policies, methodologies and reports that address ESG
issues; and d) the management of commitments and external communications by the Bank and the Group in this area.
In the second line of defence, the responsibility for risk control, is assumed by the Risk Office and by the Compliance
Office. These functions ensure the procedures for the design, implementation of the policies/methodologies/ risk
management models, which are paramount in keeping the risk profile of the Group in appropriate levels.
Among other, these responsibilities, include:
\u2022Integrate the ESG dimension in risk appetite (Risk Appetite Framework - RAF);
\u2022Develop and maintain the methodologies necessary for risk assessment and management;
\u2022Carry out stress tests focused on climate and environmental risk factors;
\u2022Introduce the ESG dimension in capital and liquidity adequacy exercises;
Specifically in terms of compliance, we emphasise the following controls:
\u2022Compliance with regulations relating to sustainability and risk management arising from ESG factors;
\u2022Quality in the external reporting and disclosure of information;
\u2022Design and labelling of the commercial and investment products;
\u2022Incorporation of ESG related requirements and conditions in the Bank\u2019s contracts;
\u2022Prevention of conflicts of interest in the provision of services and products related with ESG.
The third line of defence assumes responsibility for the independent review of all ESG aspects through the annual work
plans of the Internal Audit Function.
Identification of ESG risks
Climate changes and environmental degradation factors are elements that potentially affect economic activity. These
alterations may include factors related with issues such as climate changes (mitigation, and adaptation), sustainable
use and protection of hybrid and marine resources, transition towards a circular economy, prevention and control of
pollution, protection and restoration of biodiversity.
The materialisation of these risks fundamentally stems from the exposure of Millennium BCP's banking portfolio to
customers, counterparties and invested assets whose performance may be affected or contribute to the negative
impacts of climate change and other environmental factors.
These factors may generate negative financial impacts which are identified and assessed by means of two main
dimensions:
\u2022Physical risks: arising from the physical effects of climate change and environmental degradation. They should be
categorized as a) severe risks, if they arise from extreme weather events such as fires, floods or droughts; b) chronic
risks, if they arise from progressive changes in weather and climate patterns or from a gradual loss of natural
ecosystems.
\u2022Transition risks: are the risks of any negative financial impact arising from the effort, in progress or to happen in the
future, of transition into a low-carbon and environmentally sustainable economy. These may result, for example,
from technological changes, the impact of public policies or behavioural changes in terms of demand for goods or
services (including banking services).
The materialisation of social risks is also assessed, considering the issues related with rights, well-being and interests of
persons and communities and include factors such as (in)equality, health, diversity, inclusion, labour relations,
workplace health and safety, human capital and communities.
In addition, the governance risk factors are also identified by Millennium BCP, through issues relating to leadership,
management and prevention of conflicts of interest, quality of internal control and independent reviews/auditing,
transparency and good tax practices, for example.
A methodology for assessing the materiality of ESG risks was developed in order to determine the potential impact of
those risks on the Bank\u2019s profile.
Management and monitoring principles
ESG risks management and respective strategy follows a different logic compared to 'traditional' risks, which are based
on short-term timeframes. In contrast, the materialization of ESG risks is expected to occur over extended timeframes,
which is why the establishment of strategy and risk appetite follows different timeframes. For example, if the
assessment of physical (severe) risks can determine an action strategy more focused on the short term (e.g.,
considering the establishment of additional mitigation measures, at the level of policies for granting credit and
insurance policy), the transition risks justify a more structural approach, based on collecting information, evaluating
customers and monitoring their performance over time.
From this perspective, Millennium BCP's management of ESG impacts follows the following principles:
\u2022Establishment of a responsible corporate financing policy, which excludes or conditions the Group's operations in
sectors and/or activities with greater environmental and social impact.
\u2022Integration of the strategy for managing risks arising from ESG factors into the Bank's global sustainability plan, which
steers the integration of the ESG dimension into business processes, establishing goals, timelines and a model for
controlling proper observance.
\u2022Transparent communication: the Bank publicly discloses its sustainability and ESG impact management goals and key
practices, allowing all stakeholders to evaluate the robustness of its approach, including its exposure to ESG risks.
\u2022Regular monitoring of exposure to risks arising from ESG factors through the management information routines
already established for each of the risk categories.
\u2022Internal standardisation of ESG references, through a corporate taxonomy that allows the identification and
classification of the exposures that are proven to have characteristics that promote the transition of the Portuguese
and European economy.
\u2022Focus on credit risk management, through models that promote the integration of the ESG dimension in the risk
assessment of the Bank's main companies/customers, ensuring that business decisions include an assessment of the
main impacts of ESG factors.
\u2022Information gathering and structuring, using public sources and information provided directly by customers, as a
means of improving knowledge of customers' environmental performance and the possible financial impacts
associated with any limitation on this performance.
The implementation of these principles, in turn, is promoted through an internal policy of management of the risks
arising from ESG factors, which establishes the following main risk tools:
\u2022Regular assessment of the materiality of the risks arising from ESG factors that allows confirming the alignment with
the risk appetite and the need to implement mitigation actions;
\u2022Risk assessment methodologies arising from ESG factors integrated in the credit risk assessment models;
\u2022Risk classification methodologies at portfolio level, enabling the identification of sectors, companies and exposures
more susceptible to transition and/or physical risks;
\u2022Quantification models for financed GHG emissions, promoting strategic discussion regarding the management of these
emissions and their alignment (in time) with the Paris Agreement targets;
\u2022Sensitivity analyses and stress tests focusing on climate risks.
Stress testing with a focus on climate risk
The Bank uses methodologies for analysing sensitivity and conducting stress tests to the risks arising from ESG factors
(with a focus on the climate risk component).
Considering the ESG risk materialisation horizons, this is an important risk management technique, which allows
assessing the impacts of climate change (and respective scenarios) on the financial variables that affect the value of
Millennium BCP's banking portfolio.
Based on its results, new risk exposures may be identified that require the Bank to take additional management
measures to mitigate the impacts of climate risks.
Mozambique's sovereign debt
Following a period of deceleration in economic activity and increase of inflation, reduction of Republic of Mozambique
rating, depreciation of Metical and decrease in foreign direct investment, the Bank of Mozambique has adopted a
restrictive policy, with increases in the reference rate since December 2015, as well as increasing the reserve ratio.
This set of factors constrained commercial banking in Mozambique, pushing it to pursue a strict liquidity management,
emphasis on raising funds, despite contributing to the improvement of net interest income.
According to an International Monetary Fund (IMF) statement dated 23 April 2016, existing debt guaranteed by the State
of Mozambique in an amount over USD 1 billion that had not been disclosed to the IMF. Following this disclosure, the
economic program supported by the IMF was suspended. According to an IMF statement dated 13 December 2016,
discussions were initiated on a possible new agreement with the Government of Mozambique and the terms of
reference for an external audit were agreed.
In June 2017, the Attorney General's Office of the Republic of Mozambique published an Executive Summary regarding
the above-mentioned external audit. On 24 June 2017, the IMF released in a statement that due to the existence of
information gaps in this audit, an IMF mission would visit the country to discuss audit results and possible follow-up
measures. Following this visit, the IMF requested the Government of Mozambique to obtain additional information on
the use of the funds.
On 14 December 2017, in a statement from the IMF staff, after the end of the mission held between 30 November and
13 December 2017, it was reiterated the need for the Mozambican State to provide missing information. In the
statement of the Mozambican Attorney General's Office dated 29 January 2018, it is mentioned, among other things,
that the Public Prosecutor submitted to the Administrative Court, on 26 January 2018, a complaint regarding the
financial responsibility of public managers and companies participated by the State, participants in the execution and
management of contracts for financing, supplying and providing services related to debts not disclosed to the IMF.
In the statements dated of 16 January 2017 and 17 July 2017, the Ministry of Economy and Finance of Mozambique
informed the holders of bonds issued by the Republic of Mozambique specifically \"US$726.524 million, 10.5%, repayable
securities in 2023\" that the interest payment due on 18 January 2017 and 18 July 2017, would not be paid by the
Republic of Mozambique. In November 2018, the Ministry of Economy and Finance of the Republic of Mozambique
announced that it has reached an agreement in principle on the key commercial terms of a proposed restructuring
transaction related to this debt securities with four members of the Global Group of Mozambique Bondholders. The
Bondholders currently own or control approximately 60% of the outstanding Bonds. The agreement in principle reached
by the parties, and the support of the Bondholders for the proposed restructuring, is conditional on the parties reaching
an agreement on mutually satisfactory documentation setting out the detailed terms of the restructuring including
implementation, and the mentioned Ministry obtaining all necessary approvals, including Parliamentary and government
approvals of Mozambique.
On 6 September 2019, the Ministry of Economy and Finance of the Republic of Mozambique announced the approval by
99.95% of the Bondholders of a written decision containing the terms and conditions of the restructuring proposal. The
Group has no exposure to this debt.
In May 2020, the Constitutional Council of the Republic of Mozambique issued a Judgment, declaring the nullity of the
acts related with the loans contracted by Proindicus, SA (\"Proindicus\") and Mozambique Asset Management, MAM, SA
(\"MAM\"), and the respective sovereign guarantees granted by the Government in 2013 and 2014, respectively, and on 19
October 2020, the dissolution of the two companies was registered based on an order issued by the Judicial Court of the
City of Maputo.
In the context of the liquidation of Proindicus and MAM, the Liquidator published, on 3 May 2022, an announcement in
the Jornal de Not\u00edcias de Mo\u00e7ambique, through which the creditors of those companies are notified to submit, within
thirty days counted from the said publication, the supporting documents of their credits. Following the publication of
the said announcement, BIM and BCP submitted, on 1 June 2022, their credit claims on Proindicus and MAM,
respectively.
An action brought on 27 February 2019 and amended on 30 April 2020, by the Republic of Mozambique (represented by
the Attorney General of the Republic) against the arranger and originating lender of the loan to Proindicus and other
entities, by which the Republic of Mozambique requests, inter alia, the declaration of nullity of the sovereign
guarantee of the Mozambican State to the Proindicus loan. Following this lawsuit, on 27 April 2020, the Banco
Internacional de Mo\u00e7ambique (BIM) filed a lawsuit, in the London Commercial Court, against the arranger and lender of
the loan to Proindicus, claiming, inter alia, payment of BIM's exposure to the Proindicus, in the event that the said
sovereign guarantee of the State of Mozambique to Proindicus is, in a court of law declared null and void. Considering
the dependency of this claim in relation with the lawsuit brought by the Republic of Mozambique above mentioned, it is
expected that the judgment sessions of the claim brought by BIM will only take place simultaneously or after the
judgment sessions scheduled for the beginning of October 2023, relating to the lawsuit filed by the Republic of
Mozambique.
Regarding MAM, as far as we are aware, no lawsuit with the same purpose was brought by the Republic of Mozambique
at the London Commercial Court. However, it is expected that, in the context of ongoing legal proceedings, that
several creditors of MAM (including BCP) have filed, at the London Commercial Court, against MAM and the Republic of
Mozambique in order to recover their credits, the question of the validity of the sovereign guarantee of the
Mozambican State to the MAM loan will be raised by the Republic of Mozambique. In July 2021, London Commercial
Court decided that the various lawsuits brought by several creditors of MAM (including BCP) against the Republic of
Mozambique, as guarantor, and MAM, as debtor, as well as the lawsuit brought by the Republic of Mozambique within
the scope of the loan to Proindicus, must be judged through a unitary trial and scheduled the start of the respective
trial sessions for 3 October 2023 and several interim sessions related to the process of collecting and disclosure of
evidence (DRD - Disclosure Review Documents), which is still ongoing.
According to public information made available by the IMF, there are defaults on credits granted to non-state
Mozambican companies' and guaranteed by the Mozambican State. Considering the above-mentioned developments
related to these credits, although the Ministry of Economy and Finance of the Republic of Mozambique has submitted in
November 2018 new proposals regarding this matter and interactions are ongoing between the Government of
Mozambique, the IMF and the creditors with the objective of finding a solution to the aforementioned debt guaranteed
by the State of Mozambique, which had not been previously disclosed to the IMF, a solution that changes the ex-
approved a solution that would change the Group's current expectations, reflected in the financial statements as at 31
December 2022, on: (i) the ability of the Government of Mozambique and public companies to repay their debts and
commitments assumed; and (ii) the development of the activity of its subsidiary Banco Internacional de Mo\u00e7ambique
(BIM).
As at 31 December 2022, considering the 66.7% indirect investment in BIM, the Group's interest in BIM's equity
amounted to Euros 347,559,000 (31 December 2021: Euros 372,708,000), with the exchange translation reserve
associated with this participation, accounted in Group's consolidated equity, in a negative amount of Euros 139,373,000
(31 December 2021: negative amount of Euros 162,561,000). BIM's contribution to consolidated net income for 2022,
attributable to the shareholders of the Bank, amounts to Euros\u00a0 70,707,000 (2021: Euros 63,729,000).
As at 31 December 2022, the subsidiary BIM's exposure to the State of Mozambique and to the Central Bank includes
public debt securities denominated in Metical classified as Financial assets measured at amortised cost - Debt
instruments in the gross amount of MZN 57,909,918,000 corresponding to Euros 849,306,000 (31 December 2021: MZN
72,710,220,000 corresponding to Euros 997,397,000) and Financial assets at fair value through other comprehensive
income in the gross amount of MZN 7,172,774,000 corresponding to Euros 105,196,000 (31 December 2021: MZN
4,359,808,000 corresponding to Euros 59,805,000).
Additionally, the Group has also registered as at 31 December 2022, in the balance Loans and advances to customers, a
direct gross exposure to the Mozambican State in the amount of MZN 19,081,523,000 corresponding to Euros
279,849,000 (31 December 2021: MZN 20,380,268,000 corresponding to Euros 279,567,000) and in the balance
Guarantees granted revocable and irrevocable commitments, an amount of MZN 4,818,871,000 corresponding to Euros
70,704,000 (31 December 2021: MZN 6,318,155,000 corresponding to Euros 86,904,000).\u00a0
Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37 are the
following:
1. In 2012, the Portuguese Competition Authority (\"PCA\") initiated an administrative proceeding relating to competition
restrictive practices (no. PRC 2012/9). On 6 March 2013, unannounced inspections were conducted in the premises of
Banco Comercial Portugu\u00eas, S.A. (\"BCP\" or \"Bank\") and other credit institutions, where documentation was seized to
investigate allegations of a commercially sensitive information exchange between Portuguese banks.
The administrative proceeding was subject to judicial secrecy by the PCA, as the publicity of the process would not be
compatible with the interests of the investigation and with the rights of the investigated companies. On 2 June 2015,
the Bank was notified of the PCA\u2019s statement of objections (\u201cSO\u201d) in connection with the administrative offence no.
2012/9, by which the Bank is accused of participating in a commercially sensitive information exchange between other
fourteen banks related to retail credit products, namely housing, consumer and small and medium enterprises credit
products.
The proceedings, including the deadline to submit a response to the SO, were suspended for several months between
2015 and 2017, following the appeals lodged by some defendants (including the Bank) before the Portuguese
Competition, Regulation and Supervision Court (\u201cCompetition Court\u201d) on procedural grounds (namely, on the right to
have access to confidential documents which were not used as evidence by the Authority \u2013 for several months, the PCA
denied the Defendant\u2019 right to have access to confidential documents not used as evidence). In the end of June 2017,
the suspension on the deadline to reply to the SO was lifted.
On 27 September 2017, BCP submitted its reply to the statement of objections. A non-confidential version of the Bank\u2019s
defense was sent to the PCA, at the latter\u2019s request, on 30 October 2017. The witnesses indicated by the Bank were
interrogated by the PCA in December 2017 (although without the presence of BCP\u2019s legal representatives).
In May 2018, the PCA refused the BCP\u2019s application for confidential treatment of some of the information in the Bank\u2019s
reply to the SO, having also imposed that the Bank protects the confidential information of the co-defendants
(providing a summary of the information). On 1 June 2018, the Bank filed an appeal with the Competition Court, which,
upholding the appeal, concluded that the PCA infringed on the right to a prior hearing. Complying with the judgment,
in November 2018, the PCA notified the Bank of its intention to deny the application for confidential treatment of some
of the information included in the Bank\u2019s defence; subsequently, in January 2019, it requested BCP to provide
summaries for the co-defendants\u2019 confidential information. The Bank filed an appeal before the Competition Court,
which ruled in favor of BCP, as it considered that the elaboration by the Bank of summaries for its co-defendants\u2019
confidential information an illegitimate burden.
In April 2019, at the PCA\u2019s request, BCP declared to be in favor of the re-examination of its witnesses, requested in its
defense and previously held. The witnesses were re-inquired on 16-17 April 2019 with the presence of the Bank\u2019s legal
representatives.
The PCA denied the request of BCP to be allowed to conduct cross-examination of the witnesses appointed by its co-
defendants. The Bank appealed to the Competition Court, which denied the appeal, through a decision which was latter
upheld by the Lisbon Court of Appeal. BCP then lodged an appeal before the Portuguese Constitutional Court for breach
of the constitutional right of defence. The Constitutional Court dismissed the appeal on 29 April 2021, on the grounds
that the requested cross-examination was not required by the Portuguese Constitution, at that stage of the
proceedings. On 12 August 2020, the Bank lodged a complaint before the European Court of Human Rights on this
matter.
On 2 July 2019, the Bank submitted its observations to the PCA\u2019s report on complementary evidence measures.
On 3 June 2019, BCP was notified of the partial dismissal of the complementary evidence measures it had requested in
its reply to the SO, which it judicially contested. By judgment of September 2019, the Competition Court declared the
nullity of the PCA\u2019s decision, for breach of the right of the parties to be heard on the PCA\u2019s draft decision. The Bank
appealed to the Lisbon Court of Appeal in what concerned the limitation by the Competition Court of the effects of the
nullity declaration of the PCA\u2019s decision. Although this appeal was ultimately admitted by the panel of judges of the
Lisbon Court of Appeal, it ends up being denied.
In order to give compliance to BCP\u2019s right to be heard, the PCA notified the BCP of its intention to reject the above-
mentioned complementary evidence measures. Following BCP\u2019s observations in November 2019, the PCA adopted its
final decision rejecting the measures, which was judicially contested by the BCP in December 2019. In March 2020, the
Competition Court rejected the appeal. This judgment was upheld by the Lisbon Court of Appeal in October 2020.
On 9 September 2019, the PCA adopted its final decision in this proceeding, fining the Bank in a Euros 60 million fine
for its alleged participation in an information exchange system with its competitors in the housing, consumer and SME
credit segments. The BCP considers that the Decision contains serious factual and legal errors, having, on 21 October
2019, filed an appeal before the Competition Court requesting the annulation of the Decision and the suspensory effect
of the appeal. On 8 May 2020, BCP\u2019s appeal was admitted. On 8 June 2020, the BCP submitted a request before the
Court, claiming that the rule according to which appeals do not have, in principle, suspensory effect violates the
Portuguese Constitution, submitting elements aimed at demonstrating considerable harm in the advance provisional
payment of the fine, and offering a guarantee in lieu (indicating the respective percentage of the fine to be offered as
a guarantee). On 14 December 2020, a hearing was held before the Competition Court, and a consensual solution was
reached between the PCA and the defendant banks, including BCP, as to the dosimetry (i.e., 50% of the amount of the
fine) and the forms of the guarantee to be provided, in order for the appeal of the PCA\u2019s decision to have suspensory
effect. On 21 December 2020, BCP submitted a bank guarantee issued by the BCP, which was accepted by the
Competition Court. On 1 March 2021, the Competition Court notified BCP that the guarantee had been presented in a
timely manner and in the agreed form, and, as a result, attributed suspensory effect to the appeal. By order of 20
March 2021, the Competition Court lifted the judicial secrecy and informed the appellants that the trial would, in
principle, start in September 2021.
On 9 July 2020, the BCP requested the Court to declare the nullity of the fining decision of the PCA for failure to assess
the economic and legal context, as determined by the recent case-law of the Court of Justice of the European Union.
The Competition Court clarified that this and other prior questions would not be assessed before the hearing phase.
On 13 January 2021, BCP was notified of an application submitted by \"Associa\u00e7\u00e3o Ius Omnibus \u2013 Nova Associa\u00e7\u00e3o de
Consumidores\" to the Competition Court asking it to have access to a non-confidential version of the file, based on the
need to assert the \u201crights to indemnification of the consumers whose rights and interests it represents, and the possible
exercise and proof of those rights in the context of an action for damages\u201d. On the same date, BCP was notified by the
Competition Court of its decision authorizing the news agency \"Lusa\" to access the file of the administrative phase of
the case. BCP appeal of this decision to the Appeal Court of Lisbon, on 25 January 2021 and opposed to the request of
\"Ius Omnibus\" on 2 February 2021.
On 20 March 2021, the Competition Court determined: (i) the lifting of the judicial secrecy; (ii) the forwarding to the
Public Prosecutor of the appeal of BCP against the decision of the Competition Court relating to \"Lusa\", for reply; (iii)
the provisional start date of the judgement hearing on September 2021, having requested suggestions by the co-
appellants for venues.
By decision of 9 April 2021 of the Competition Court, a preparatory hearing took place on 30 April 2021 for discussion of
issues precedent to the begging of the judgment hearings, in which the procedures relating to the treatment of
confidential information of the co-appellants in the appeals was defined, as well as the conditions relating to access to
file. The Competition Court also set forth preliminary dates for the judgement hearing and scheduled a preparatory
hearing for 7 July 2021.
On 28 June 2021, BCP was notified by the Competition Court to reply to the requests submitted by some of the co-
appellants and confirm that all confidential information had been duly eliminated from non-confidential versions
submitted by each co-appellant. The Competition Court also determined that the hearing of 7 July 2021 was cancelled
and its object would be transferred to the next hearing date (6 September 2021).
On 8 July 2021, BCP presented its reply to the notification of 28 June 2021, having also requested confirmation in
relation to the scheduling of the judgement hearing, namely confirmation of whether it was actually scheduled for 6
September 2021 the preparatory hearing and the start of the judgement hearing sessions.
Several representatives of the banks raised the question of the possible unconstitutionality of the seizure proceedings
of e-mail messages used as evidence in the PCA\u2019s decision, which objection appeal will now take place. This issue was
raised bearing in mind the recent Decision of the Constitutional Court no. 687/2021 on the administrative offence case
no. 225/15.4YUSTR-W. A petition on this matter was filed with the Court on 10 October 2021, requesting the Court to
take a position on the matter before the beginning of the trial. The Court issued an order rejecting the banks' request
to rule on those nullities raised by them, having refused to prohibit the use during the judgment of electronic messages
seized, allowing witnesses to be confronted with their content. The requesting banks lodged an appeal against this
order, which was admitted by the Lisbon Court of Appeal.
On 28 April 2022, TCRS (\"Tribunal da Concorr\u00eancia, Regula\u00e7\u00e3o e Supervis\u00e3o\") handed down a decision under the scope
of Proc. 225/15.4YUSTR-W, regarding the appeal to challenge the decision of the Portuguese Competition Authority of
September 2019 (PRC/2012/09), which imposed fines on a number of banking institutions for alleged violation of
competition rules in virtue of participating in a process of exchanging information on mortgage loans, consumer credit
and credit to SMEs.
In this extensive decision, TCRS lists the facts given as proven, bearing in mind the testimonial evidence produced and
the documents attached to the case file, both in the administrative phase and in the trial, however, at this stage, the
TCRS does not yet conclude by the legal framework of the facts as proven, nor, consequently, by the imposition of
fines, having the TCRS instead chosen to make the reference for a preliminary ruling to the Court of Justice of the
European Union (CJEU) in order to answer two preliminary questions that it sets out, requesting that this reference
follows further terms in the form of an accelerated procedure, taking into account the risk of prescription. It should be
noted that it is not up to the CJEU to adjudicate on the case, but only to interpret the rules of community law by
answering in abstract to the questions submitted to it by the referring court.
CJEU rejected TCRS's request for an accelerated procedure and for priority to be given in the assessment of this case,
hence CJEU's assessment must be given within the normal deadline for these prejudicial proceedings, after which the
judgment of this Court will then be concluded.
The Bank has been notified by the CJEU to, if it wishes, submit its written observations, and must do so by 2 September
2022.
The Bank forwarded its observations to the CJEU on 1 September 2022.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and Jos\u00e9
Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo Banco, S.A.
and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the defendant
banks and the financial system, without which they would have sold the pledged shares and paid their loans. If this is
not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to Funda\u00e7\u00e3o Jos\u00e9 Berardo
for damages caused by breach of contract, since the moment when they should have been sold in execution of the
pledge due to failure to verify coverage ratios until the moment\u00a0 when they were sold, that is, the difference between
the price at which the pledged shares would have been sold on the dates of coverage ratios default and the price at
which they were actually sold, plus interest and all other loan charges since those dates, in any case the global amount
of compensation not being less than Euros 800,000,000. In any case, the plaintiffs ask the defendant banks to be jointly
condemned to pay Jos\u00e9 Manuel Rodrigues Berardo compensation for moral damages, in the already calculated amount
of Euros 100,000,000 and also in the amount that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of Ministers,
published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9 Berardo, was
declared extinct.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
3. On 3 January 2018, Bank Millennium received decision of the Chairman of the Office for Protection of Competition
and Consumers (OPCC), in which the OPCC Chairman found infringement by Bank Millennium of the rights of consumers.
In the opinion of the OPCC Chairman the essence of the violation is that Bank Millennium informed consumers (it
regards 78 agreements) in responses to their complaints, that the court verdict stating the abusiveness of the provisions
of the loan agreement regarding exchange rates does not apply to them. According to the position of the OPCC
Chairman the abusiveness of contract\u2019s clauses determined by the court\u00a0 in the course of abstract control is
constitutive and effective for every contract from the beginning. As a result of the decision, Bank Millennium was
obliged to:
1) send information on the UOKiK\u2019s decision to the said 78 clients;
2) place the information on\u00a0 decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (Euros 4.42 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium appealed
against the judgment within the statutory deadline. The court presented the view that the judgment issued in the
course of the control of a contractual template (in the course of an abstract control), recognizing the provisions of the
template as abusive, determines the abusiveness of similar provisions in previously concluded contracts. Therefore, the
information provided to consumers was incorrect and misleading. As regards the penalty imposed by OPCC, the court
pointed out that the policy of imposing penalties by the Office had changed in the direction of tightening penalties and
that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the perspective
of today's case-law views on the importance of abstract control (it was not until January 2016 that the Supreme Court's
resolution supporting the view of the OPCC Chairman was published), the more penalties for these behaviours should
not be imposed using current policy. The above constitutes a significant argument against the validity of the judgment
and supports the appeal which Bank Millennium submitted to the Court of second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is positive.
Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC Chairman
recognized the practice of participating banks, including Bank Millennium, in an agreement aimed at jointly setting
interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of competition, and
by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2 million (Euros 2.61
million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection. Bank Millennium has created a provision in the amount equal to the imposed penalty.
4. On 22 September 2020, Bank Millennium received decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman) recognising clauses stipulating principles of currency exchange applied in
the so-called anti-spread annex as abusive and prohibited the use thereof.
Penalty was imposed upon Bank Millennium in the amount of PLN 10.5 million (Euros 2.24 million). Penalty amount
takes account of two mitigating circumstances: cooperation with the Office for Protection of Competition and
Consumers and discontinuation of the use of provisions in question.
Bank Millennium was also requested, after the decision becomes final and binding, to inform consumers, by registered
mail, to the effect that the said clauses were deemed to be abusive and therefore not binding upon them (without need
to obtain court\u2019s decision confirming this circumstance) and publish the decision of the case on Bank Millennium\u2019s
website.
In the decision justification delivered in writing the OPCC Chairman stated that FX rates determined by Bank Millennium
were determined at Bank Millennium\u2019s discretion (on the basis of a concept, not specified in any regulations, of average
inter-bank market rate). Moreover, client had no precise knowledge on where to look for said rates since provision
referred to Reuters, without precisely defining the relevant site.
Provisions relating to FX rates in Bank Millennium\u2019s tables were challenged since Bank Millennium failed to define when
and how many times a day these tables were prepared and published.
In justification of the decision, the OPCC Chairman also indicated that in the course of the proceeding, Bank Millennium
presented various proposed solutions, which the OPCC Chairman deemed to be insufficient.
The decision is not final and binding. Bank Millennium appealed against the said decision within statutory term.
On 31 March 2022, the first instance court revoked the entire decision of the Chairman of the OPCC. On 23 May 2022,
the Chairman of the OPCC filed an appeal. On 26 October 2022, the Court of Appeal changed the judgment of the court
of first instance and shared the position of the Chairman of the OPCC as to the abusiveness of the provisions regarding
the determination of exchange rates in the annexes concluded with foreign currency borrowers. On 21 November 2022,
the Court of Appeal, at the request of Bank Millennium, suspended the execution of the judgment until the end of the
cassation proceedings. Bank Millennium filled a cassation appeal to the Supreme Court.
5. As at 31 December 2022, the most important proceedings, in the group of the court cases where the Group\u2019s
companies are defendant, are following:
- Bank Millennium is a defendant in three court proceedings in which the subject of the dispute is the amount of the
interchange fee. In two of the abovementioned cases, Bank Millennium was sued jointly and severally with another
bank, and in one with another bank and card organizations. The total value of claims submitted in these cases is PLN
729.6 million (Euros 155.84 million). The proceedings with the highest value of the submitted claim are brought by PKN
Orlen SA, in which the plaintiff demands payment of PLN 635.7 million (Euros 135.79 million). The plaintiff in this
proceeding alleges that the banks acted under an agreement restricting competition on the acquiring services market
by jointly setting the level of the national interchange fee in the years 2006-2014. In the other two cases, the charges
are similar to those raised in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated
for the years 2008-2014. According to current estimates of the risk of losing a dispute in these matters, Bank Millennium
did not create a provision. In addition, we point out that Bank Millennium participates as a side intervener in four other
proceedings regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks
of acting as part of an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2008-2014.
- A lawsuit brought up by Europejska Fundacja Wsp\u00f3\u0142pracy Polsko-Belgijskiej/European Foundation for Polish-Belgian
Cooperation (EFWP-B) against Bank Millennium S.A., worth of the dispute PLN 521.9 million (Euros 111.48 million) with
statutory interest from 5 April 2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the
Regional Court in Warsaw; the suit\u00a0 was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis
for the claim is damage to their assets, due to the actions taken by Bank Millennium and consisting in the wrong
interpretation of the Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which
resulted in placing the loan on demand. In the case brought by EFWP-B, the plaintiff moved for securing the claim in
the amount of PLN 250.0 million (Euros 53.40 million). The petition was dismissed on 5 September 2016 with legal
validity by the Appellate Court. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with
the charges raised in the claim. Supporting the position of Bank Millennium, Bank Millennium\u2019s attorney submitted a
binding copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state
in the action brought by PCZ SA against Bank Millennium. At present, the Court of first instance is conducting evidence
proceedings.
As at 31 December 2022, the total value of the subjects of the other litigations in which the Group\u2019s companies\u00a0
appeared as defendant, stood at PLN 3,876.4 million (Euros 828.01 million) (excluding the class actions described below
and in note 57). In this group the most important category are cases related with FX loans mortgage portfolio and cases
related to forward transactions (option cases).
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors (454
borrowers party to 275 loan agreements) is represented by the Municipal Consumer Ombudsman in Olsztyn. The
plaintiffs demanded payment of the amount of PLN 3.5 million (Euros 0.75 million), claiming that the clauses of the
agreements, pertaining to the low down payment insurance, are unfair and thus not binding. Plaintiff extended the
group in the court letter filed on 4 April 2018, therefore the claims increased from PLN 3.5 million (Euros 0.75 million)
to over PLN 5 million (Euros 1.07 million).
Actual status:
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings and
submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The value of
the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (Euros 1,574,484.78).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff and
decided to take witness evidence in writing and called on the parties to submit questions to the witnesses. Bank
Millennium submitted a pleading with questions to witnesses in July 2020. Currently, the court is collecting written
testimony from witnesses. The date of the hearing has not been set at the moment.
As at 31 December 2022, there were also 218 individual court cases regarding LTV (loans-to-value) insurance (cases in
which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial Ombudsman, in
the lawsuit, demands that Bank Millennium and the Insurer (TU Europa) be ordered to discontinue performing unfair
market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its website, information on use of
unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts. Nonetheless, if
the practice is deemed to be abusive it may constitute grounds for future claims to be filed by individual clients.
The case is being examined by the court of first instance.
8. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to Euros 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -, filed
against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they acted
pursuant to a request made by the Bank for the making of the respective purchases, and also that the court orders the
cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due to
relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs and to
refund them the cost they incurred while complying with that mandate, namely, Euros 90,483,816.83 regarding Banco
Esp\u00edrito Santo, S.A. (BES) and Euros 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD), plus default
interests;
d) the amount of the lawsuit determined by the plaintiffs is Euros 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff company
in the amount of Euros 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report was submitted. There is a deadline for completing and concluding
the expert report, in its final version, since the Bank presented a complaint about various aspects of the expert's
report, in its first version.
9. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal applied a
resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the Decree-law no.
298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial transfer of
assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo Banco, S.A. (Novo
Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope of this process, the
Resolution Fund made a capital contribution to Novo Banco amounting to Euros 4,900 million, becoming, on that date,
the sole shareholder. Further, in accordance with information published on the Resolution Fund\u2019s website, the
Resolution Fund borrowed Euros 4,600 million, of which Euros 3,900 million were granted by the Portuguese State and
Euros 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities emerging from
the \u201ceventual negative effects of future decisions regarding the resolution process that may result in liabilities or
contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken, following
the publication of the report on the result of the independent evaluation, made to estimate the level of credit recovery
for each category of creditors under a hypothetical scenario of a normal insolvency process of BES on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would hypothetically
take if BES had gone into liquidation right before the application of the resolution measure, such creditors shall be
entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the total
acknowledged credits, including capital, remunerative and default interest amounts to Euros 5,056,814,588, of which
Euros 2,221,549,499 are common credits and Euros 2,835,265,089 are subordinated claims, and no guaranteed or
privileged claims exist. Both the total number of acknowledged creditors and the total value of the acknowledged
credits and their ranking will only be ultimately determined upon the definitive judicial judgment of the verification
and ranking of credits to be given in the liquidation proceedings.
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed and is
underway. According to note 20 of the Resolution Fund\u2019s annual report of 2021, \u201cLegal actions related to the
application of resolution measures have no legal precedents, which makes it impossible to use case law in its
evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026) The Resolution
Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and procedural
information available so far, considers that there is no evidence to cast doubt on their belief that the probability of
success is higher than the probability of failure\u201d.
According to note 22 of the Resolution Fund\u2019s annual report of 2021, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction. (...) Regarding litigation in the
Spanish jurisdiction, during the years 2018 to 2021, ten (decisions) have become final and unappealable condemning
Novo Banco, Spanish branch, as well as three sentences in relation to which due compensation has been requested
from the Resolution Fund\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco de
Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently signed
the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a total of Euros
1,000 million in Novo Banco, of which Euros 750 million at completion and Euros 250 million within a period of up to 3
years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco and the Resolution
Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the performance
of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
If these conditions are met, the Resolution Fund may be called upon to make a payment to Novo Banco for the lesser of
the accumulated losses in the covered assets and the amount necessary to restore the capital ratios at the agreed
levels. Any capital injections to be carried out pursuant to this contingent mechanism are limited to an absolute cap.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align incentives as
well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers no. 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new shareholder
of Euros 750 million, followed by a further capital increase of Euros 250 million by the end of 2017. Upon completion of
the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the purposes of the
resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding the
approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support measures by the
Resolution Fund and the Portuguese State that are part of the sale agreement associated with a total gross book value
of around Euros [10-20] billion(1) that revealed significant uncertainties regarding adequacy in provisioning(2):
(i)Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding costs,
realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a maximum of
Euros 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some additional
conditions(1)(2)(3);
(ii)underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount necessary
(but no more than Euros 400 million). The amount that can be reclaimed by the Resolution Fund under the CCA is
subject to the cap of Euros 3.89 billion(2);
(iii) in case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted by the
Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism (capital
backstop), up to Euros 1.6 billion, provided for in the commitments made by the Portuguese State to ensure the
viability of NB, exists\u201d.
According to Novo Banco\u2019s earnings presentation of December 2022, Novo Banco still has Euros 485 million under the
MCC in addition to the Euros 209 million included in the capital call for 2021. The mechanism is in place until December
2025, date that can be extended, under certain conditions, by one additional year.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has disclosed that
the European Commission intends to consider the restructuring process of Novo Banco as completed. The information
disclosed today confirms the successful restructuring of Novo Banco, resulting from the combined execution of the
restructuring plan agreed in 2017, under the sale transaction conducted by Banco de Portugal, and the sale
agreements, namely the CCA, under which the Resolution Fund transferred to Novo Banco 485 million euros, less than
the maximum amount set in the contract (3,890 million euros). The completion of the restructuring of Novo Banco, in
which the Resolution Fund maintains a 19.31% stake, is also another indicator that Novo Banco should not need to
request any further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that
still may occur regarding the amounts already requested by Novo Banco in relation to past years and that the Resolution
Fund considers that are not due. In the statement issued by Banco de Portugal on the same day, it is also disclosed that
\"The conclusion of the Novo Banco restructuring process also results in the end of the backstop mechanism, which
provided for the possibility, which was always considered remote, of the Portuguese State providing extraordinary
support to Novo Banco in extreme scenarios. This mechanism protected Novo Banco and the national financial system
from more adverse scenarios, which did not materialize. With the end of the backstop, the financial risk for the
Portuguese State is eliminated\".
According to the 2018 Resolution Fund\u2019s annual report, the Resolution Fund and Novo Banco have agreed that a
Verification Agent - an independent entity which is essentially responsible for clarifying any differences that may exist
between Novo Banco and the Resolution Fund regarding the set of calculations inherent to the CCA or regarding the
practical application of the principles stipulated in the contract - is in charge of confirming that the perimeter of the
mechanism is correct and that the balance sheet values of Novo Banco are being correctly reflected in the mechanism,
as well as verifying the underlying set of calculations, namely by confirming the correct calculation of losses and the
reference value of the assets. According to the 2021 Resolution Fund\u2019s annual report, the Resolution Fund follows the
work carried out by the Verification Agent, while specific analyses are being requested.
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or
Tier 1 SREP requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
In its 2021 annual report, the Resolution Fund states that \u201ceventual new requests regarding future periods, with
significant uncertainty regarding the relevant parameters for the calculation of eventual responsibilities, under the
terms of the CCA, are recorded as contingent liabilities\u201d.
The Resolution Fund disclosed on 17 June 2019 a set of clarifications related to the payment due in 2019 under the CCA
with Novo Banco, namely:
- For payments from the Resolution Fund to be made (limited to a maximum of Euros 3,890 million over the lifetime of
the mechanism), losses on the assets under the contingent mechanism should be incurred and the capital ratios of Novo
Banco should stand below the agreed reference thresholds;
- The payment to be made by the Resolution Fund corresponds to the lower of the accumulated losses on the assets
covered and the amount necessary to restore the capital ratios above the minimum reference threshold;
- The reference capital ratios are, in 2017, 2018 and 2019, linked to the regulatory requirements applicable to Novo
Banco (CET1 ratio of 11.25% and Tier 1 ratio of 12.75%), but, as from 2020, the reference ratio will correspond to a
CET1 ratio of 12%;
- The initial reference value of the portfolio comprising the CCA was, as of 30 June 2016, Euros 7,838 million (book
value of the associated assets, net of impairments);
- The value of the portfolio, as at 31 December 2021, amounted to Euros 1.8 billion (book value, net of impairments),
according to Novo Banco\u2019s First Half 2022 report.
According to a notice issued by the Resolution Fund on 4 June 2020, the \"Resolution Fund and Novo Banco have
initiated an arbitration procedure to clarify the treatment that should be given, under the CCA, of the effects of Novo
Banco\u2019s decision to waive the transitional regime it currently benefits from and which aims to reduce the impact of
the introduction of IFRS 9 on credit institutions' own funds. This issue falls within the scope of the implementation of
the CCA, which sets the maximum amount of payments to be made by the Resolution Fund at Euro 3,890 million. Thus,
even if the arbitration procedure were to have an unfavourable outcome for the Resolution Fund's claims, its effects
would fall under the maximum limit of Euros 3,890 million in accordance with the CCA. The above arbitral proceedings
therefore do not represent an additional risk compared to the ceiling of Euros 3,890 million\".
According to Resolution Fund\u2019s annual report of 2021 (Box 1), \"the award of the Arbitration Court, constituted under
the aegis of the International Chamber of Commerce, was known at the end of October 2021, and was favorable to the
Resolution Fund. The Arbitration Court considered that (...) the financial impact on Novo Banco's own funds could not
be covered by the CCM. The value of the dispute at the date of the award amounted to 169 million euros, an amount
that the Resolution Fund would have had to pay to Novo Banco if the Arbitration Court's award had not been
favorable\".
Additionally, regarding the intervention of the Resolution Fund concerning the transitional regime of the
implementation of the dynamic component of IFRS 9, Novo Banco estimates a positive impact on its own funds in the
amount of Euros 171 million (which implies a reduction in the capital requirements that Novo Banco intended to pass on
to the CCM in the amount of Euros 161.6 million). Accordingly, the Resolution Fund initiated a second arbitration
proceeding, also under the aegis of the International Chamber of Commerce, with a view to settling the difference
between the parties. This process is in progress, and it is estimated that an award will be rendered during 2023.
According to a statement by the Resolution Fund on 3 September 2020, following the payment made in May 2019 by the
Resolution Fund to Novo Banco in compliance with the CCA, a special audit determined by the Government was carried
out. Information was presented by the independent entity that carried out the special audit, showing that Novo Banco
has been operating with a strong influence of the vast legacy of non-productive assets, originated in BES, which
resulted in impairment charges and provisions, but have also contributed to rendering Novo Banco\u2019s internal procedures
more robust. Regarding the exercise of the powers of the Resolution Fund under the CCA, the audit results reflect the
adequacy of the principles and the adopted criteria.
According to Resolution Fund\u2019s annual report of 2021, the procedure relating to the payment to Novo Banco regarding
2020 accounts has been concluded, concluding that a payment of Euros 112 million was due to Novo Banco from the
Resolution Fund which had remained pending further verification. Therefore, that amount was paid to Novo Banco, in
December 2021, after the conclusion of the supplementary analysis promoted by the Resolution Fund. This amount,
according to a statement issued by the Resolution Fund on 23 December 2021, was already provisioned, included in the
total amount of the provision (Euros 429,012,629).
According to Resolution Fund\u2019s annual report of 2021, Novo Banco submitted to the International Chamber of
Commerce a request for arbitration to have recognized the right to receive an aggregate amount of Euros 165,441.9
thousand (divestment of Novo Banco's activity in Spain in the amount of Euros 147,441.9 thousand and valuation
differences regarding a set of assets held by Novo Banco in the amount of Euros 18,000 thousand) which the Resolution
Fund considered, and considers, not to merit the coverage of the CCM.
According to Novo Banco\u2019s First Half 2022 report (note 30), Novo Banco adhered to the Special Regime applicable to
Deferred Tax Assets under Law No. 61/2014, of 26 August, according to which, the deferred tax assets recorded until 31
December 2015 can be converted into tax credits when the taxable entity reports an annual net loss, in accordance to
the proportion of the amount of the said net loss to total equity at the individual company level, A special reserve was
established with an amount identical to the tax credit approved, increased by 10%. The conversion rights are securities
that entitle the State to require Novo Banco to increase its share capital by incorporating the amount of the special
reserve and consequently issuing and delivering free of charge ordinary shares. The shareholders have the right to
acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2021 annual report, under the terms of the sale of Novo Banco, the 75% of the share
capital of Novo Banco held by Nani Holdings is not affected by the dilution associated with the Special Regime
applicable to deferred tax assets (REIAD).
According to Resolution Fund\u2019s annual report of 2021, on 17 December 2021, Novo Banco, carried out a capital increase
in the amount of Euros 154,907.3 thousand, through the conversion of the rights that had been attributed to the State
due to the conversion of the deferred tax assets of Novo Banco, into tax credits, with reference to the 2015 tax period,
under the REIAD. As of that date, the State became a shareholder of Novo Banco, having been attributed a participation
corresponding to 1.56% of the share capital. As a result, the participation of the Resolution Fund was diluted from 25%
to 23.44%.
According to Novo Banco\u2019s announcement of 4 November 2022, the share capital increase arising from the conversion of
conversion rights relating to 2016 and 2017 fiscal years issued under the REAID increased the Portuguese State
shareholding to 5.69% and Lone Star kept the 75% share capital of Novo Banco. Only the participation of the Resolution
Fund will be diluted, concomitantly.
Also, according to the Resolution Fund\u2019s 2021 annual report, it is estimated that the aggregate effect of the application
of the REAID will result in the reduction of the participation of the Resolution Fund to 9.05%.
On 3 May 2021, following the request of the Portuguese parliament in October 2020 to review the operations and
management of Novo Banco that led to the need to transfer funds from the Resolution Fund to Novo Banco, the
Resolution Fund announced that the audit report conducted by Tribunal de Contas (\u201cCourt of Auditors\u201d) was released.
The Court of Auditors concluded that the public financing of Novo Banco through the CCA contributed to the stability of
the financial system, particularly as it avoided the bank\u2019s liquidation and reduced systemic risk. According to the
Resolution Fund, the audit does not identify any impediment to the fulfilment of commitments and contracts arising
from BES\u2019s resolution process, initiated in August 2014.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to fail\u201d
and started an urgent resolution process of the institution through the partial or total sale of its activity, which was
completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and obligations of
Banif, formed by the assets, liabilities, off-balance sheet items and assets under management.
The largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of Euros 746 million. The Resolution Fund provided a
guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of which Euros 489
million were provided by the Resolution Fund, which was funded by a loan granted by the State.
According to Oitante's press release on 12 January 2022, \"during 2021, it repaid Euros 160.5 million related to its bond
loan of Euros 746 million, contracted when it was created on 20 December 2015 due to the resolution of Banif\". On 4
July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds issued in
connection with the resolution of BANIF. Oitante's debt, which initially amounted to Euros 746 million, was thus fully
repaid. With the early repayment of the debt, the Resolution Fund's responsibility as guarantor also ceases, as well as
the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the non-
acknowledged creditors. According to the Resolution Fund\u2019s 2021 annual report, the Resolution Fund holds a claim on
Banif of Euros 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF. Under the
judicial liquidation process of Banif, which was initiated following the resolution, the independent evaluator estimates
that the level of recovery of the financial support made available by the Resolution Fund, as having a higher ranking at
the end of the liquidation, should be 7.6%.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal dismissed a
lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de Portugal. In its
decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and assumed other
responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2021, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (Euros 3,900 million); (ii) to finance the absorption of Banif's losses (Euros 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (Euros 430 million plus Euros 850 million of additional funding requested in 2019 and Euros 850
million made available in 2020);
- Other funding granted:
\u2022in 2014 by the institutions participating in the Resolution Fund in the amount of Euros 700 million, in which the
Bank participates, within the scope of BES resolution measure;
\u2022in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up to a
maximum of EUR 429 million;
- Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of Euros 400
million. This underwriting did not take place as the instruments were placed with third party investors as disclosed by
Novo Banco on 29 July 2018;
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a loss
greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralized by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, totally reimbursed, as described above.
- CCA allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions related to the
aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star up to Euros 3.89
billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1 below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the SREP
total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
According to Resolution Fund\u2019s annual report of 2021, contingent liabilities from the CCA are limited to a maximum
aggregate amount of Euros 3,890 million and that the aggregate amount of this contingent liability, which corresponds
to the difference between that maximum amount and the amounts already paid by the Resolution Fund, amounts to
Euros 485 million.
The expectation of the Resolution Fund is that, except for what may eventually result from the pending arbitration
disputes with Novo Banco, no further payments will occur under the CCA. On the other hand, the value of payments
already made may be compensated, under the terms of the contracts, by the eventual recovery of credits that may
occur, to which the value of the shareholding of the Resolution Fund in Novo Banco must be added.
According to note 20 of the Resolution Fund\u2019s 2021 annual report, the Resolution Fund considers that, to date, there
are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the Euros 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution Fund, the
extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet its obligations
through its regular revenues, regardless of the contingencies to which the Resolution Fund is exposed. On the same day,
the Office of the Minister of Finance also announced that increases in the liabilities arising from the materialization of
future contingencies will determine the maturity adjustment of State and bank loans to the Resolution Fund, required
from to maintain the contributory effort required from the banking sector at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco Esp\u00edrito
Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to Euros 4,953
million, of which Euros 4,253 million were granted by the Portuguese State and Euros 700 million were granted by a
group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on the
use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and financial
balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on regular
revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and released on 12
July 2022, \"the repayment of the Euros 2,130 million loans granted by the Portuguese State to the Resolution Fund will
not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or in 2059 (with the use of
the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid in 2062\u201d.
According to a statement issued by the Resolution Fund on 31 December 2021, the Euros 700 million loan to the
Resolution Fund was provided by seven credit institutions (Caixa Geral de Dep\u00f3sitos, Banco Comercial Portugu\u00eas, Banco
BPI, Banco Santander Totta, Caixa Econ\u00f3mica, Montepio Geral, Banco BIC Portugu\u00eas and Caixa Central de Cr\u00e9dito
Agr\u00edcola M\u00fatuo).
On 2 October 2017, by Resolution no. 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to make
available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary, to satisfy
any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-mentioned
resolution further set out that the framework agreement should be subject to a time period that is consistent with the
undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to satisfy said obligations in
due time.
On 31 December 2021, the Resolution Fund's own resources had a negative equity of Euros 7,207.6 million, as opposed
to Euros 7,314.7 million at the end of 2020, according to the latest 2021 annual report of the Resolution Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives proceeds
from the initial and regular contributions from the participating institutions (including the Bank) and from the
contribution over the banking sector (created under Law no. 55-A/2010). It is also provided for the possibility of the
member of the Government responsible for the area of Finance to determine, by ordinance that the participating
institutions make special contributions, in the situations provided for in the applicable legislation, particularly if the
Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law no. 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying, since
2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the occurrence of
the event which creates the obligation to pay the contribution, i.e. on the last day of April of each year, as stipulated
in Article 9 of the referred Decree-Law no. 24/2013, of 19 February, thus the Bank is recognising as an expense the
contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law no. 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 19/2022, published on 15 December 2022, set the base rate for 2023 for the
determination of periodic contributions to the Resolution Fund at 0.029% (0.057% in 2022).
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is not
expected that the Resolution Fund will propose the setting up of a special contribution to finance the resolution
measure applied to BES. Therefore, the potential collection of a special contribution appears to be unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in the
amount of Euros 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to partially
cover for the disbursements made by the RF in respect of resolution measures prior to the date of application of this
Agreement. This amount will have to be reinstated over a period of 8 years (started in 2016) through the periodic
contributions to the SRF. The Single Resolution Fund does not cover undergoing situations with the National Resolution
Fund as at 31 December 2015. The total amount of the contribution attributable to the Group in the financial year of
2022 was Euros 30,400 thousand, of which the Group delivered Euros 25,847 thousand and the remaining was
constituted as irrevocable payment commitment.
During the financial year of 2022, the Group made regular contributions to the Portuguese Resolution Fund in the
amount of Euros 18,668 thousand. The amount related to the contribution on the banking sector in Portugal, registered
in the financial year of 2022, was Euros 43,484 thousand. These contributions were recognized as a cost in the financial
year of 2022, in accordance with IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, to assess the effects on the Resolution Fund due to: (i) the sale of the shareholding in
Novo Banco in accordance with the communication of Banco de Portugal dated 18 October 2017 and the information
provided by the European Commission on this subject under the terms described above, including the effects of the
application of the Contingent Capital Agreement and the Special Regime applicable to Deferred Tax Assets; (ii) the
application of the principle that no creditor of the credit institution under resolution may take on a loss greater than
the one it would take if that institution did not go into liquidation; (iii) additional liabilities or contingencies for Novo
Banco which need to be neutralized by the Resolution Fund; and, (iv) legal proceedings against the Resolution Fund.
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order no. 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a proposal
with respect to the determination of amounts, time limits, payment methods, and any other terms related to the
special contributions to be made by the institutions participating in the Resolution Fund. According to public
communications from both the Resolution Fund and from the Government, there is no indication that any such special
contributions are foreseen.
According to the Resolution Fund\u2019s 2021 annual report, under note 8, \"the Resolution Fund is not obliged to present
positive equity. In case of insufficient resources, the Resolution Fund may receive special contributions, as determined
by the member of the Government responsible for finance, in accordance with article 153-I of the Banking Act,
although no such contributions are expected, in particular after a review of the financing conditions of the Resolution
Fund\", as described in the 2016 Annual Report. The Resolution Fund may also, exceptionally, obtain financial support
from the State, namely through loans or guarantees, as set out in article 153-J of the same regime.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the General
Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding its approval
of the CCA of Novo Banco.
According to Resolution no. 63-A/2021 of 27 May 2021 of the Council of Ministers, a number of national financial
institutions offered to finance the Resolution Fund, under conditions considered as appropriate by it, increasing up to
Euros 475 million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund. The funding costs of the Resolution Fund (from the State and from banks) will continue to be
exclusively borne by periodic revenues, corresponding to the contributions paid by the banking sector. The payment
obligations arising from this loan benefit from a pari passu treatment with the payment obligations of the loans entered
into with the Portuguese State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on
28 August 2014.
According to the Resolution Fund\u2019s 2021 annual report, the payment to Novo Banco was fully funded with resources
from a loan from seven domestic credit institutions, including BCP, to finance payments that are due under the
aforementioned contingent capitalization mechanism, up to a maximum amount of Euros 475 million. Of this amount,
the Resolution Fund used Euros 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period between the
contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be reviewed on 31
December 2026 and, after that, every five-years.
The budgetary amendment necessary to make the payment by the Resolution Fund was authorised by Order of the
Minister of State and Finance dated 31 May 2021.
10. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution adopted
by Bank of Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation adopted by
the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent capitalization
agreement under which the Resolution Fund commits to inject capital in Novo Banco up to Euros 3,9 billion, under
determined circumstances. In the proceedings, the claimants request the declaration of nullity or annulment of those
acts.
The proceedings were filed based on the information contained in the Communication from Bank of Portugal dated 31
March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September 2017. Bank
of Portugal and the Resolution Fund presented their arguments and, only very recently, Nani Holdings SGPS, S.A. did
the same since, by delay of the court, this company was only very recently notified to act as a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Bank of Portugal cannot be challenged and (iii) the material incompetence of the
court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an opponent
party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the opponent
party. After the presentation of the arguments, Bank of Portugal attached to the proceedings what it called an
evidence process (allegedly in compliance with the law) but most of the documents delivered were truncated in such a
way that neither the court nor the claimants are able to obtain adequate knowledge thereof. That issue was already
raised in the proceedings (requesting the court to order Bank of Portugal to deliver a true evidence process) but no
decision thereon has been made yet.
Currently, the proceedings are prepared for confirmation of the decision accepting the formalities of the right of action
(with the making of a decision on the specific objections invoked). In case the judge considers that Novo Banco is an
opponent party, the judge must start by issuing a pre-confirmation in order to request the claimants to identify it.
Afterwards, that Bank will be notified to present its opposition arguments.
The case was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal opinions to
the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
11. Following the restructuring process agreed with the Directorate-General for Competition (DGComp) and the
Portuguese State, Group Banco Comercial Portugu\u00eas implemented a process of salary adjustment for a temporary
period. Additionally, it was agreed between the Bank and the Unions that, in the years after the State intervention and
if there are distributable profits, the Board of Directors and the Executive Committee would submit for approval of the
Shareholders\u2019 General Meeting a proposal of distribution of profits to the employees, which allows the distribution of an
accumulated total global amount at least equal to the total amount that was not received over the temporary term of
the salary adjustment, as described in the clause no. 151-E of BCP\u2019s Collective Labour Agreement, effective between
2014 and 2017.
At the General Meeting of 4 May 2022, following the proposal submitted by the Board of Directors, the application of
profits relating to the financial year of 2021 was approved, which included an extraordinary distribution to each
employee up to Euros 5,692,000, and the concrete determination of the amount to be attributed to each employee
must be fixed by the Executive Committee to employees who, having not already been fully compensated with the
results distributed in 2019 and 2020, remain in office on the date of payment of the remuneration corresponding to
June 2022.
12. The Bank was subject to tax inspections for the years up to 2019. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the case of
indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of determining
the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/corrections made by the tax
administration were the object of contestation by administrative and/or judicial means.
The Bank recorded provisions or deferred tax liabilities at the amount considered sufficient to offset the tax or tax loss
carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by the tax administration.
Provisions for legal risk related to foreign currency-indexed mortgage loans in
Bank Millennium (Poland)
1. Court claims and current provisions for legal risk
On 31 December 2022, Bank Millennium had 16,008 loan agreements and additionally 1,272 loan agreements from
former Euro Bank under individual ongoing litigations (excluding claims submitted by the bank against clients i.e. debt
collection cases) concerning the use of indexation clauses of FX mortgage loans submitted to the courts (78% loans
agreements before the court of first instance and 22% loans agreements before the court of second instance) with the
total value of claims filed against the Bank Millennium by the plaintiffs amounting to PLN 2,758.4 million (Euros 589.20
million) and CHF 201.9 million (Euros 204.53 million) [(Bank Millennium portfolio: PLN 2,536 million (Euros 541.70
million) and CHF 197.3 million (Euros 199.87 million) and former Euro Bank portfolio: PLN 222.5 million (Euros 47.53
million) and CHF 4.6 million (Euros 4.66 million)].
The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the
contract and payment for reimbursement of paid principal and interest instalments as undue performance, due to the
alleged abusive nature of indexation clauses, or maintenance of the loan agreement in PLN and with interest rate
indexed to CHF Libor.
In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to determine
Bank Millennium's liability towards the group members based on unjust enrichment (undue benefit) ground in
connection with the FX mortgage loans. A judgment in these proceedings will not directly grant a right to any
compensation amounts to the group members that have initiated this class action. The number of credit agreements
covered by these proceedings is 3,273. On 24 May 2022, the court issued a judgment on the merits, dismissing the claim
in full. Both parties requested a written justification of the judgment. On 13 December 2022, the claimant filed on
appeal against the judgment of 24 May 2022 and the Bank Millennium also filed its response to the that appeal.
The aggressive advertising campaign to encourage litigation against the financial sector affected the number of court
disputes. Until the end of 2019, 1,982 individual claims were filed against Bank Millennium (in addition, 236 against
former Euro Bank), in 2020 the number increased by 3,006 (265), in 2021 the number increased by 6,153 (422), while in
2022 the number increased by 5,750 (408).
Based on ZBP (the Polish Banking Association) data gathered from all banks having FX mortgage loans, vast majority of
disputes were finally resolved in favour of banks until 2019 year. However, after the Court of Justice of the European
Union (CJEU) judgment issued on 3 October 2019 (Case C-260/18) the proportion has adversely changed and vast
majority of court cases have been lost by banks. As far as Bank Millennium itself is concerned, from 2015 and until the
end of 2022, 1,173 cases were finally resolved (1,111 in claims submitted by clients against Bank Millennium and 62 in
claims submitted by Bank Millennium against clients i.e. debt collection cases). out of which 354 were settlements, 46
were remissions, 53 rulings were favorable for Bank Millennium and 720 were unfavorable, including both invalidation
of loan agreements as well as conversions into PLN+LIBOR. Bank Millennium files appeals against negative judgements
of the courts of first instance as well as submits cassation appeals to the Supreme Court against unfavourable for Bank
Millennium legally binding verdicts. Currently, the statistics of first and second instance court decisions are much more
unfavourable and its number is also increasing.
The outstanding gross balance of the loan agreements under individual court cases and class action against Bank
Millennium on 31 December 2022 was PLN 5,576 million (Euros 1,191.05 million) [of which the outstanding amount of
the loan agreements under the class action proceeding was PLN 897 million (Euros 191.6 million)].
If all Bank Millennium\u2019s originated loan agreements currently under individual and class action court proceedings would
be declared invalid without proper compensation for the use of capital, the pre-tax cost could reach PLN 5,499 million
(Euros 1,174.6 million). Overall losses may be higher or lower depending on the final court decision in this regard.
During 2022, Bank Millennium created a PLN 1,844 million provisions (Euros 393.88 million) and PLN 173 million (Euros
36.95 million) for former Euro Bank originated portfolio. The balance sheet value of provisions for the Bank Millennium
portfolio at the end of December 2022 was at the level of PLN 4,986 million (Euros 1,065.02 million), and PLN 409
million (Euros 87.36 million) for former Euro Bank originated portfolio.
The methodology developed by Bank Millennium for calculating provisions for legal risk involved with indexed loans is
based on the following main parameters:
(1) the number of current cases (including class actions) and potential future lawsuits that arise within a specified
(three-year) time horizon;
(2) the amount of Bank Millennium's potential loss in the event of a specific court judgment;
(3) the probability of obtaining a specific court judgment calculated on the basis of statistics of decisions of the
banking sector in Poland and legal opinions obtained;
(4) in the case of the scenario of cancellation of the loan agreement, the element taken into account, with a view to
legal assessments, is the calculation of Bank Millennium's loss, taking into account the assignment of a minimum
probability of obtaining remuneration for the use of capital made available;
(5) estimates involved with amicable settlements with clients, concluded in court or out of court:
a.negotiations are conducted on a case-by-case basis and can be stopped at any time by Bank Millennium
b.as the negotiations efforts have already been material in the past, the probability of success may be lower in
the future and at the same time, gradually most of the client base has had contact with Bank Millennium
regarding potential negotiation of the conversion of the loans to PLN, so Bank Millennium is taking a
conservative approach when calculating the potential future impact for the time being.
Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Societe Generale.
Bank Millennium analyzed the sensitivity of the methodology for calculating provisions, for which a change in the
parameters would affect the value of the estimated loss to the legal risk of litigation:
Parameter
Scenario
Impact on loss due to legal risk related to the
portfolio of mortgage loans in convertible
currencies
Change in the number of lawsuits
Additionally, 1 p.p. of active clients file a
lawsuit against Bank Millennium
PLN 35 million (Euros 7.48 million)
Change in the probability of winning
a case
The probability of Bank Millennium winning
a case is lower by 1 p.p
PLN 41 million (Euros 8.76 million)
Change in estimated losses for each
variant of the judgment
Increase in losses for each variant of the
judgment by 1 p.p
PLN 40 million (Euros 8.54 million)
Bank Millennium is open to negotiate case by case favourable conditions for early repayment or conversion of loans to
PLN. As a result of these negotiations and other natural drivers, the number of active FX mortgage loans decreased by
8,449 in 2021 and 7,943 in 2022. As of end 2022, Bank Millennium had 38,011 active FX mortgage loans. Cost incurred in
conjunctions with these negotiations totalled PLN 364.5 million (Euros 77.86 million) in 2021 and PLN 515.2 million
(Euros 110.05 million) in 2022 and is presented mainly in \u2018Foreign exchange gains/(losses)\u2019 in the income statement,
and in 2022 also in 'Results on modification'.
Finally, it should also be mentioned, that Bank Millennium, as at 31 December 2022, had to maintain additional own
funds for the coverage of additional capital requirements related to FX mortgage portfolio risks (Pillar II FX buffer) in
the amount of 1.95 p.p. (1.94 p.p. at the Group level), part of which is allocated to operational/legal risk.
CJEU and Supreme Court rulings relevant to risk assessment
On 3 October 2019, the Court of Justice of the European Union ('the CJEU') issued the judgment in Case C-260/18 in
connection with the preliminary questions formulated by the District Court of Warsaw in the case against Raiffeisen
Bank International AG. The judgment of the CJEU, as regards the interpretation of European Union law made therein, is
binding on domestic courts. The judgment in question interpreted Article 6 of Directive 93/13/EEC of 5 April 1993 on
unfair terms in consumer contracts establishing that the said provision must be interpreted (i) as not precluding a
national court, after finding that certain terms of a loan agreement indexed to a foreign currency and subject to an
interest rate directly linked to the interbank rate of the currency concerned are unfair, from taking the view, in
accordance with its domestic law, that that contract cannot continue in existence without those terms because the
effect of their removal would be to alter the nature of the main subject matter of the contract; (ii) first, the
consequences for the consumer of a contract being annulled in its entirety, must be assessed in the light of the existing
or foreseeable circumstances at the time when the dispute arose, and that, second, for the purposes of that
assessment, the wishes expressed by the consumer in that regard are the decisive factor; (iii)\u00a0 as precluding gaps in a
contract caused by the removal of the unfair terms contained in that contract from being filled solely on the basis of
national provisions of a general nature which provide that the effects expressed in a legal transaction are to be
supplemented, inter alia, by the effects arising from the principle of equity or from established customs, which are
neither supplementary provisions nor provisions applicable where the parties to the contract so agree; (iv)\u00a0 as
precluding unfair terms contained in a contract from being upheld where their removal would entail that contract being
annulled and the court takes the view that that annulment would give rise to unfavorable effects for the consumer, if
the latter has not consented to them being upheld.
The CJEU judgment concerns only the situation where the national court has previously found the contract term to be
abusive. It is the exclusive competence of the national courts to assess, in the course of judicial proceedings, whether a
particular contract term can be regarded as abusive in the circumstances of the case.
On 29 April 2021, the CJEU issued the judgement in the case C-19/20 in connection with the preliminary questions
formulated by the District Court in Gda\u0144sk in the case against of ex-BPH S.A., CJEU said that the Council Directive
93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as meaning that (i) it is for the
national court to find that a term in a contract concluded between a seller or supplier and a consumer is unfair, even if
it has been contractually amended by those parties. Such a finding leads to the restoration of the situation that the
consumer would have been in in the absence of the term found to be unfair, except where the consumer, by means of
amendment of the unfair term, has waived such restoration by free and informed consent, which it is for the national
court to ascertain. However, it does not follow from that provision that a finding that the original term is unfair would,
in principle, lead to annulment of the contract, since the amendment of that term made it possible to restore the
balance between the obligations and rights of those parties arising under the contract and to remove the defect which
vitiated it; (ii) they do not preclude the national court from removing only the unfair element of a term in a contract
concluded between a seller or supplier and a consumer where the deterrent objective pursued by that directive is
ensured by national legislative provisions governing the use of that term, provided that that element consists of a
separate contractual obligation, capable of being subject to an individual examination of its unfair nature, and those
provisions preclude the referring court from removing only the unfair element of a term in a contract concluded
between a seller or supplier and a consumer where such removal would amount to revising the content of that term by
altering its substance, which it is for that court to determine; (iii) the consequences of a judicial finding that a term if
a contract concluded between a seller or supplier and a consumer is unfair are covered by national law and the
question of continuity of the contract should be assessed by the national court of its own motion in accordance with an
objective approach on the basis of those provisions;(iv) it is for the national court, finding that a term in a contract
concluded between a seller or supplier and a consumer, to inform the consumer, in the context of the national
procedural rules after both parties have been heard, of the legal consequences entailed by annulment of the contract,
irrespective of whether the consumer is represented by a professional representative.
On 18 November 2021, the Court of Justice of the European Union (CJEU) issued a judgment in case C-212/20 in
connection with questions submitted by the District Court for Warsaw Wola, in Warsaw, in the case against Raiffeisen
Bank International AG. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer
contracts must be interpreted (i) as meaning that the content of a clause of a loan agreement concluded between a
seller or supplier and a consumer that sets the buying and selling prices of a foreign currency to which the loan is
indexed must enable a consumer who is reasonably well informed and reasonably observant and circumspect to
understand, on the basis of clear and intelligible criteria, the way in which the foreign currency exchange rate used to
calculate the amount of the repayment instalments is set, in order that that consumer is able to determine himself or
herself, at any time, the exchange rate applied by the seller or supplier; (ii) as precluding the national court, which has
found that a term of a contract concluded between a seller or supplier and a consumer is unfair, within the meaning of
Article 3(1) of that directive, from interpreting that term in order to remedy its unfairness, even if that interpretation
would correspond to the common intention of the parties to that contract.
On 10 June 2021, the Court of Justice of the European Union (CJEU) issued an order in case C-198/20 in connection
with questions submitted by the District Court for Warsaw Wola in Warsaw in the case against Santander Bank Polska
SA. The CJEU stated that the protection provided for in Council Directive 93/13/EEC is granted to all consumers, not
just those who can be considered to be 'duly informed and reasonably observant and circumspect average consumers'.
On 8 September 2022, the Court of Justice of the European Union (CJEU) issued a judgment in joined cases C-80/21,
C-81/21, C-82/21 in connection with questions submitted by the District Court for Warsaw \u015ar\u00f3dmie\u015bcie in Warsaw in
cases against Deutsche Bank SA and mBank SA. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on
unfair terms in consumer contracts must be interpreted (i) as precluding national case-law according to which the
national court may declare unfair not the entire term of a contract concluded between a consumer and a seller or
supplier, but only those parts of it which are unfair, so that the term remains partially effective after the removal of
those parts, where such removal would be tantamount to revising the content of the term by affecting its substance,
which is a matter for the national court to determine; (ii) as precluding national case-law according to which the
national court may, after finding that an unfair term contained in a contract concluded between a consumer and a
seller or supplier is void and does not result in the annulment of that contract as a whole, replace that term with a
supplementary provision of national law; (iii) as precluding national case-law according to which the national court
may, after finding that an unfair term contained in a contract concluded between a consumer and a seller or supplier is
void and that the contract as a whole is void, replace the annulled term either by interpreting the parties\u2019 wishes in
order to avoid the annulment of the contract, or by applying to the annulled unfair term a supplementary provision of
national law, even though the consumer has been informed of the consequences of the annulment of that contract and
has accepted them; (iv) as precluding national case-law according to which the 10\u2011year limitation period for a
consumer\u2019s action for the restitution of sums unduly paid to a seller or supplier in performance of an unfair term
contained in a credit agreement with a duration of 30 years begins to run on the date of each performance by the
consumer, even though the consumer was not in a position, at that date, to assess the unfairness of the contractual
term himself or herself or was not aware of the unfairness of the term, and regardless of the fact that the contract had
a repayment period, in this case 30 years, which is much longer than the statutory limitation period of 10 years.
On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the
meaning of legal principle has been granted, stating that:
1. An abusive contractual clause (art. 3851 \u00a7 1 of the Polish Civil Code), by force of the law itself, is ineffective to the
benefit of the consumer who may consequently give conscious and free consent to this clause and thus restore its
effectiveness retroactively.
2. If, without the ineffective clause, the loan agreement cannot be binding, the consumer and the lender shall be
entitle for separate claims for return of cash benefits made to the other part during the term of this agreement (art.
410 \u00a7 1 in relation to art. 405 of the Polish Civil Code). The lender may demand return of the performance from the
moment the loan agreement becomes definitively ineffective.
On 28 April 2022, the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with
consumers, the provision of Article 358\u00ba1 of the Polish Civil Code is a special provision to Article 353\u00ba1 of the Civil Code,
which means that if the prerequisites for the application of both provisions exist, the court should apply the special
provision and declare the contractual provision definitively ineffective, rather than invalid. This decision of the
Supreme Court should be perceived as significantly limiting the risk of Bank Millennium's claims for return of capital
being time-barred.
In this context, taking into consideration the recent negative evolution in the court verdicts regarding FX mortgage
loans, and if such trend continues, Bank Millennium will have to regularly review and may need to continue to increase
the balance of provisions allocated to court litigations.
It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further examined
by the national courts within the framework of disputes considered which would possibly result in the emergence of
further interpretations, which are relevant for the assessment of the risks associated with subject matter proceedings.
This circumstance indicates the need for constant analysis of these matters. Further request for clarification and ruling
addressed to the European Court of Justice and Polish Supreme Court have already been filed and may still be filed
with potential impact on the outcome of the court cases.
2. Events that may impact foreign currency-indexed mortgage loans legal risk and related
provision
On 29 January 2021 a set of questions addressed by the First President of the Polish Supreme Court to the full Civil
Chamber of the Supreme Court was published. This may have important consequences in terms of clarifications of
relevant aspects of the court rulings and their consequences. The Civil Chamber of the Supreme Court has been
requested for answering the questions concerning key matters related to FX mortgage agreements: (i) is it possible to
replace - with a legal provisions or according\u00a0 commons practices - the abusive provisions of an agreement which refer
to FX exchange rate determination; moreover, (ii) in case of impossibility of determining the exchange rate of a foreign
currency in the indexed/denominated credit agreement - is it possible to keep the agreement still in force in its
remaining scope; as well as (iii) if in case of invalidity of the CHF credit there would be applicable the theory of
balance (i.e. does arise a single claim which is equal to the difference between value of claims of bank and the
customer) or the theory of two conditions (separate claims for the bank and for the client that should be dealt with
separately). The Polish Supreme Court has also been requested for answering the question on (iv) from which point in
time there shall be starting the limitation period in case of bank's claim for repayment of amounts made available as a
loan and (v) whether banks and consumers may receive remuneration for using their pecuniary means by another party.
On 11 May 2021, the Civil Chamber of the Polish Supreme Court requested opinions on Swiss franc mortgage loans from
five institutions including the National Bank of Poland (NBP), the Polish Financial Supervision Authority (UKNF), the
Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman.
The positions of: the Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman
are in general favourable to consumers, while the National Bank of Poland and the Polish Financial Supervision
Authority present a more balanced position, including fair principles of treatment of FX mortgage borrowers vis-\u00e0-vis
PLN mortgage borrowers, as well as balanced economic aspects regarding solutions for the problem that could be
considered by the Polish Supreme Court.
In the next meeting of the Supreme Court that took place on 2 September 2021, the Court did not address the answers
to the submitted questions and no new meeting date is known.
On 12 August 2021, in the case for payment brought by a consumer against Bank Millennium, the CJEU was asked for a
preliminary ruling (C-520/21) whether, in the event that a loan agreement concluded by a bank and a consumer is
deemed invalid from the beginning due to unfair contract terms, the parties, in addition to the reimbursement of the
money paid in contracts (bank - loan capital, consumer - instalments, fees, commissions and insurance premiums) and
statutory interest for delay from the moment of demanding for payment, may also claim any other benefits, including
receivables in particular, remuneration, compensation, reimbursement of costs or valorization of the performance. The
hearing was held on 12 October 2022. The hearing was attended by representatives of Bank Millennium, the consumer's
representative, representatives of the European Commission, the Polish government, the Financial Ombudsman, the
Commissioner for Human Rights, the Polish Financial Supervision Authority and the prosecutor. In its position, the
European Commission opposed granting banks the right to an additional financial benefit for the consumer's use of the
capital provided. At the same time, the Commission concluded that granting consumers the right to an additional
financial benefit will not be contrary to the EU law. The representatives of the Polish government, the Financial
Ombudsman, the Commissioner for Human Rights and the prosecutor also objected to granting banks the right to an
additional benefit. The Chairman of the Polish Financial Supervision Authority pointed out that the essence of the
problem is not the abusiveness of contractual clauses, but the appreciation of the Swiss Franc (CHF) against the zloty
(PLN). In the opinion of the Chairman of the Polish Financial Supervision Authority, banks are entitled to economic
compensation for allowing another entity to use the capital.
Regarding the case C-520/21 which is awaiting decision by the CJEU, whose object essentially concerns possible
compensation for financing when a mortgage loan agreement indexed to foreign currency concluded between a
consumer and a bank is declared void from the beginning due to unfair contract terms, the Advocate General issued an
opinion on 16 February 2023 in the sense that the Article 6 no. 1 and Article 7 no. 1 of Council Directive 93/13/EC of 5
of April 1993, concerning unfair terms in contracts concluded with consumers, must be interpreted as:
- do not preclude a jurisprudential interpretation of national law under which the consumer, in addition to
reimbursement the amounts paid under that contract and paying default interest at the statutory rate from the date of
the reimbursement request, may present additional claims to the bank as a result of that declaration of invalidity. It is
thus a matter for the national court to determine, by reference to its domestic law, whether consumers have the right
to assert claims of that nature and, if so, to rule on their merits.
- preclude a jurisprudential interpretation of national law under which, the Bank in addition to the reimbursement of
the amounts paid under that contract and paying default interest at the statutory rate from the date of the
reimbursement request, may present additional claims against the consumer as a result of that declaration of
invalidity.
If the final decision of the CJEU judge comes in the same direction as that of the Advocate General, this may lead to an
increase in provisions for legal risk related to mortgage loans in CHF, especially if this results in a revision of the
expected influx of new cases in court.
On 9 December 2022, in the case brought by Bank Millennium against the borrower for payment \u2013 return of the capital
made available to the borrower on the basis of an invalid capital contract and the equivalent value of the benefit
related to the borrower's use of capital, the court referred a question to the CJEU for a preliminary ruling whether, if it
is found that the loan contract concluded by the bank and the consumer is invalid from the beginning due to the
conclusion of unfair contractual terms, in addition to the return of money paid in the performance of this contract
(loan principal) and statutory late payment interest from the moment of the request for payment, the bank may also
demand any other benefits, including receivables, in particular remuneration, compensation, reimbursement of costs or
valorisation of the benefit. The case was registered under the reference number C-756/22. Referring the question, the
court asked the CJEU to join the case with the above-mentioned ongoing proceedings under reference number
C-520/21. The CJEU decided not to join the cases and simultaneously suspended case C-756/22 up to judgment in case
C- 520/21.
With the scope of settlements between Bank Millennium and borrower following the fall of the loan agreement is also
connected the legal issue directed to the seven-person composition of the Polish Supreme Court (case sign: III CZP
54/21). The date of case review has not been specified yet.
The Supreme Court was also presented with the issue of whether the loan agreement is a mutual agreement in the light
of the regulations concerning retention right.
On 8 December 2020, Mr. Jacek Jastrz\u0119bski, the Chairman of the Polish Financial Supervision Authority (\u2018PFSA\u2019)
proposed a \u2018sector\u2019 solution to address the sector risks related to FX mortgages. The solution would consist in offering
by banks to their clients a voluntary possibility of concluding arrangements based on which a client would conclude
with the bank a settlement as if his/her loan from the very beginning had been a PLN loan bearing interest at an
appropriate WIBOR rate increased by the margin historically employed for such loan.
Following that public announcement, the idea was subject of consultations between banks under the auspices of the
PFSA and Polish Banking Association. Banks in general have assessed the conditions under which such solution could be
implemented and consequent impacts.
As expressed in previous financial reports, when that assessment was done, in the view of the Management Board of
Bank Millennium, important aspects to take into consideration when deciding on potential implementation of such
program were: a) favourable opinion or at least non-objection from important public institutions; b) support from
National Bank of Poland to the implementation; c) level of legal certainty of the settlement agreements to be signed
with the borrowers; d) level of the financial impact on a pre- and after tax basis; e) capital consequences including
regulatory adjustments in the level of capital requirements associated with FX mortgage loans.
Based on current information some of the above-mentioned aspects are not likely to be fully clarified and/or achieved.
Any decision regarding implementation of such program would require the Management Board to submit it to the
Supervisory Board and General Shareholders meeting of Bank Millennium taking into consideration the relevance of such
decision and its implications.
Despite the fact that not all of those aspects have been possible to clarify, Bank Millennium, in practice, has been using
elements of such solution on several individual negotiations with FX mortgage borrowers, including in the course of
court proceedings.
The effect of the Polish Supreme Court's resolution of 7 May 2021 is that Bank Millennium is entitled to a refund of the
cash benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the
uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to protect
its interests, files lawsuits for payment against borrowers in a court dispute with the bank. Bank Millennium's demand
consists of a claim for return of the capital made available to the borrower under the contract and a claim for
reimbursement of the equivalent of the benefit obtained by the borrower in connection with the use of the capital
made available (equivalent to the financial service). By 31 December 2022, Bank Millennium filed over 3,000 lawsuits
against the borrowers. Due to the ongoing proceedings on questions referred for a preliminary ruling (C-520/21,
C-756/22) concerning the scope of claims of the parties to an invalid contract, no final decision has yet been issued in
Bank Millennium's cases containing a substantive assessment of the Bank's claims for reimbursement of benefits related
to the use of capital.
Due to the complexity and uncertainty regarding the outcome of court cases, including counter-claims, as well as from
potential implementation of KNF Chairman solution or other negotiation solutions or from potential Supreme Court
decisions or European Court of Justice decisions, it is difficult to reliably estimate final impacts from different potential
outcomes as at the date of publication of the financial statements.
Recently issued accounting standards
1 -Recently issued accounting standards and interpretations that came into force in the
current financial year
At the date of approval of these financial statements, the following accounting standards, interpretations, amendments
and revisions were endorsed by the European Union (EU) with mandatory application for the financial year of the Group
started on 1 January 2022:
Amendment to IFRS 3: Reference to the conceptual framework
This amendment aims to update IFRS 3 so that it corresponds to the conceptual framework of 2018, not occurring
significant changes in the requirements of this standard.
There were no material impacts on the application of this amendment in the Group's financial statements.
Amendment to IAS 16: Property, Plant and Equipment \u2014 Proceeds before intended use
This amendment prohibits an entity from deducting from the cost of a property, plant or equipment any proceeds
arising from the sale of items produced while the entity prepares the asset to operate as intended, at the location and
necessary conditions. The entity shall recognize any proceeds arising from those sales and the respective costs of
production in the income statement.
There were no material impacts on the application of this amendment in the Group's financial statements.
Amendment to IAS 37: Onerous contracts \u2014 Cost of fulfilling a contract
This amendment aims to clarify what costs an entity should consider as related to the fulfilling of a contract when
assessing whether a contract is onerous. It also specifies that the costs of fulfilling a contract correspond only to the
costs directly related to it, which may take the form of incremental costs or of an allocation of other costs directly
related to the fulfilling of the contract.
There were no material impacts on the application of this amendment in the Group's financial statements.
Improvements to international financial reporting standards (cycle 2018-2020)
These improvements comprise the clarification of some aspects related to: IFRS 1 \u2014 First-time adoption of International
Financial Reporting Standards: allows a subsidiary that adopts IFRS for the first time to measure cumulative translation
differences based on the amounts presented in the consolidated financial statements of its parent company, according
to the transition date of the parent company to IFRS; IFRS 9 \u2014 Financial instruments: clarifies that, when assessing the
derecognition of a financial liability, an entity should only consider fees paid or received between the entity and the
lender, including fees paid or received by one on behalf of the other; IFRS 16 \u2014 Leases: amendment to illustrative
example 13 presented in the standard, in order to avoid the emergence of doubts regarding the treatment of lease
incentives; IAS 41 \u2014 Agriculture: removal of the requirement to exclude taxation cash flows when measuring the fair
value of a biological asset, thus ensuring consistency with IFRS 13 \u2014 Fair value measurement.
There were no material impacts on the application of these improvements in the Group's financial statements.
2 -Standards, interpretations, amendments and revisions that will take effect in future
financial years
The following standards, interpretations, amendments and revisions, with mandatory application in future financial
years, have been endorsed by the European Union until the date of approval of these financial statements:
IFRS 17 \u2014 Insurance contracts (applicable for years beginning on or after 1 January 2023)
This standard establishes, for insurance contracts within its scope, the principles for their recognition, measurement,
presentation and disclosure. This standard replaces IFRS 4 \u2013 Insurance contracts.
This accounting standard, although endorsed by the European Union, was not adopted by the Group in 2022 as its
application is not mandatory yet.
Amendment to IAS 8: Definition of accounting estimates (applicable for years beginning on or after 1 January
2023)
This amendment emphasizes how companies should distinguish changes in accounting policies from changes in
accounting estimates, which is relevant since changes in accounting estimates are applied prospectively, only to future
transactions and other events, while changes in accounting policies are generally applied retrospectively to past
transactions and other events.
This amendment, although endorsed by the European Union, was not adopted by the Group in 2022 as its application is
not mandatory yet.
Amendments to IAS 1 and IFRS Practice Statement 2: Disclosure of accounting policies (applicable for years
beginning on or after 1 January 2023)
Amendments to IAS 1 require companies to disclose their material accounting policy information rather than their
significant accounting policies, further explaining how an entity can identify a material accounting policy. On the other
hand, Amendments to IFRS Practice Statement 2 provide guidance on how to apply the concept of materiality to
accounting policy disclosures.
These amendments, although endorsed by the European Union, were not adopted by the Group in 2022 as their
application is not mandatory yet.
Amendment to IAS 12: Deferred tax related to assets and liabilities arising from a single transaction (applicable for
years beginning on or after 1 January 2023)
This amendment requires companies to recognise deferred tax on particular transactions that, on initial recognition,
give rise to equal amounts of taxable and deductible temporary differences. The proposed amendment will mostly
apply to transactions such as leases and decommissioning obligations.
This amendment, although endorsed by the European Union, was not adopted by the Group in 2022 as its application is
not mandatory yet.
Amendment to IFRS 17: Initial application of IFRS 17 and IFRS 9 \u2014 Comparative information (applicable for years
beginning on or after 1 January 2023)
This amendment is aimed at helping entities to avoid temporary accounting mismatches between financial assets and
insurance contract liabilities by providing insurers with an option for the presentation of comparative information about
financial assets, thus improving the usefulness of comparative information for users of financial statements.
This amendment, although endorsed by the European Union, was not adopted by the Group in 2022 as its application is
not mandatory yet.
3 -Standards, interpretations, amendments and revisions not adopted by the European
Union yet
The following standards, interpretations, amendments and revisions, with mandatory application in future financial
years, have not been endorsed by the European Union until the date of approval of these financial statements, and,
therefore, have not been applied by the Group:
Amendment to IAS 1: Classification of liabilities as current or non-current and Classification of liabilities as current
or non-current \u2014 Deferral of effective date (applicable for years beginning on or after 1 January 2024)
On 23 January 2020, Amendment to IAS 1: Classification of liabilities as current or non-current was issued, which aims
to clarify that the classification of liabilities as current or non-current should be made based on the existing rights at
the end of the financial reporting period, not being affected by expectations related to the exercise of the right to
defer the settlement of a liability and, additionally, that the settlement corresponds to the extinction of a liability by
transferring cash, equity instruments, other assets or services to a counterparty.
On 15 July 2020, it was decided to postpone by a year the effective date of the referred amendment.
Amendment to IAS 1: Non-current liabilities with covenants (applicable for years beginning on or after 1 January
2024)
This amendment was issued on 31 October 2022 and it clarifies that only covenants with which an entity must comply
on or before the reporting date will affect a liability\u2019s classification as current or non-current.
Amendment to IFRS 16: Lease liability in a sale and leaseback (applicable for years beginning on or after 1 January
2024)
This amendment was issued on 22 September 2022 and it provides changes that specify how a seller-lessee should apply
the subsequent measurement requirements in IFRS 16 to the lease liability that arises in sale and leaseback operations.
List of subsidiary and associated companies of Banco Comercial Portugu\u00eas
Group
As at 31 December 2022, the Group's subsidiary companies included in the consolidated accounts using the full
consolidation method were as follows:
Group
Bank
Subsidiary companies
Head
office
Share
capital
Curre
ncy
Sector of activity
% economic
interests
% effective
held
% direct
held
Banco ActivoBank, S.A.
Lisbon
127,600,000
EUR
Banking
100%
100%
100%
Bank Millennium, S.A.
Warsaw
1,213,116,777
PLN
Banking
50.1%
50.1%
50.1%
Millennium Bank Hipoteczny S.A.
Warsaw
57,000,000
PLN
Banking
100%
50.1%
\u2014
BCP \u00c1frica, S.G.P.S., Lda.
Funchal
682,965,800
EUR
Holding company
100%
100%
100%
BIM - Banco Internacional de
Mo\u00e7ambique, S.A.
Maputo
4,500,000,000
MZN
Banking
66.7%
66.7%
\u2014
BCP Finance Bank, Ltd.
George
Town
246,000,000
USD
Banking
100%
100%
\u2014
BCP International B.V.
Amsterdam
18,000
EUR
Holding company
100%
100%
100%
Millennium BCP\u00a0 - Escrit\u00f3rio de
Representa\u00e7\u00f5es e Servi\u00e7os, Ltda.
S\u00e3o Paulo
70,062,159
BRL
Financial Services
100%
100%
100%
Millennium bcp Participa\u00e7\u00f5es,
S.G.P.S., Sociedade Unipessoal,
Lda.
Funchal
25,000
EUR
Holding company
100%
100%
100%
Interfundos - Sociedade Gestora
de Organismos de\u00a0 Investimento
Coletivo, S.A.
Oeiras
1,500,000
EUR
Investment fund
management
100%
100%
100%
Monumental Residence -
Sociedade Especial de
Investimento Imobili\u00e1rio de
Capital Fixo, SICAFI, S.A.
Oeiras
32,859,181
EUR
Real-estate
management
100%
100%
100%
Millennium bcp - Presta\u00e7\u00e3o de
Servi\u00e7os, A.C.E.
Lisbon
331,750
EUR
Services
98.6%
97.7%
93.2%
Millennium bcp Teleservi\u00e7os -
Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico,
S.A.
Lisbon
50,004
EUR
E-commerce
100%
100%
100%
Flitptrel Tires, S.A.
Lisbon
50,000
EUR
Real-estate
company
100%
100%
100%
Bichorro \u2013 Empreendimentos
Tur\u00edsticos\u00a0 e Imobili\u00e1rios S.A.
Oeiras
2,150,000
EUR
Real-estate
management
100%
100%
\u2014
Finalgarve \u2013 Sociedade de
Promo\u00e7\u00e3o Imobili\u00e1ria\u00a0 Tur\u00edstica,
S.A.
Oeiras
250,000
EUR
Real-estate
management
100%
100%
\u2014
Fiparso \u2013 Sociedade Imobili\u00e1ria
S.A
Oeiras
50,000
EUR
Real-estate
company
100%
100%
\u2014
Millennium Consulting S.A.
Warsaw
4,339,500
PLN
Consulting services
100%
50.1%
\u2014
Millennium Goodie Sp.z.o.o.
Warsaw
500,000
PLN
Web portals
100%
50.1%
\u2014
Millennium Leasing, Sp.z o.o.
Warsaw
48,195,000
PLN
Leasing
100%
50.1%
\u2014
Millennium Service, Sp.z o.o.
Warsaw
1,000,000
PLN
Services
100%
50.1%
\u2014
Millennium Financial Services,
Sp.z o.o.
Warsaw
100,000
PLN
Services
100%
50.1%
\u2014
Piast Expert Sp. z o.o (em
liquida\u00e7\u00e3o)
Tychy
100,000
PLN
Marketing services
100%
50.1%
\u2014
Millennium Telecommunication
Services Sp. z o.o.
Warsaw
100,000
PLN
Brokerage services
100%
50.1%
\u2014
Millennium TFI - Towarzystwo
Funduszy Inwestycyjnych, S.A.
Warsaw
10,300,000
PLN
Investment fund
management
100%
50.1%
\u2014
(*) - Company classified as non-current assets held for sale.
During 2022, the Group proceeded with the liquidation of \"Millennium Fundo de Capitaliza\u00e7\u00e3o - Fundo de Capital de
Risco\".
The Group holds a securitization transaction regarding mortgage loans which was set through specifically created SPE.
As referred in accounting policy 1 B, when the substance of the relationships with the SPEs indicates that the Group
holds control of its activities, the SPE is fully consolidated, following the application of IFRS 10.
As at 31 December 2022, the Special Purpose Entity included in the consolidated accounts under the full consolidation
method is as follows:
Group
Bank
Special Purpose Entities
Head
office
Share
capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Magellan Mortgages No.3 Limited
Dublin
40,000
EUR
Special Purpose
Entities
82.4%
82.4%
82.4%
As at 31 December 2022, the Group's associated companies included in the consolidated accounts under the equity
method are as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Banco Millennium Atl\u00e2ntico, S.A.
Luanda
53,821,603,000
AOA
Banking
22.7%
22.5%
\u2014
Banque BCP, S.A.S.
Paris
198,295,587
EUR
Banking
19.0%
19.0%
19.0%
Lubuskie Fabryki Mebli, S.A. (em
liquida\u00e7\u00e3o)
Swiebodzin
13,400,050
PLN
Furniture
manufacturer
50%
25.1%
\u2014
SIBS, S.G.P.S., S.A.
Lisbon
24,642,300
EUR
Banking services
23.3%
21.9%
\u2014
UNICRE - Institui\u00e7\u00e3o Financeira
de Cr\u00e9dito, S.A.
Lisbon
10,000,000
EUR
Credit cards
32%
32%
0.54%
Webspectator Corporation
Delaware
950
USD
Digital advertising
services
25.1%
25.1%
25.1%
equity method were as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Millenniumbcp Ageas Grupo
Segurador,\u00a0 S.G.P.S., S.A.
Lisbon
50,002,375
EUR
Holding company
49%
49%
49%
Ocidental - Companhia Portuguesa
de Seguros de Vida, S.A.
Lisbon
22,375,000
EUR
Life insurance
49%
49%
\u2014
Ageas - Sociedade Gestora de
Fundos de Pens\u00f5es, S.A.
Lisbon
1,200,000
EUR
Pension fund
management
49%
49%
\u2014
Fidelidade Mo\u00e7ambique -
Companhia de Seguros S.A.(*)
Maputo
295,000,000
MZN
Insurance
22%
14.7%
\u2014
In December 2022, Seguradora Internacional de Mo\u00e7ambique, S.A. changed its corporate name to Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.
Some indicators of the main subsidiaries and associated companies are analysed as follows:
2022
2021
Subsidiaries and associated companies
Total
Assets
Total
Equity
Net income
for the year
Total
Assets
Total
Equity
Net income
for the year
Banco ActivoBank, S.A.
3,271,355
213,017
19,142
2,786,258
194,491
13,536
Bank Millennium, S.A. (1)
23,697,447
1,173,617
(216,683)
22,669,323
1,461,037
(291,927)
BIM - Banco Internacional de Mo\u00e7ambique, S.A. (1)
2,824,409
521,192
106,030
2,526,707
558,904
95,566
BCP International B.V.
524,966
524,627
87,434
976,464
976,192
(361)
BCP Finance Bank, Ltd.
520,294
519,976
4,996
520,002
519,686
4,227
BCP \u00c1frica, S.G.P.S., Lda.
561,713
560,269
60,975
500,105
499,294
(26,955)
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade
Unipessoal, Lda.
179,441
178,297
11,406
177,258
177,244
10,353
Interfundos - Sociedade Gestora de Organismos de\u00a0
Investimento Coletivo, S.A.
9,731
8,113
2,084
9,228
7,722
2,531
Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. (1) (2)
8,876,759
401,717
74,425
10,693,447
820,921
69,900
Banco Millennium Atl\u00e2ntico, S.A. (3)
2,910,070
292,893
10,693
2,712,137
296,392
11,563
Banque BCP, S.A.S.
4,944,774
268,097
23,499
4,477,971
236,548
20,447
1) Consolidated accounts.
2) Includes VOBA annual amortisation. The value of the acquired business (VOBA) corresponds to the estimated current value of the
future cash flows of the contracts in force at the date of acquisition and it is recognised in the consolidated accounts of Millenniumbcp
Ageas Grupo Segurador, S.G.P.S., S.A. as intangible assets and is amortised over the period of recognition of the income associated
with the policies acquired.
3) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
Subsequent events
In addition to the aspects disclosed in the other notes and according to the accounting policy 1 Z, the events that
occurred after the date of the financial statements and until the date of its approval, were as follows:
Approval of the application of article 352 (2) of the CRR
On March 24, 2023, BCP was notified of the favourable decision of the supervisory authority on the request for the
application of article 352 (2) of the CRR for the exclusion of the calculation of weighted assets for market risk of
certain structural exchange positions for hedging of regulatory ratios against changes in exchange rates. The change has
an estimated impact on the fully implemented CET1 ratio of around 50 basis points and of around 70 basis points in the
total capital ratio.
Signing of conditional agreement concerning the sale of Millennium Financial Services sp.zo.o.
and strategic insurance cooperation
The Management Board of Bank Millennium S.A. informed that following necessary corporate approvals, on 13 February
2023, Bank Millennium executed the agreement (the \"Agreement\") for the sale of 80% of the shares (the \u201cShares\u201d) in
Millennium Financial Services sp. z o.o. (the \u201cCompany\u201d) to Towarzystwo Ubezpiecze\u0144 na \u017bycie Europa S.A. which
acquires 72% of the Company\u2019s shares and Towarzystwo Ubezpiecze\u0144 Europa S.A. which acquires 8% of the Company\u2019s
shares (collectively the \"Buyers\").
Bank Millennium concluded also with the Buyers and the Company certain agreements concerning exclusive insurance
distribution model, including a cooperation agreement, distribution agreements and agency agreements (the \"Strategic
Insurance Cooperation\"). The Strategic Insurance Cooperation provides for long term (10 years) bancassurance liaison in
relation specified insurance products linked to loans offered by Bank Millennium.\u00a0
The essence of the transaction contemplated by the Agreement is the direct acquisition of the Shares by the Buyers
from Bank Millennium for a pre-defined initial price which may be subject to a price adjustment mechanism after the
Transaction is closed, (i.e. after transfer of legal title to the Shares to the Buyers and payment of the Price, \"Closing\")
and establishment of the Strategic Insurance Cooperation (the \"Transaction\"). If the Transaction will close successfully,
the Bank expects to recognize an upfront pre-tax gain on the transaction of approximately PLN 500 million (Euros 106.8
million).
The Closing of the Transaction is subject to the fulfilment of a condition precedent \u2013 obtaining the relevant consent of
the relevant antimonopoly authority (the \"Condition\").
Bank Millennium will publish information on the fulfilment or non-fulfilment of the Condition in relevant current
reports. The Parties may also withdraw from the Agreement in certain situations indicated therein and penalties may
apply in case of failure of one of the Parties to fulfil its obligations under the Transaction documentation.
The Transaction documentation contains a certain catalogue of representations and warranties from Bank Millennium
and the Buyers with respect to the Shares and Strategic Insurance Cooperation, as well as sets out the principles of the
Parties' liability thereunder.
", "dimensions": { "concept": "ifrs-full:DisclosureOfNotesAndOtherExplanatoryInformationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-554": { "value": "
Banco Comercial Portugu\u00eas, S.A. (the \u2018Bank\u2019) is a private capital bank, established in Portugal in 1985. It started
operating on 5 May 1986, and these consolidated financial statements reflect the results of the operations of the Bank
and all its subsidiaries (together referred to as the \u2018Group\u2019) and the Group\u2019s interest in associates, for the years ended
on 31 December 2022 and 2021.
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
All the references in this document related to any normative always report to the respective current version.
The consolidated financial statements for the year ended on 31 December 2022 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
These consolidated financial statements are a translation of the financial statements originally issued in Portuguese. In
the event of discrepancies, the Portuguese version prevails.
", "dimensions": { "concept": "ifrs-full:DisclosureOfGeneralInformationAboutFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-555": { "value": "
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAuthorisationOfFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-556": { "value": "
In accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002, and
Bank of Portugal Notice no. 5/2015 (which revoked Bank of Portugal Notice no. 1/2005), the Group\u2019s consolidated
financial statements are required to be prepared, since 2005, in accordance with International Financial Reporting
Standards (IFRS) as endorsed by the European Union (EU). IFRS comprise accounting standards issued by the
International Accounting Standards Board (IASB), as well as interpretations issued by the International Financial
Reporting Interpretations Committee (IFRIC) and its predecessor bodies. The consolidated financial statements and the
accompanying notes were approved on 27 March 2023 by the Bank's Board of Directors and are presented in thousands
of euros, rounded to the nearest thousand.
The Group's financial statements were prepared under the going concern assumption, the accrual-based accounting
regime and under the historical cost convention, as modified by the application of fair value for derivative financial
instruments, financial assets and liabilities at fair value through profit or loss and financial assets at fair value through
other comprehensive income. Financial assets and liabilities that are covered under hedge accounting are stated at fair
value in respect of the risk that is being hedged, if applicable. Other financial assets and liabilities and non-financial
assets and liabilities are stated at amortised cost or historical cost. Non-current assets and disposal groups held for sale
are stated at the lower of carrying amount or fair value less costs to sell. The liability for defined benefit obligations is
recognised as the present value of the past liabilities with pensions net of the value of the fund's assets.
The preparation of the financial statements in accordance with IFRS requires the Board of Directors, under advice of
the Executive Committee, to make judgments, estimations and assumptions that affect the application of the
accounting policies and reported amounts of assets, liabilities, income and expenses. The estimations and associated
assumptions are based on historical experience and other factors that are believed to be reasonable under the
circumstances and form the basis for making the judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimations. The issues involving a higher
degree of judgment or complexity or for which assumptions and estimations are significant are presented in note 1.Y.", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfPreparationOfFinancialStatementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-557": { "value": "
The consolidated financial statements for the year ended on 31 December 2022 were prepared for the purpose of
recognition and measurement, in accordance with the IFRS approved by the EU that are effective on that date.
The Group has adopted IFRS and interpretations mandatory for accounting periods beginning on or after 1 January 2022.
The accounting policies were applied consistently to all entities of the Group and are consistent with those used in the
preparation of the financial statements of the previous period.", "dimensions": { "concept": "ifrs-full:StatementOfIFRSCompliance", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-558": { "value": "
As from 1 January 2010, the Group began to apply IFRS 3 (revised) for the accounting of business combinations. The
changes in the accounting policies resulting from the application of IFRS 3 (revised) are applied prospectively.
The consolidated financial statements now presented reflect the assets, liabilities, income and expenses of the Bank
and its subsidiaries (the Group), and the results attributable to the Group financial investments in associates.
B1.Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
B2.Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
B3.Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
B4.Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is accounted as a
transaction with shareholders and, therefore, no additional goodwill resulting from this transaction is recognised. The
difference between the acquisition cost and the fair value of non-controlling interests acquired is recognised directly in
reserves. On this basis, the gains and losses resulting from the sale of controlling interests that do not impact the
control position of a subsidiary are always recognised against reserves.
B5.Loss of control
The gains and losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
B6.Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity methods,
exchange differences, between the conversion to euros of the equity at the beginning of the year and its value in euros
at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are recognised against
\u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that are designated and
qualified as hedging instruments related to foreign operations are recorded in equity under \"Reserves and retained
earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted against profit and loss of the
year.
The income and expenses of these subsidiaries are converted to euros at an approximate rate of the rates on the dates
of the transactions, using a monthly average considering the initial and final exchange rates of each month. Exchange
differences from the conversion to euros of the profits and losses for the reporting period, arising from the difference
between the exchange rate used in the income statement and the exchange rate prevailing at the balance sheet date,
are recognised in \"Reserves and retained earnings - exchange differences resulting from the consolidation of Group's
companies\". The exchange rates used by the Group are detailed in note 54.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to the
investment in the foreign operation and to the associated hedge transaction previously recognised in reserves are
transferred to profit and loss, as part of the gains or loss arising from the disposal.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
Equity components are also updated considering the price index from the beginning of the period or date of the
contribution if it is earlier.
When the classification as a hyperinflationary economy is applied to associated companies, its effects are included in
the Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items are
recognised against the item \"Reserves and retained earnings\".
In accordance with the requirements provided in IAS 29, Angola was considered as a hyperinflationary economy until 31
December 2018. This classification is no longer applicable as of 1 January 2019.
B7.Transactions eliminated on consolidation
The balances and transactions between Group's companies, as well as any unrealised gains and losses arising from these
transactions, are eliminated in the preparation of the consolidated financial statements. Unrealised gains and losses
arising from transactions with associates and jointly controlled entities are eliminated in the proportion of the Group's
investment in these entities.
Entities included in the consolidation perimeter
For the purposes of determining entities to include in the consolidation perimeter, the Group assesses whether it is
exposed to, or has rights to, the variable returns from its involvement with the entity and if it can take possession of
these results through the power it holds (de facto control). The decision if an entity needs to be consolidated by the
Group requires the use of judgment, estimations and assumptions to determine at what extent the Group is exposed to
the variable returns and its ability to use its power to affect these returns. Different estimations and assumptions could
lead the Group to a different scope of consolidation perimeter with a direct impact in consolidated income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfBasisOfConsolidationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-559": { "value": "Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentsOtherThanInvestmentsAccountedForUsingEquityMethodExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-560": { "value": "Investments in subsidiaries
Subsidiaries are entities controlled by the Group (including structure entities and investment funds). The Group controls
an entity when it holds the power to direct the relevant activities of the entity, and when it is exposed, or has rights,
to variable returns from its involvement with the entity and can take possession of these results through the power it
holds over the relevant activities of that entity (de facto control). The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control
ceases.
Accumulated losses are attributed to non-controlling interests in the respective proportion, implying that the Group can
recognise negative non-controlling interests.
On a step acquisition process resulting in the acquisition of control, the revaluation of any participation previously
acquired is recorded against the profit and loss account when goodwill is calculated. On a partial disposal resulting in
loss of control over a subsidiary, any participation retained is revalued at market value on the sale date and the gain or
loss resulting from this revaluation is booked against the income statement.
Loss of control
The gains and losses resulting from the dilution or sale of a financial position in a subsidiary, with loss of control, are
recognised by the Group in the income statement.
Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
Regarding the investments in foreign operations that are consolidated under the full consolidation or equity methods,
exchange differences, between the conversion to euros of the equity at the beginning of the year and its value in euros
at the exchange rate on the balance sheet date in which the consolidated accounts are reported, are recognised against
\u201cReserves - exchange differences\u201d. The changes in fair value resulting from instruments that are designated and
qualified as hedging instruments related to foreign operations are recorded in equity under \"Reserves and retained
earnings\". Whenever the hedge is not fully effective, the ineffective portion is accounted against profit and loss of the
year.
The income and expenses of these subsidiaries are converted to euros at an approximate rate of the rates on the dates
of the transactions, using a monthly average considering the initial and final exchange rates of each month. Exchange
differences from the conversion to euros of the profits and losses for the reporting period, arising from the difference
between the exchange rate used in the income statement and the exchange rate prevailing at the balance sheet date,
are recognised in \"Reserves and retained earnings - exchange differences resulting from the consolidation of Group's
companies\". The exchange rates used by the Group are detailed in note 54.
On disposal of investments in foreign subsidiaries for which there is loss of control, exchange differences related to the
investment in the foreign operation and to the associated hedge transaction previously recognised in reserves are
transferred to profit and loss, as part of the gains or loss arising from the disposal.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSubsidiariesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-561": { "value": "Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
Investments in foreign subsidiaries and associates
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
When the classification as a hyperinflationary economy is applied to associated companies, its effects are included in
the Group's financial statements by applying the equity method of accounting on the financial statements restated in
accordance with the requirements of IAS 29. The effects of the application of IAS 29 with impact on capital items are
recognised against the item \"Reserves and retained earnings\".
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociates", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-562": { "value": "Investments in associates
Investments in associated companies are registered by the equity method from the date that the Group acquires
significant influence until the date it ceases to exist. Associates are those entities in which the Group has significant
influence but not control over the financial and operating policy decisions of the investee. It is assumed that the Group
has significant influence when it holds, directly or indirectly, more than 20% or of the voting rights of the investee. If
the Group holds, directly or indirectly, less than 20% of the voting rights of the investee, it is presumed that the Group
does not have significant influence, unless such influence can be clearly demonstrated.
The existence of significant influence by the Group is usually evidenced in one or more of the following ways:
-representation on the Board of Directors or equivalent governing body of the investee;
-participation in policy-making processes, including participation in decisions about dividends or other distributions;
-material transactions between the Group and the investee;
-interchange of the management team;
-provision of essential technical information.
The consolidated financial statements include the part that is attributable to the Group of the total reserves and
results of associated companies accounted on an equity basis. When the Group\u2019s share of losses exceeds its interest in
the associate, the carrying amount is reduced to zero and recognition of further losses is discontinued, with exception
of the part in which the Group incurs in a legal obligation to assume these losses on behalf of an associate.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInvestmentInAssociatesAndJointVenturesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-563": { "value": "Goodwill
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-564": { "value": "
Business combinations are accounted under the purchase method. The acquisition cost corresponds to the fair value,
determined at the acquisition date, of the assets given and liabilities incurred or assumed. Costs directly attributable
to the acquisition of a subsidiary are recorded directly in the income statement.
According to IFRS 3 \u2013 Business combinations, if the initial accounting of a business combination is not concluded until
the end of the first financial reporting period in which the combination occurs, it is recorded at the respective
provisional values. These provisional values can be adjusted over the measurement period, which can\u2019t exceed a year
since the acquisition date. Over this period, the Group should retrospectively adjust the amounts recognised previously
on the acquisition date, to reflect newly obtained information about facts and circumstances that existed at the
acquisition date and that, if they were known by then, would have impacted the measurement of the amounts
recognised at that date.
During this period, the Group should also recognise additional assets and liabilities in the case of obtaining new
information about facts and circumstances that existed at the acquisition date and that, if they were known by then,
would have resulted in the recognition of those assets and liabilities at that time.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForBusinessCombinationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-565": { "value": "
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIntangibleAssetsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-566": { "value": "
Positive goodwill arising from acquisitions is recognised as an asset carried at acquisition cost and is not subject to
amortisation, however, it is subject to impairment tests. Goodwill arising from the acquisition of subsidiaries and
associates is defined as the difference between the cost of acquisition and the total or corresponding share of the fair
value of the net assets and contingent liabilities acquired, depending on the option taken.
Negative goodwill arising from an acquisition is recognised directly in the income statement of the period in which the
business combination occurs.
Goodwill is not adjusted due to changes in the initial estimation of the contingent purchase price, being the difference
recorded in the income statement or in equity, when applicable.
The recoverable amount of the goodwill registered in the Group's asset is assessed annually in the preparation of the
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. Impairment
losses are recognised in the income statement. The recoverable amount is determined based on the higher of the asset
value in use and the market value after deducting selling costs, calculated using valuation methodologies supported by
discounted cash flow techniques, considering market conditions, the time value of money and the business risks.
Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-567": { "value": "Purchases and dilution of non-controlling interests
The acquisition of non-controlling interests that do not impact the control position of a subsidiary is accounted as a
transaction with shareholders and, therefore, no additional goodwill resulting from this transaction is recognised. The
difference between the acquisition cost and the fair value of non-controlling interests acquired is recognised directly in
reserves. On this basis, the gains and losses resulting from the sale of controlling interests that do not impact the
control position of a subsidiary are always recognised against reserves.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithNoncontrollingInterestsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-568": { "value": "
The financial statements of foreign subsidiaries and associates of the Group are prepared in their functional currency,
defined as the currency of the primary economic environment in which they operate or the currency in which the
subsidiaries obtain their income or finance their activity. In the consolidation process, assets and liabilities, including
goodwill, of foreign subsidiaries are converted into euros at the official exchange rate on the balance sheet date.
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
Transactions in foreign currencies are converted into the respective functional currency of the operation at the foreign
exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are
converted into the respective functional currency of the operation at the foreign exchange rate on the reporting date.
Foreign exchange differences arising from conversion are recognised in the income statement. Non-monetary assets and
liabilities denominated in foreign currencies, which are stated at historical cost, are converted into the respective
functional currency of the operation at the foreign exchange rate on the date of the transaction. Non-monetary assets
and liabilities denominated in foreign currencies that are stated at fair value are converted into the respective
functional currency of the operation at the foreign exchange rate on the date that the fair value was determined
against profit and loss, except for financial assets at fair value through other comprehensive income, for which the
difference is recognised against equity.
R.
As described in accounting policy 1.B, the financial statements of the Group's subsidiaries and associates placed abroad
are prepared in their functional currency and translated into Euros at the end of each financial period. The exchange
rates used for the conversion of balance sheet foreign currency amounts are the ECB reference rates at the end of each
period. In foreign currency conversion of results, are calculated average exchange rates according to the closing
exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
(Balance sheet)
(Income statement)
Currency
2022
2021
2022
2021
AOA
543.2680
632.4200
487.7116
747.0708
BRL
5.6390
6.3364
5.4153
6.3950
CHF
0.9872
1.0362
1.0042
1.0811
MOP
8.5744
9.1330
8.5744
9.1330
MZN
68.1850
72.9000
67.5585
77.9329
PLN
4.6816
4.5839
4.6823
4.5623
USD
1.0667
1.1373
1.0537
1.1833
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFunctionalCurrencyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-569": { "value": "
The Group applies IAS 29 \u2013 Financial reporting in hyperinflationary economies in financial statements of entities that
present accounts in functional currency of an economy that has hyperinflation. In applying this policy, non-monetary
assets and liabilities are adjusted based on the price index from the date of acquisition or the date of the last
revaluation until 31 December 2021. The restated values of assets are reduced by the amount that exceeds their
recoverable amount, in accordance with the applicable IFRS.
", "dimensions": { "concept": "ifrs-full:DisclosureOfHyperinflationaryReportingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-570": { "value": "Financial instruments (IFRS 9)
C1.Financial assets
C1.1.Classification, initial recognition and subsequent measurement
At the initial recognition, financial assets are classified into one of the following categories:
\u2013\u201cFinancial assets at amortised cost\u201d;
\u2013\u201cFinancial assets at fair value through other comprehensive income\u201d; or,
\u2013\u201cFinancial assets at fair value through profit or loss\u201d.
The classification is made taking into consideration the following aspects:
\u2013the Group's business model for the management of the financial asset; and,
\u2013the characteristics of the contractual cash flows of the financial asset.
Business Model Evaluation
With reference to 1 January 2018, the Group carried out an evaluation of the business model in which the financial
instruments are held at portfolio level, since this approach reflects how assets are managed and how that information
is made available to management bodies. The information considered in this evaluation included:
\u2013the policies and purposes established for the portfolio and the practical operability of these policies, including how
the management strategy focuses on receiving contractual interest, maintaining a certain interest rate profile,
adjusting the duration of financial assets to the duration of liabilities that finance these assets or on the realization
of cash flows through the sale of the assets;
\u2013how the performance of the portfolio is evaluated and reported to the Group's management bodies;
\u2013the evaluation of the risks that affect the performance of the business model (and of the financial assets held under
this business model) and the way these risks are managed;
\u2013the remuneration of business managers, i.e., in what way the compensation depends on the fair value of the assets
under management or on contractual cash flows received; and,
\u2013the frequency, volume and sales periodicity in previous periods, the reasons for these sales and the expectations
about future sales. However, sales information should not be considered individually, but as part of an overall
assessment of how the Group establishes financial asset management objectives and how cash flows are obtained.
Financial assets held for trading and financial assets managed and evaluated at fair value by option are measured at
fair value through profit or loss because they are not held either for the collection of contractual cash flows (HTC), nor
for the collection of cash flows and sale of these financial assets (HTC and Sell).
Evaluation if the contractual cash flows correspond to Solely Payments of Principal and Interest (SPPI)
For the purposes of this assessment, \"principal\" is defined as the fair value of the financial asset at initial recognition.
\"Interest\" is defined as the counterparty for the time value of money, for the credit risk associated with the amount
owed over a given period and for other risks and costs associated with the activity (e.g., liquidity risk and
administrative costs), as well as for a profit margin.
In the evaluation of the financial instruments in which contractual cash flows refer exclusively to the receipt of
principal and interest, the Group considered the original contractual terms of the instrument. This evaluation included
the analysis of the existence of situations in which the contractual terms can modify the periodicity and the amount of
the cash flows so that they do not fulfil the SPPI condition. In the evaluation process, the Group considered:
\u2013contingent events that may change the periodicity and the amount of the cash flows;
\u2013characteristics that result in leverage;
\u2013terms of prepayment and extension of maturity;
\u2013terms that may limit the right of the Group to claim cash flows in relation to specific assets (e.g., contracts with
terms that prevent access to assets in case of default \u2013 non-recourse asset); and,
\u2013characteristics that may change the time value of money.
In addition, an advance payment is consistent with the SPPI criterion if:
\u2013the financial asset is acquired or originated with a premium or discount in relation to the contractual nominal value;
\u2013the prepayment represents substantially the nominal amount of the contract plus accrued contractual interest, but
not paid (may include reasonable compensation for prepayment); and,
\u2013the prepaid fair value is insignificant at initial recognition.
C1.1.1.Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following conditions
are met:
\u2013the financial asset is held within a business model whose objective is to hold financial assets in order to collect their
contractual cash flows; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and advances
to customers and debt instruments managed based on a business model whose purpose is to receive their contractual
cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
C1.1.2.Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive income\"
if both of the following conditions are met:
\u2013the financial asset is held within a business model whose objective is both to collect its contractual cash flows and
to sell this financial asset; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent retribution
recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may irrevocably choose to
classify it in the category of \"Financial assets at fair value through other comprehensive income\" (FVOCI). This option is
exercised on a case-by-case basis and is only available for financial instruments that comply with the definition of
equity instruments provided in IAS 32 and cannot be used for financial instruments whose classification as an equity
instrument under the scope of the issuer is made under the exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
C1.1.3.Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
C1.2.Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management has
changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including the
ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other comprehensive income is
not allowed, nor of financial instruments designated at fair value through profit or loss.
C1.3.Modification and derecognition of financial assets
General principles
i)The Group shall derecognise a financial asset when, and only when:
\u2013the contractual rights to the cash flows from the financial asset expire; or,
\u2013it transfers the financial asset as set out in notes ii) and iii) below and the transfer qualifies for derecognition in
accordance with note iv).
ii)The Group transfers a financial asset if, and only if, it either:
\u2013transfers the contractual rights to receive the cash flows of the financial asset; or,
\u2013retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to
pay the cash flows to one or more recipients in an arrangement that meets the conditions presented in note iii).
iii)When the Group retains the contractual rights to receive the cash flows of a financial asset (the 'original asset'), but
assumes a contractual obligation to pay these cash flows to one or more entities (the 'eventual recipients'), the
Group shall treat the transaction as a transfer of a financial asset if all the following three conditions are met:
\u2013the Group does not have any obligation to pay amounts to the eventual recipients, unless it collects equivalent
amounts from the original asset. Short-term advances with the right of full recovery of the amount lent, plus
accrued interest at market rates, do not violate this condition;
\u2013the Group is contractually prohibited from selling or pledging the original asset other than as a security to the
eventual recipients due its obligation to pay them cash flows; and,
\u2013the Group has an obligation to remit any cash flows it collects on behalf of the eventual recipients without material
delay. In addition, it is not entitled to reinvest such cash flows, except for investments in cash or cash equivalents
(as defined in IAS 7 \u2013 Statement of Cash Flows) during the short settlement period from the collection date until the
date of required remittance to the eventual recipients, and interest earned on such investments is passed to the
eventual recipients.
iv) When the Group transfers a financial asset (see note ii) above), it shall evaluate the extent to which it retains the
risks and benefits arising from owning the financial asset. In this case:
\u2013if the Group transfers substantially all the risks and benefits arising from owning the financial asset, it shall
derecognise the financial asset and recognise separately any rights and obligations created or retained in the
transfer, as assets or liabilities;
\u2013if the Group retains substantially all the risks and benefits arising from owning the financial asset, it shall continue
to recognise the financial asset;
\u2013if the Group neither transfers nor retains substantially all the risks and benefits arising from owning the financial
asset, it shall determine whether it retained control of the financial asset. In this case:
a)if the Group did not retain control, it shall derecognise the financial asset and recognise separately, as assets or
liabilities, any rights and obligations created or retained in the transfer;
b)if the Group retained control, it shall continue to recognise the financial asset to the extent of its continued
involvement in the financial asset.
v)\u00a0 The transfer of risks and benefits (see prior note) is evaluated by comparing the Group\u2019s exposure, before and after
the transfer, with the variability in the amounts and timing of the net cash flows of the transferred asset.
vi) The question of whether the Group retained or not control (see note iv) above) over the transferred asset depends
on the transferee's ability to sell the asset. If the transferee has the practical ability to sell the asset in its entirety
to an unrelated third party and can exercise that ability unilaterally without needing to impose additional
restrictions on the transfer, the entity did not retain control. In all other cases, the entity retained control.
Derecognition criteria
In the context of the general principles listed in the previous section, and considering that contract modification
processes may lead, in some circumstances, to the derecognition of the original financial assets and recognition of new
ones (subject to POCI identification), the purpose of this section is to set the criteria and circumstances that may lead
to the derecognition of a financial asset.
The Bank considers that a modification of the terms and conditions of a credit exposure will result in derecognition of
the transaction and in recognition of a new transaction when the modification translates into at least one of the
following conditions:
\u2013creation of a new exposure that results from a debt consolidation, without any any of the derecognized instruments
having a nominal value higher than 90% of the nominal amount of the new instrument;
\u2013Double extension of the residual maturity, provided that the extension is not shorter than 3 years compared to the
residual maturity in the moment of the modification;
\u2013Increase of on balance exposure by more than 10% compared to the nominal amount (refers to the last approved
amount on the operation subject to modification);
\u2013Change in qualitative features, namely:
i) Change of currency, unless the exchange rate between the old and the new currency is pegged or managed
within limits restricted by law or the relevant monetary authorities;
ii) Exclusion or addition of a substantial equity conversion feature to a debt instrument, unless it is not
reasonably possible that it will be exercised over its term;
iii) Transfer of the instrument\u2019s credit risk to another borrower, or a significant change in the structure of
borrowers within the instrument.
iv) Deletion or addition to the debt instrument of features of the \"Pay If You Can\" type or dependent on the
financial performance of the debt instrument.
In the case of a restructuring due to financial difficulties of the debtor, only the criteria set out in items ii, iii and iv of
the above paragraph should be checked (the other criteria listed in this paragraph are not relevant in such situations).
Under the regulatory changes that occurred in Poland described in note 48 and those negotiated with customers holding
mortgage loans in foreign currency described in note 57, and which correspond to contractual modifications made in
accordance with IFRS 9, when the cash flows resulting from the agreement are subject to modification and a given
asset is not derecognised, Bank Millennium adjusts the gross book value of the financial asset and recognises the profit
or loss due to the modification in the Income Statement - Results on modification. The adjustment to the gross carrying
amount of a financial asset is the difference between the discounted cash flows before and after contract modification.
Loans written-off
The Group writes off a loan when it does not have reasonable expectations of recovering a financial asset in its entirety
or partially. Loans written-off are recognised in off-balance sheet accounts.
C1.4.Purchased or originated credit-impaired assets
Purchased or originated credit-impaired (POCI) assets are assets that present objective evidence of credit impairment
in the moment of their initial recognition. An asset is credit-impaired if one or more events have occurred with a
negative impact on the estimated future cash flows of the asset.
The two events that lead to the origin of a POCI exposure are presented as follows:
\u2013financial assets arising from a recovery process, where there have been changes to the terms and conditions of the
original agreement, which presented objective evidence of impairment that resulted in its derecognition (note C1.3)
and recognition of a new contract that reflects the credit losses incurred;
\u2013financial assets acquired with a significant discount, where the existence of a significant discount reflects credit
losses incurred at the time of their initial recognition.
At initial recognition, POCI assets do not carry an impairment allowance. Instead, lifetime expected credit losses (ECL)
are incorporated into the calculation of the effective interest rate (EIR). Consequently, at initial recognition, the gross
book value of POCI (initial balance) is accounted for at fair value and it's equal to the net book value before being
recognised as POCI (difference between the initial balance and the total discounted cash flows).
C1.5.Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2.Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the income
statement under \"Impairment of financial assets at fair value through other comprehensive income\", against other
comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3.Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are recognised in
liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other provisions\" (in the
income statement).
C1.5.2.Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
C1.5.3.Significant increase in credit risk (SICR)
Significant increase in credit risk (SICR) is determined according to a set of mostly quantitative, but also qualitative
criteria. These criteria are mainly based on the risk grades of customers, according to the Bank's Rating Master Scale,
and on its evolution, in order to detect significant increases in Probability of Default (PD), complemented by other
information regarding the customers\u2019 behaviour towards the financial system.
C1.5.4.Definition of financial assets in default and impaired
All customers who meet at least one of the following conditions are marked as default and, consequently, in NPE:
a) Delay over 90 days of material payment:
- Amounts of principal, interest or fees not paid on the due date that, cumulatively, represent:
i) more than Euros 100 (retail) or more than Euros 500 (non-retail); and,
ii) more than 1% of the total debt (direct liabilities).
After these two conditions are met, the counting of days of delay begins: if more than 90 consecutive days in which the
customer is in this situation have been counted, it is classified as default (or GR15).
The existence of a material payment delay gives rise to the default setting (GR15) of all holders of the operation (or
operations).
b) Signs of low probability of payment:
i.Credit restructuring due to financial difficulties with loss of value;
ii.Delay after restructuring due to financial difficulties;
iii.Recurrence of restructuring due to financial difficulties;
iv.Credit with signs of impairment (or stage 3 of IFRS 9);
v.Insolvency or equivalent proceedings;
vi.Litigation;
vii.Guarantees of operations in default;
viii.Credit sales with losses;
ix.Credit fraud;
x.Unpaid credit status;
xi.Breach of covenants in a credit agreement;
xii.Spread of default in an economic group;
xiii.Cross default in BCP Group.
C1.5.5.Estimates of expected credit losses - Individual analysis
1.Customers who are in one of the following conditions are subject to individual analysis:
Customers in default
Customers in litigation or insolvency, if the total exposure of the group members in these situations exceeds
Euros 1 million
Customers integrated into groups with an exposure over Euros 5 million, if they have a risk grade 15
Groups or customers
who are not in
default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over Euros 5 million, if a group member has a risk grade 14
Groups or customers with an exposure over Euros 5 million, if a member of the group has a restructured loan
and a risk grade 13
Groups or customers with an exposure over Euros 10 million, if at least one member of the group is in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds Euros 25 million
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
6.Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery period
to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk Office as
part of the regular process of collecting information, accompanied by detailed justification of the proposed
impairment.
7.The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be a
weighted rate considering the different recovery prospects for each part of the customer's liabilities.
8.The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualized perspective, the latter when cases that, due to their specificity, have a
high degree of uncertainty regarding the expected recovery estimation are identified.
9.The macroeconomic adjustment set out in point 8 should be analysed annually and weighted according to the type
of recovery strategy associated with the exposure under analysis:
\u2013for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global way,
to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one scenario;
\u2013for Gone Concern strategies (i.e., the recovery estimation is based on the realization of the collateral), the impact
of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the projected real
estate index indicates significant changes ahead for the current valuation values.
10.It is the responsibility of the units referred to in point 5 to consider in their projection macroeconomic expectations
that may influence the recoverability of the debt.
11.For the purposes of the preceding paragraphs, the Economic Studies, Sustainability and Cryptoassets Department
shall disclose the macroeconomic data that allow the estimations to be made.
12.The decision to consider global impacts related to the going and gone concern scenarios should be made by the Risk
Committee, as proposed by the Risk Office.
13.For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be considered
casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013recovery of collateral in geographies in which the Bank has no relevant recovery experience;
\u2013recovery of debt related to geographies in which there is strong political instability;
\u2013recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013recovery of debt related to debtors for whom there is a strong negative public exposure.
14. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
15.Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 12 of the Master Scale.
16.The individual impairment analysis must be carried out at least annually. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to promote
the review of the expected impairment of this customer.
C1.5.6.Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis are grouped considering their risk characteristics
and subject to a collective impairment analysis. The Group's credit portfolio is divided by internal risk grades and
according to the following segments:
a)Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project finance,
Institutions (banks/financial institutions) and Sovereigns;
b)Segments not \u2018low default\u2019: - Retail: Mortgages; Overdrafts; Credit cards; Small and medium enterprises - Retail
(\u2018SME Retail\u2019); and Others - Corporate: Small and medium enterprises - Corporate (\u2018Large SME\u2019); and Real Estate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013financial assets with no signs of impairment at the reporting date: the present value of the difference between the
contractual cash flows and the cash flows that the Group expects to receive;
\u2013financial assets with impairment at the reporting date: the difference between the gross book value and the present
value of the estimated cash flows;
\u2013unused credit commitments: the present value of the difference between the resulting contractual cash flows if the
commitment is made and the cash flows that the Group expects to receive;
\u2013financial guarantees: the current value of the expected repayments less the amounts that the Group expects to
recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013Probability of Default \u2013 PD;
\u2013Loss Given Default \u2013 LGD; and,
\u2013Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering the
already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These models
are based on internal data including both quantitative and qualitative factors. If there is a change in the risk of the
counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated considering the
contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates the
LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models consider
the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs. In the case
of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of high relevance
in the determination of LGD.
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD values
from the counterparty's current exposure and potential changes to its current value as a result of the contractual
conditions, including amortisations and prepayments. For commitments and financial guarantees, the value of the EAD
will consider both the amount of credit used and the expectation of future potential value that may be used in
accordance with the agreement.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a longer
period. The maximum contractual period shall be considered as the period up to the date on which the Group has the
right to require payment or end the commitment or guarantee.
The Group adopted as a residual term criterion for renewable operations, when in stage 2, a term of 5 years. This term
was determined based on the behavioural models of this type of product applied by the Bank in the liquidity risk and
interest rate (ALM) analysis. According to these models, the maximum period of repayment of these operations is the 5
years considered conservatively in the scope of the calculation of credit impairment.
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-looking
information is carried out in the relevant elements considered for the calculation of expected credit losses (ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing exposures
at the reference date becoming defaulted exposures considers the expected values for a set of macroeconomic
variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the Bank's Economic Studies
area. These scenarios, which are used across the Bank for various purposes besides calculating impairment, consider
existing projections by reference entities.
In December 2022 the Bank carried out an update of the macroeconomic scenarios and of the corresponded adjustment
of the parameters considered in the collective impairment model.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-571": { "value": "Financial assets at amortised cost
Classification
A financial asset is classified under the category \"Financial assets at amortised cost\" if both of the following conditions
are met:
\u2013the financial asset is held within a business model whose objective is to hold financial assets in order to collect their
contractual cash flows; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
The \"Financial assets at amortised cost\" category includes loans and advances to credit institutions, loans and advances
to customers and debt instruments managed based on a business model whose purpose is to receive their contractual
cash flows (government bonds, bonds issued by companies and commercial paper).
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
C1.1.2.Financial assets at fair value through other comprehensive income
Classification
A financial asset is classified under the category of \"Financial assets at fair value through other comprehensive income\"
if both of the following conditions are met:
\u2013the financial asset is held within a business model whose objective is both to collect its contractual cash flows and
to sell this financial asset; and,
\u2013its contractual cash flows occur on specific dates and are solely payments of principal and interest on the principal
amount outstanding (SPPI).
In addition, at the initial recognition of an equity instrument that is not held for trading, nor a contingent retribution
recognised by an acquirer in a business combination to which IFRS 3 applies, the Group may irrevocably choose to
classify it in the category of \"Financial assets at fair value through other comprehensive income\" (FVOCI). This option is
exercised on a case-by-case basis and is only available for financial instruments that comply with the definition of
equity instruments provided in IAS 32 and cannot be used for financial instruments whose classification as an equity
instrument under the scope of the issuer is made under the exceptions provided in paragraphs 16A to 16D of IAS 32.
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
C1.1.3.Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
Recognition of income from services and commissions
In accordance with IFRS 15, the Bank recognizes revenue associated with services and commissions when (or as) a
performance obligation is satisfied when transferring a service, based on the transaction price associated with this
performance obligation. In this context, the Bank takes the following steps to recognize revenue associated with
services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the service
provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations associated with
each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also considering the
contractual terms established with the counterparty. According to this definition, a service is transferred when the
customer obtains the benefits and control associated with the service provided. In this context, the Bank also identifies
whether performance obligations are met over time (\u201cover time\u201d) or at an exact moment (\u201cpoint in time\u201d), with
revenue being recognized accordingly.
- Measurement (price to be recognized associated with each performance obligation): (i) determine the transaction
price associated with the service provided, considering the contractual terms established with the counterparty and its
usual commercial practices. The transaction price is the amount of consideration to which the Bank expects to be
entitled in exchange for transferring promised services to the customer, excluding amounts collected on behalf of third
parties. The Bank includes in the transaction price part or all of the estimated amount of the variable consideration
associated with a performance obligation, only to the extent that it is highly probable that a significant reversal in the
amount of the accrued revenue recognized will not occur when the uncertainty associated with that variable
consideration is subsequently resolved; and (ii) allocate the transaction price to each of the performance obligations
identified under the contract established with the customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a financial
instrument, income resulting from services and commissions is recorded in net interest income (Note C.3).
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRecognitionOfRevenue", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-572": { "value": "
Initial recognition and subsequent measurement
Loans and advances to credit institutions and loans and advances to customers are recognised at the date the funds are
made available to the counterparty (settlement date). Debt instruments are recognised on the trade date, that is, on
the date the Group accepts to acquire them.
Financial assets at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. In addition, they are subject, at their initial recognition, to the measurement of
impairment losses for expected credit losses (note C1.5), which are recognised in \"'Impairment of financial assets
measured at amortised cost\".
Interest of financial assets at amortised cost is recognised under \"Interest and similar income\", based on the effective
interest rate method and in accordance with the criteria described in note C3.
Gains or losses generated at the time of derecognition are registered in \"Gains/(losses) with derecognition of financial
assets and liabilities at amortised cost\".
Initial recognition and subsequent measurement
Debt instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. Changes in the fair value of these financial assets are
recognised against other comprehensive income and, at the time of their disposal, the respective gains or losses
accumulated in other comprehensive income are reclassified to a specific income statement item designated \"Gains or
losses on derecognition of financial assets at fair value through other comprehensive income\u201d.
Debt instruments at fair value through other comprehensive income are also subject, from their initial recognition, to
the measurement of impairment losses for expected credit losses (note C1.5). Impairment losses are recognised in the
income statement under \"Impairment of financial assets at fair value through other comprehensive income\", against
\u201cOther comprehensive income\u201d, and do not reduce the carrying amount of the financial asset in the balance sheet.
Interest, premiums or discounts on financial assets at fair value through other comprehensive income are recognised in
\"Interest and similar income\", based on the effective interest rate method and in accordance with the criteria described
in note C3.
Equity instruments at fair value through other comprehensive income are initially recognised at fair value plus
transaction costs and are subsequently measured at fair value. The changes in the fair value of these financial assets
are recognised against \u201cOther comprehensive income\u201d. Dividends are recognised in the income statement when the
right to receive them is attributed.
Impairment is not recognised for equity instruments at fair value through other comprehensive income, and the
respective accumulated gains or losses recognised in \u201cFair value changes\u201d are transferred to \u201cRetained earnings\u201d at the
time of their derecognition.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRecognisingDifferenceBetweenFairValueAtInitialRecognitionAndAmountDeterminedUsingValuationTechniqueExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-573": { "value": "Financial assets at fair value through profit or loss
Classification
A financial asset is classified in the category \"Financial assets at fair value through profit and loss\" if the business model
defined by the Group for its management or the characteristics of its contractual cash flows do not meet the conditions
described above to be measured at amortised cost or at fair value through other comprehensive income (FVOCI).
In addition, the Group may irrevocably designate a financial asset at fair value through profit or loss that meets the
criteria to be measured at amortised cost or at FVOCI at the time of its initial recognition if this eliminates or
significantly reduces an inconsistency in measurement or recognition (accounting mismatch), that will otherwise arise
from measuring assets or liabilities or recognising their gains and losses in different bases.
The Group classified \"Financial assets at fair value through profit and loss\" in the following items:
a)\u201cFinancial assets held for trading\u201d
These financial assets are acquired with the purpose of short-term selling; at the initial recognition, they are part of a
portfolio of identified financial instruments and for which there is evidence of profit-taking in the short-term; or they
can be defined as derivatives (except for hedging derivatives).
b)\u201cFinancial assets not held for trading mandatorily at fair value through profit or loss\u201d
This item classifies debt instruments whose contractual cash flows do not correspond only to repayments of principal
and interest on the principal amount outstanding (SPPI).
c)\u201cFinancial assets designated at fair value through profit or loss\u201d
This item includes the financial assets that the Group has chosen to designate at fair value through profit or loss to
eliminate accounting mismatch.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are in market conditions,
financial assets at fair value through profit or loss are initially recognised at their fair value, with the costs or income
associated with the transactions recognised in profit and loss at the initial moment. Subsequent changes in the fair
value of these assets are recognised in profit and loss.
The accrual of interest and of the premium/discount (when applicable) is recognised in \"Net interest income\", based on
the effective interest rate of each transaction, except the accrual of interest from trading derivatives that are
recognised in \u201cGains/(losses) on financial operations at fair value through profit or loss\u201d. Dividends are recognised in
profit and loss when the right to receive them is attributed.
Trading derivatives with a positive fair value are included in the item \"Financial assets held for trading\", while trading
derivatives with negative fair value are included in \"Financial liabilities held for trading\".
Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a)\u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that form
part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a
recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as hedging
instrument).
b)\u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in market
conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with the costs or
income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of
that liability shall be presented in other comprehensive income;
\u2013the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest expense and similar
charges\" based on the effective interest rate of each transaction.
Gains/(losses) on financial operations at fair value through profit or loss, Foreign exchange
gains/(losses), Hedge accounting gains/(losses), Gains/(losses) from derecognition of assets
and liabilities at amortised cost and Gains/(losses) from derecognition of financial assets at
fair value through other comprehensive income
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e., fair
value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding dividends
received. This balance also includes the gains and losses on sale of financial assets at fair value through other
comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair value of
hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this balance, as well
as the foreign exchange gains or losses.
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives), financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"), whenever
these are available. If market prices are not available, fair value is estimated through numerical models based on cash-
flow discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering the
volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the available
models do not fully apply to meet the characteristics of the financial instrument, specific quotations supplied by an
external entity are applied, typically a counterparty of the business.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsAtFairValueThroughProfitOrLossExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-574": { "value": "Reclassification between categories of financial assets
Financial assets should be reclassified into other categories only if the business model used in their management has
changed. In this case, all financial assets affected must be reclassified.
The reclassification must be applied prospectively from the date of reclassification and any gains, losses (including the
ones related to impairment) or interest previously recognised should not be restated.
The reclassification of investments in equity instruments measured at fair value through other comprehensive income is
not allowed, nor of financial instruments designated at fair value through profit or loss.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForReclassificationOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-575": { "value": "Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
C1.5.1.2.Debt instruments at fair value through other comprehensive income
Impairment losses for debt instruments at fair value through other comprehensive income are recognised in the income
statement under \"Impairment of financial assets at fair value through other comprehensive income\", against other
comprehensive income (they do not reduce the balance sheet amount of these financial assets).
C1.5.1.3.Credit commitments, documentary credits and financial guarantees
Impairment losses associated with credit commitments, documentary credits and financial guarantees are recognised in
liabilities, under the balance \"Provisions for guarantees and other commitments\", against \"Other provisions\" (in the
income statement).
C1.5.2.Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
The assessment of existence of impairment losses in individual terms is determined through an analysis of the total
credit exposure on a case-by-case basis. For each loan considered individually significant, the Group assessed, at each
balance sheet date, the existence of objective evidence of impairment. In the assessment of impairment losses in
individual terms, the following factors were considered:
\u2013total exposure of each customer towards the Group and the existence of overdue loans;
\u2013viability of the customer\u2019s business and its capacity to generate enough cash flows to service debt obligations in the
future;
\u2013the existence, nature and estimated value of the collaterals associated to each loan;
\u2013significant deterioration of the customer's rating;
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
Whenever there is an indication that a fixed tangible asset might be impaired, its recoverable amount is estimated and
an impairment loss shall be recognised if the net value of the asset exceeds its recoverable amount. The recoverable
amount is determined as the highest between the fair value less costs to sell and its value in use calculated based on
the present value of future cash flows estimated to be obtained from the continued use of the asset and its sale at the
end of the useful life. The impairment losses of the fixed tangible assets are recognised in the income statement of the
period.
M.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-576": { "value": "Impairment losses
C1.5.1.Financial instruments subject to impairment losses recognition
The Group recognises impairment losses for expected credit losses on financial instruments recognised in the following
accounting items:
C1.5.1.1.Financial assets at amortised cost
Impairment losses on financial assets at amortised cost reduce the balance sheet value of these financial assets against
the item \"Impairment of financial assets at amortised cost\" (in the income statement).
Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfFinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-577": { "value": "Classification of financial instruments by stages
Changes in credit risk since the initial recognition
Stage 1
Stage 2
Stage 3
Classification criterion
Initial recognition
Significant increase in credit
risk since initial recognition
Impaired
Impairment losses
12-month expected credit
losses
Lifetime expected credit losses
The Group determines the expected credit losses of each operation as a result of the deterioration of credit risk since
its initial recognition. For this purpose, operations are classified into one of the following three stages:
\u2013Stage 1: the operations in which there is no significant increase in credit risk since its initial recognition are
classified in this stage. Impairment losses associated with operations classified in this stage correspond to expected
credit losses resulting from a default event that may occur within 12 months after the reporting date (12-month
expected credit losses);
\u2013Stage 2: the operations in which there is a significant increase in credit risk since its initial recognition (note C1.5.3)
but are not impaired (note C1.5.4) are classified in this stage. Impairment losses associated with operations
classified in this stage correspond to the expected credit losses resulting from default events that may occur over
the expected residual life of the operations (lifetime expected credit losses);
\u2013Stage 3: impaired operations are classified in this stage. Impairment losses associated with operations classified at
this stage correspond to lifetime expected credit losses.
C1.5.3.Significant increase in credit risk (SICR)
Significant increase in credit risk (SICR) is determined according to a set of mostly quantitative, but also qualitative
criteria. These criteria are mainly based on the risk grades of customers, according to the Bank's Rating Master Scale,
and on its evolution, in order to detect significant increases in Probability of Default (PD), complemented by other
information regarding the customers\u2019 behaviour towards the financial system.
C1.5.4.
Credit Risk
Credit granting is based on a prior classification of the customers\u2019 risk and on a thorough assessment of the level of
protection provided by the underlying collateral. In order to do so, a single risk-notation system has been introduced,
the Rating Master Scale, based on the expected probability of default, allowing greater discrimination in the
assessment of the customers and better establishment of the hierarchies of the associated risk.
The Rating Master Scale also identifies those customers that show a worsening credit capacity and, in particular, those
classified as being in default. All rating and scoring models used by the Group have been duly calibrated for the Rating
Master Scale. The protection-level concept has been introduced as a crucial element of evaluation of the effectiveness
of the collateral in credit-risk mitigation, leading to a more active collateralization of loans and to a better adequacy
of pricing regarding the risk incurred.
The gross Group\u2019s exposure to credit risk (original exposure) is presented in the following table:
(Thousands of euros)
Risk items
2022
2021
Central Governments or Central Banks
22,898,387
24,942,714
Regional Governments or Local Authorities
1,012,723
1,243,453
Administrative and non-profit Organisations
412,223
462,481
Multilateral Development Banks
114,633
18,790
Other Credit Institutions
3,279,977
2,777,375
Retail and Corporate customers
69,798,319
71,911,594
Other items (*)
10,153,154
8,562,386
107,669,416
109,918,793
Note: gross exposures of impairment and amortization, in accordance with the prudential consolidation perimeter. Includes
securitization positions.
(*) In addition to positions in equity, collective investment and securitization, the Other items contain other assets subject to credit
risk in accordance with Article 134 of the CRR.
The evaluation of the risk associated to the loan portfolio and quantification of the respective losses expected
considers the following methodological notes.
a) Collaterals and Guarantees
On the risk evaluation of an operation or of a group of operations, the mitigation elements of credit risk associated to
those operations are considered in accordance with the rules and internal procedures that fulfil the requirements
defined by the regulations in force, also reflecting the experience of the loan's recovery areas and the Legal
Department opinions with respect to the entailment of the various mitigation instruments.
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 7 or better on the Rating Master Scale;
- personal guarantees when the persons are classified with Risk Grade 7 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organized
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in restructuring
process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk Grade of
the client by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better than the client\u2019s),
when the protection is formalized through:
- State, Financial Institutions or Mutual Guarantee Societies guarantees exist;
- personal guarantees (or, in the case of Leasing,\u00a0 there is a recovery agreement of the provider);
- Credit derivatives;
- Formalization of the clause of the contracting party in leasing contracts in which it is an entity that is in a relationship
of dominion or group with the lessee.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis and
before decision process.
Either the initial evaluations or the subsequent reviews carried out are performed by external expert valuers and the
ratification process is centralized in the Appraisals Unit, which is independent of the clients\u2019 areas.
In any case, they are the subject to a written report, in a standardized digital format, based on a group of predefined
methods that are aligned with the sector practices \u2013 income, replacement cost and/or market comparative -
mentioning the obtained value, for both the market value and for purposes of the mortgage guarantee, depending on
the type of the real estate. The evaluations have a declaration/certification of an expert valuer since 2008, as
requested by Regulation (EU) 575/2013 and Law 153/2015 of 14 September and are ratified by the Appraisals Unit.
Regarding residential real estate, after the initial valuation and in accordance with Notice n. 5/2006 of Bank of
Portugal and e CRR 575/2013, the Bank monitors the respective values through market indexes. If the index is lower
than 0.9, the Bank\u00a0 revaluates choosing one of the following two methods:
i) - depreciation of the property by direct application of the index, if the amount owed does not exceed Euros 300,000;
ii) - review of the property value by external valuators, depending on the value of the credit operation, and in
accordance with the established standards from ECB and Bank of Portugal.
For all non-residential real estate, the Bank also monitors its values through market indexes and to the regular
valuation reviews with the minimum periodicities in accordance with the Regulation (EU) 575/2013, in the case of
offices, commercial spaces, warehouses and industrial premises.
For all real estate (residential or non-residential) for which the monitoring result in significant devaluation of the real
estate value (more than 10%), a valuation review is subsequently carried out by an expert valuer, preserving the
referred i) above.
For the remaining real estate (land or countryside buildings for example) there are no market indexes available for the
monitoring of appraisal values, after the initial valuations. Therefore, for these cases and in accordance with the
minimum periodicity established for the monitoring and reviewing of this type of real estate, valuation reviews are
carried out by expert valuers.
The indexes currently used are supplied to the Bank by an external specialized entity that, for more than a decade, has
been collecting and processing the data upon which the indexes are built.
In the case of financial collaterals, their market value is daily and automatically updated, through the IT connection
between the collaterals management system and the relevant financial markets data.
b) Risk grades
Credit granting is based on the previous risk assessment of clients and also on a rigorous assessment of the protection
level provided by the underlying collaterals. For this purpose, a single risk grading system is used - the Rating Master
Scale - based on Probability of Default (PD), allowing for a greater discriminating power in clients' assessment and for a
better hierarchy of the associated risk. The Rating Master Scale also allows to identify clients that show signs of
degradation in their credit capacity and, in particular, those that are classified in a default situation. All rating systems
and models used by the Group were calibrated for the Rating Master Scale.
Aiming at an adequate assessment of credit risk, the Group defined a set of macro segments and segments which are
treated through different rating systems and models that relate the internal risk grades and the clients\u2019 PD, ensuring a
risk assessment that considers the clients\u2019 specific features in terms of their respectively risk profiles.
The assessment made by these rating systems and models result in the risk grades of the Master Scale, that has fifteen
grades, where the last three correspond to relevant downgrades of the clients\u2019 credit quality and are referred to by
\u201cprocedural risk grades\u201d: 13, 14 and 15, that correspond, in this order, to situations of increased severity in terms
default, as risk grade 15 is a Default situation.
The non-procedural risk grades are attributed by the rating systems through automatic decision models or by the Rating
Division \u2013 a unit which is independent from the credit analysis and decision areas and bodies- and are reviewed/updated
periodically or whenever this is justified by events.
The models within the various rating systems are regularly subject to validation, made by the Models Validation and
Monitoring Office, which is independent from the units that are responsible for the development and maintenance of
the rating models.
The conclusions of the validations by the Models Validation and Monitoring Office, as well the respective
recommendations and proposal for changes and/or improvements, are analysed and ratified by a specific Validation
Committee, composed in accordance to the type of model analysed. The proposals for models\u2019 changes originated by
the Validation Committee are submitted to the approval of the Risk Committee.
The following table lists the equivalence between the internal rating levels (Rating Master Scale) and the external
ratings of the international rating agencies:
Internal risk grade
External ratings
Fitch
S&P
Moody's
DBRS
1
AAA
AAA
Aaa
AAA
1
AA+
AA+
Aa1
AA (high)
2
AA
AA
Aa2
AA
2
AA-
AA-
Aa3
AA (low)
3
A+
A+
A1
A (high)
3
A
A
A2
A
4
A-
A-
A3
A (low)
4
BBB+
BBB+
Baa1
BBB (high)
5
BBB
BBB
Baa2
BBB
6
BBB-
BBB-
Baa3
BBB (low)
7
BB+
BB+
Ba1
BB (high)
8
BB
BB
Ba2
BB
9
BB-
BB-
Ba3
BB (low)
10
B+
B+
B1
B (high)
11
B
B
B2
B
12
\u2264 B-
\u2264 B-
\u2264 B3
\u2264 B-
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
(Thousands of euros)
Category
2022
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
862
\u2014
\u2014
\u2014
862
Loans and advances to customers (note 22)
214,470
284,448
985,557
17,898
1,502,373
Debt instruments (note 23)
13,409
720
110
\u2014
14,239
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,067
\u2014
1,067
Guarantees and other commitments (note 39) (**)
11,307
14,893
84,435
119
110,754
Total
240,048
300,061
1,071,169
18,017
1,629,295
(Thousands of euros)
Category
2022
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
963,434
\u2014
\u2014
\u2014
963,434
Loans and advances to customers (note 22)
46,181,526
7,279,787
1,185,422
29,058
54,675,793
Debt instruments (note 23)
12,976,823
55,067
3,692
\u2014
13,035,582
Debt instruments at fair value through other
comprehensive income (note 24) (*)
7,434,152
\u2014
\u2014
\u2014
7,434,152
Guarantees and other commitments (note 45) (**)
14,291,924
1,753,702
280,256
802
16,326,684
Total
81,847,859
9,088,556
1,469,370
29,860
92,435,645
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
As at 31 December 2021, the financial instruments subject to impairment requirements under IFRS 9 (do not include
equity instruments as accounting policy 1.C1.1.2, analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2021
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,287
5,113
\u2014
\u2014
454,400
Loans and advances to customers (note 22)
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Debt instruments (note 23)
8,094,290
122,257
4,451
\u2014
8,220,998
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
1,092
\u2014
12,857,257
Guarantees and other commitments (note 45) (**)
13,462,773
1,922,031
412,179
\u2014
15,796,983
Total
80,976,168
10,013,453
3,103,989
57,713
94,151,323
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
(Thousands of euros)
Category
2021
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
128
1,059
\u2014
\u2014
1,187
Loans and advances to customers (note 22)
207,328
288,642
1,336,612
16,702
1,849,284
Debt instruments (note 23)
13,187
2,517
98
\u2014
15,802
Debt instruments at fair value through other
comprehensive income (note 23) (*)
\u2014
\u2014
1,092
\u2014
1,092
Guarantees and other commitments (note 39) (**)
12,848
13,033
84,768
\u2014
110,649
Total
233,491
305,251
1,422,570
16,702
1,978,014
(Thousands of euros)
Category
2021
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,159
4,054
\u2014
\u2014
453,213
Loans and advances to customers (note 22)
45,906,325
7,675,410
1,349,655
41,011
54,972,401
Debt instruments (note 23)
8,081,103
119,740
4,353
\u2014
8,205,196
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
\u2014
\u2014
12,856,165
Guarantees and other commitments (note 45) (**)
13,449,925
1,908,998
327,411
\u2014
15,686,334
Total
80,742,677
9,708,202
1,681,419
41,011
92,173,309
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as follows:
(Thousands of euros)
2022
2021
Financial assets held for trading (note 24)
Debt instruments
338,813
452,105
Derivatives
394,183
468,642
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
504,200
881,556
Hedging derivatives (note 25)
59,703
147,570
Total
1,296,899
1,949,873
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2022, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2022
Financial assets at amortised cost - Loans and advances to customers -
Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,111,726)
2,111,726
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(258,614)
\u2014
258,614
\u2014
\u2014
Transfers from stage 2 to stage 1
1,946,027
(1,946,027)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(631,859)
631,859
\u2014
\u2014
Transfers from stage 3 to stage 1
26,176
\u2014
(26,176)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
174,249
(174,249)
\u2014
\u2014
Write-offs
(922)
(2,996)
(440,667)
(13,820)
(458,405)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
681,402
(104,910)
(764,669)
3,063
(185,114)
Gross amount at the end of the year
46,395,996
7,564,235
2,170,979
46,956
56,178,166
During 2021, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2021
Financial assets at amortised cost - Loans and advances to customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Other (1)
Total
Gross amount as at 1 January
43,702,669
7,179,503
3,188,808
86,357
(98,458)
54,058,879
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,234,691)
2,234,691
\u2014
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(228,197)
\u2014
228,197
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 1
1,691,534
(1,691,534)
\u2014
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(339,863)
339,863
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 1
30,124
\u2014
(30,124)
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
121,048
(121,048)
\u2014
\u2014
\u2014
Write-offs
(3,261)
(2,370)
(362,075)
(5,004)
\u2014
(372,710)
Net balance of new financial assets and
derecognised financial assets and other
variations
3,509,575
462,577
(557,354)
(23,640)
98,458
3,489,616
Transfers resulting from changes in the
Group's structure (Banque Priv\u00e9e BCP
(Suisse))
(354,100)
\u2014
\u2014
\u2014
\u2014
(354,100)
Gross amount at the end of the year
46,113,653
7,964,052
2,686,267
57,713
\u2014
56,821,685
(Banque Priv\u00e9e BCP (Suisse))
(368)
\u2014
\u2014
\u2014
(368)
Impairment losses at the end of the year
207,328
288,642
1,336,612
16,702
1,849,284
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based on
expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2022
2021
Amortised cost before changes
396,049
612,501
Impairment losses before changes
(47,337)
(87,268)
Net amortised cost before changes
348,712
525,233
Net gain/loss arising on changes
(32,993)
(7,949)
Net amortised cost after changes
315,719
517,284
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,213,881
2,320,624
151,906
89,857
2,562,387
284,276
142,817
427,093
10,525
28,213,886
Individuals-Other
7,614,004
958,714
118,276
42,895
1,119,885
252,456
284,486
536,942
19,621
9,290,452
Financial Companies
3,569,566
80,945
61
\u2014
81,006
72,980
1,494
74,474
7,545
3,732,591
Non-financial companies - Corporate
9,621,830
700,538
660
13
701,211
204,523
91,575
296,098
\u2014
10,619,139
Non-financial companies - SME-
Corporate
10,238,522
2,798,567
5,339
2,559
2,806,465
761,101
95,135
856,236
6,733
13,907,956
Non-financial companies -SME-Retail
6,024,603
1,683,407
30,867
14,532
1,728,806
231,377
117,109
348,486
3,453
8,105,348
Non-financial companies -Other
558,812
46,613
2
\u2014
46,615
113
\u2014
113
\u2014
605,540
Other loans
11,812,537
342,203
39
\u2014
342,242
\u2014
30
30
\u2014
12,154,809
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Individuals-Mortgage
15,380
23,667
4,083
5,262
33,012
56,519
56,440
112,959
5,452
166,803
Individuals-Other
52,559
31,277
18,676
11,224
61,177
104,108
180,916
285,024
12,436
411,196
Financial Companies
8,491
1,701
4
\u2014
1,705
36,543
1,245
37,788
\u2014
47,984
Non-financial companies - Corporate
27,484
18,218
22
\u2014
18,240
87,043
43,500
130,543
\u2014
176,267
Non-financial companies - SME-
Corporate
46,296
81,667
506
660
82,833
298,455
46,890
345,345
129
474,603
Non-financial companies -SME-Retail
78,239
92,784
4,090
3,226
100,100
106,533
51,896
158,429
\u2014
336,768
Non-financial companies -Other
512
129
\u2014
\u2014
129
5
\u2014
5
\u2014
646
Other loans
11,087
2,860
5
\u2014
2,865
\u2014
9
9
\u2014
13,961
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Individuals-Mortgage
25,198,501
2,296,957
147,823
84,595
2,529,375
227,757
86,377
314,134
5,073
28,047,083
Individuals-Other
7,561,445
927,437
99,600
31,671
1,058,708
148,348
103,570
251,918
7,185
8,879,256
Financial Companies
3,561,075
79,244
57
\u2014
79,301
36,437
249
36,686
7,545
3,684,607
Non-financial companies - Corporate
9,594,346
682,320
638
13
682,971
117,480
48,075
165,555
\u2014
10,442,872
Non-financial companies - SME-
Corporate
10,192,226
2,716,900
4,833
1,899
2,723,632
462,646
48,245
510,891
6,604
13,433,353
Non-financial companies -SME-Retail
5,946,364
1,590,623
26,777
11,306
1,628,706
124,844
65,213
190,057
3,453
7,768,580
Non-financial companies -Other
558,300
46,484
2
\u2014
46,486
108
\u2014
108
\u2014
604,894
Other loans
11,801,450
339,343
34
\u2014
339,377
\u2014
21
21
\u2014
12,140,848
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Individuals-Mortgage
0.06%
1.02%
2.69%
5.86%
1.29%
19.88%
39.52%
26.45%
51.80%
0.59%
Individuals-Other
0.69%
3.26%
15.79%
26.17%
5.46%
41.24%
63.59%
53.08%
63.38%
4.43%
Financial Companies
0.24%
2.10%
6.56%
0.00%
2.10%
50.07%
83.33%
50.74%
0.00%
1.29%
Non-financial companies - Corporate
0.29%
2.60%
3.33%
0.00%
2.60%
42.56%
47.50%
44.09%
0.00%
1.66%
Non-financial companies - SME-
Corporate
0.45%
2.92%
9.48%
25.79%
2.95%
39.21%
49.29%
40.33%
1.92%
3.41%
Non-financial companies -SME-Retail
1.30%
5.51%
13.25%
22.20%
5.79%
46.04%
44.31%
45.46%
0.00%
4.15%
Non-financial companies -Other
0.09%
0.28%
0.00%
0.00%
0.28%
4.42%
0.00%
4.42%
0.00%
0.11%
Other loans
0.09%
0.84%
12.82%
0.00%
0.84%
0.00%
30.00%
30.00%
0.00%
0.11%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Segment
Stage 1
No delays
Days past
due <=
30 days
Days past
due > 30
days
Total
Days past
due <=
90 days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,365,328
2,305,851
126,323
66,432
2,498,606
296,980
171,593
468,573
13,320
28,345,827
Individuals-Other
7,631,117
820,962
94,862
40,061
955,885
251,607
340,511
592,118
42,163
9,221,283
Financial Companies
2,946,812
333,975
71
13
334,059
116,539
61,091
177,630
\u2014
3,458,501
Non-financial companies -
Corporate
7,994,250
920,647
436
409
921,492
209,359
365,953
575,312
\u2014
9,491,054
Non-financial companies - SME-
Corporate
9,848,761
2,914,636
8,506
2,360
2,925,502
719,045
142,057
861,102
850
13,636,215
Non-financial companies -SME-
Retail
6,469,104
2,021,279
18,127
12,285
2,051,691
329,395
98,615
428,010
1,380
8,950,185
Non-financial companies -Other
570,736
54,092
\u2014
\u2014
54,092
152
\u2014
152
\u2014
624,980
Other loans
7,293,895
272,126
\u2014
\u2014
272,126
\u2014
\u2014
\u2014
\u2014
7,566,021
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
\u2014
\u2014
Individuals-Mortgage
13,417
11,246
1,991
3,946
17,183
48,326
67,393
115,719
3,159
149,478
Individuals-Other
44,802
24,514
13,555
9,521
47,590
104,129
231,996
336,125
13,530
442,047
Financial Companies
4,990
6,966
4
3
6,973
67,871
42,746
110,617
\u2014
122,580
Non-financial companies -
Corporate
30,910
23,366
11
95
23,472
86,950
247,397
334,347
\u2014
388,729
Non-financial companies - SME-
Corporate
81,639
118,121
788
589
119,498
260,886
68,570
329,456
\u2014
530,593
Non-financial companies -SME-
Retail
47,538
82,720
2,356
2,543
87,619
143,756
51,382
195,138
13
330,308
Non-financial companies -Other
297
136
\u2014
\u2014
136
76
\u2014
76
\u2014
509
Other loans
9,898
2,780
\u2014
\u2014
2,780
\u2014
\u2014
\u2014
\u2014
12,678
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
\u2014
\u2014
Individuals-Mortgage
25,351,911
2,294,605
124,332
62,486
2,481,423
248,654
104,200
352,854
10,161
28,196,349
Individuals-Other
7,586,315
796,448
81,307
30,540
908,295
147,478
108,515
255,993
28,633
8,779,236
Financial Companies
2,941,822
327,009
67
10
327,086
48,668
18,345
67,013
\u2014
3,335,921
Non-financial companies -
Corporate
7,963,340
897,281
425
314
898,020
122,409
118,556
240,965
\u2014
9,102,325
Non-financial companies - SME-
Corporate
9,767,122
2,796,515
7,718
1,771
2,806,004
458,159
73,487
531,646
850
13,105,622
Non-financial companies -SME-
Retail
6,421,566
1,938,559
15,771
9,742
1,964,072
185,639
47,233
232,872
1,367
8,619,877
Non-financial companies -Other
570,439
53,956
\u2014
\u2014
53,956
76
\u2014
76
\u2014
624,471
Other loans
7,283,997
269,346
\u2014
\u2014
269,346
\u2014
\u2014
\u2014
\u2014
7,553,343
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Individuals-Mortgage
0.05%
0.49%
1.58%
5.94%
0.69%
16.27%
39.27%
24.70%
23.72%
0.53%
Individuals-Other
0.59%
2.99%
14.29%
23.77%
4.98%
41.39%
68.13%
56.77%
32.09%
4.79%
Financial Companies
0.17%
2.09%
5.63%
23.08%
2.09%
58.24%
69.97%
62.27%
0.00%
3.54%
Non-financial companies -
Corporate
0.39%
2.54%
2.52%
23.23%
2.55%
41.53%
67.60%
58.12%
0.00%
4.10%
Non-financial companies - SME-
Corporate
0.83%
4.05%
9.26%
24.96%
4.08%
36.28%
48.27%
38.26%
0.00%
3.89%
Non-financial companies -SME-
Retail
0.73%
4.09%
13.00%
20.70%
4.27%
43.64%
52.10%
45.59%
0.94%
3.69%
Non-financial companies -Other
0.05%
0.25%
0.00%
0.00%
0.25%
50.00%
0.00%
50.00%
0.00%
0.08%
Other loans
0.14%
1.02%
0.00%
0.00%
1.02%
0.00%
0.00%
0.00%
0.00%
0.17%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,827,885
3,279,338
270,182
132,752
3,682,272
536,732
427,303
964,035
30,146
37,504,338
Non-financial companies - Trade
5,312,463
827,990
9,921
4,283
842,194
91,204
45,688
136,892
4,715
6,296,264
Non-financial companies -
Construction
2,010,021
771,490
3,040
1,033
775,563
363,418
32,791
396,209
1,851
3,183,644
Non-financial companies -
Manufacturing industries
5,836,145
1,013,888
9,380
4,983
1,028,251
162,228
117,804
280,032
928
7,145,356
Non-financial companies -Other
activities
2,107,745
395,981
3,587
1,007
400,575
101,252
17,354
118,606
44
2,626,970
Non-financial companies - Other
services
11,177,393
2,219,776
10,940
5,798
2,236,514
479,012
90,182
569,194
2,648
13,985,749
Other Services /Other activities
15,382,103
423,148
100
\u2014
423,248
72,980
1,524
74,504
7,545
15,887,400
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
\u2014
\u2014
\u2014
Loans to individuals
67,939
54,944
22,759
16,486
94,189
160,627
237,356
397,983
17,888
577,999
Non-financial companies - Trade
22,306
26,555
1,168
1,110
28,833
35,530
20,294
55,824
129
107,092
Non-financial companies -
Construction
11,517
16,055
551
288
16,894
154,391
18,769
173,160
\u2014
201,571
Non-financial companies -
Manufacturing industries
54,925
54,821
1,293
1,258
57,372
65,474
58,761
124,235
\u2014
236,532
Non-financial companies -Other
activities
7,701
15,667
529
154
16,350
44,356
8,459
52,815
\u2014
76,866
Non-financial companies - Other
services
56,082
79,700
1,077
1,076
81,853
192,285
36,003
228,288
\u2014
366,223
Other Services /Other activities
19,578
4,561
9
\u2014
4,570
36,543
1,254
37,797
\u2014
61,945
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Loans to individuals
32,759,946
3,224,394
247,423
116,266
3,588,083
376,105
189,947
566,052
12,258
36,926,339
Non-financial companies - Trade
5,290,157
801,435
8,753
3,173
813,361
55,674
25,394
81,068
4,586
6,189,172
Non-financial companies -
Construction
1,998,504
755,435
2,489
745
758,669
209,027
14,022
223,049
1,851
2,982,073
Non-financial companies -
Manufacturing industries
5,781,220
959,067
8,087
3,725
970,879
96,754
59,043
155,797
928
6,908,824
Non-financial companies -Other
activities
2,100,044
380,314
3,058
853
384,225
56,896
8,895
65,791
44
2,550,104
Non-financial companies - Other
services
11,121,311
2,140,076
9,863
4,722
2,154,661
286,727
54,179
340,906
2,648
13,619,526
Other Services /Other activities
15,362,525
418,587
91
\u2014
418,678
36,437
270
36,707
7,545
15,825,455
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Loans to individuals
0.21%
1.68%
8.42%
12.42%
2.56%
29.93%
55.55%
41.28%
59.34%
1.54%
Non-financial companies - Trade
0.42%
3.21%
11.77%
25.92%
3.42%
38.96%
44.42%
40.78%
2.74%
1.70%
Non-financial companies -
Construction
0.57%
2.08%
18.13%
27.88%
2.18%
42.48%
57.24%
43.70%
0.00%
6.33%
Non-financial companies -
Manufacturing industries
0.94%
5.41%
13.78%
25.25%
5.58%
40.36%
49.88%
44.36%
0.00%
3.31%
Non-financial companies -Other
activities
0.37%
3.96%
14.75%
15.29%
4.08%
43.81%
48.74%
44.53%
0.00%
2.93%
Non-financial companies - Other
services
0.50%
3.59%
9.84%
18.56%
3.66%
40.14%
39.92%
40.11%
0.00%
2.62%
Other Services /Other activities
0.13%
1.08%
9.00%
0.00%
1.08%
50.07%
82.28%
50.73%
0.00%
0.39%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Sector of activity
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,996,445
3,126,813
221,185
106,493
3,454,491
548,587
512,104
1,060,691
55,483
37,567,110
Non-financial companies -
Trade
5,498,200
868,334
4,967
3,001
876,302
91,994
57,333
149,327
99
6,523,928
Non-financial companies -
Construction
1,862,344
860,822
3,450
1,790
866,062
375,867
35,275
411,142
41
3,139,589
Non-financial companies -
Manufacturing industries
5,586,843
998,335
8,412
2,987
1,009,734
171,010
119,504
290,514
92
6,887,183
Non-financial companies -
Other activities
1,665,202
452,573
618
581
453,772
174,343
85,674
260,017
19
2,379,010
Non-financial companies -
Other services
10,270,262
2,730,590
9,622
6,695
2,746,907
444,737
308,839
753,576
1,979
13,772,724
Other Services /Other
activities
10,240,707
606,101
71
13
606,185
116,539
61,091
177,630
\u2014
11,024,522
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
Loans to individuals
58,219
35,760
15,546
13,467
64,773
152,455
299,389
451,844
16,689
591,525
Non-financial companies -
Trade
29,433
28,996
529
534
30,059
33,035
37,220
70,255
\u2014
129,747
Non-financial companies -
Construction
11,855
14,740
634
389
15,763
127,891
22,655
150,546
\u2014
178,164
Non-financial companies -
Manufacturing industries
33,038
30,564
473
725
31,762
49,030
53,649
102,679
12
167,491
Non-financial companies -
Other activities
9,548
17,393
123
120
17,636
87,138
41,142
128,280
\u2014
155,464
Non-financial companies -
Other services
76,510
132,650
1,396
1,459
135,505
194,574
212,683
407,257
1
619,273
Other Services /Other
activities
14,888
9,746
4
3
9,753
67,871
42,746
110,617
\u2014
135,258
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
Loans to individuals
32,938,226
3,091,053
205,639
93,026
3,389,718
396,132
212,715
608,847
38,794
36,975,585
Non-financial companies -
Trade
5,468,767
839,338
4,438
2,467
846,243
58,959
20,113
79,072
99
6,394,181
Non-financial companies -
Construction
1,850,489
846,082
2,816
1,401
850,299
247,976
12,620
260,596
41
2,961,425
Non-financial companies -
Manufacturing industries
5,553,805
967,771
7,939
2,262
977,972
121,980
65,855
187,835
80
6,719,692
Non-financial companies -
Other activities
1,655,654
435,180
495
461
436,136
87,205
44,532
131,737
19
2,223,546
Non-financial companies -
Other services
10,193,752
2,597,940
8,226
5,236
2,611,402
250,163
96,156
346,319
1,978
13,153,451
Other Services /Other
activities
10,225,819
596,355
67
10
596,432
48,668
18,345
67,013
\u2014
10,889,264
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Loans to individuals
0.18%
1.14%
7.03%
12.65%
1.88%
27.79%
58.46%
42.60%
30.08%
1.57%
Non-financial companies -
Trade
0.54%
3.34%
10.65%
17.79%
3.43%
35.91%
64.92%
47.05%
0.00%
1.99%
Non-financial companies -
Construction
0.64%
1.71%
18.38%
21.73%
1.82%
34.03%
64.22%
36.62%
0.00%
5.67%
Non-financial companies -
Manufacturing industries
0.59%
3.06%
5.62%
24.27%
3.15%
28.67%
44.89%
35.34%
13.04%
2.43%
Non-financial companies -
Other activities
0.57%
3.84%
19.90%
20.65%
3.89%
49.98%
48.02%
49.34%
0.00%
6.53%
Non-financial companies -
Other services
0.74%
4.86%
14.51%
21.79%
4.93%
43.75%
68.87%
54.04%
0.05%
4.50%
Other Services /Other
activities
0.15%
1.61%
5.63%
23.08%
1.61%
58.24%
69.97%
62.27%
0.00%
1.23%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
54,604,642
7,155,127
159,209
66,646
7,380,982
1,410,285
306,213
1,716,498
19,011
63,721,133
Poland
18,184,099
1,377,667
142,519
81,498
1,601,684
386,990
343,753
730,743
28,866
20,545,392
Mozambique
1,865,014
398,817
5,422
1,712
405,951
9,551
82,680
92,231
\u2014
2,363,196
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Portugal
150,039
205,954
7,124
5,447
218,525
550,372
124,012
674,384
\u2014
1,042,948
Poland
83,818
42,151
19,641
14,566
76,358
136,847
210,573
347,420
18,017
525,613
Mozambique
6,191
4,198
621
359
5,178
1,987
46,311
48,298
\u2014
59,667
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Portugal
54,454,603
6,949,173
152,085
61,199
7,162,457
859,913
182,201
1,042,114
19,011
62,678,185
Poland
18,100,281
1,335,516
122,878
66,932
1,525,326
250,143
133,180
383,323
10,849
20,019,779
Mozambique
1,858,823
394,619
4,801
1,353
400,773
7,564
36,369
43,933
\u2014
2,303,529
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment
coverage
Portugal
0.27%
2.88%
4.47%
8.17%
2.96%
39.03%
40.50%
39.29%
0.00%
1.64%
Poland
0.46%
3.06%
13.78%
17.87%
4.77%
35.36%
61.26%
47.54%
62.42%
2.56%
Mozambique
0.33%
1.05%
11.45%
20.97%
1.28%
20.80%
56.01%
52.37%
0.00%
2.52%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in the
accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit lines and revocable commitments (note 45).
As at 31 December 2021, the gross exposure, by type of financial instrument, internal rating and stage, is analysed as
follows:
(Thousands of euros)
2021
Gross Exposure
Higher quality
(GR 1-6)
Average
quality
(GR 7-9)
Lower
quality
(GR 10-12)
Procedural
(GR 13/14/15)
Not classified
(without risk
grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
39,440,489
10,218,369
3,686,807
6,197
1,305,368
54,657,230
220,643
54,436,587
stage 2
1,650,754
1,832,802
3,828,897
284,265
494,703
8,091,421
292,219
7,799,202
stage 3
\u2014
\u2014
\u2014
2,690,023
695
2,690,718
1,336,710
1,354,008
POCI
3,001
2,535
1,096
51,081
1
57,714
16,702
41,012
41,094,244
12,053,706
7,516,800
3,031,566
1,800,767
65,497,083
1,866,274
63,630,809
Debt instruments at fair
value through other
comprehensive income (*)
stage 1
12,357,161
249,054
29,162
\u2014
220,790
12,856,167
\u2014
12,856,167
stage 3
\u2014
\u2014
\u2014
\u2014
1,092
1,092
1,092
\u2014
12,357,161
249,054
29,162
\u2014
221,882
12,857,259
1,092
12,856,167
Guarantees and other
commitments (**)
stage 1
8,383,240
3,632,450
1,183,525
192
263,366
13,462,773
12,848
13,449,925
stage 2
197,624
509,335
919,049
42,849
253,175
1,922,032
13,032
1,909,000
stage 3
\u2014
\u2014
\u2014
412,179
\u2014
412,179
84,768
327,411
8,580,864
4,141,785
2,102,574
455,220
516,541
15,796,984
110,648
15,686,336
Total
62,032,269
16,444,545
9,648,536
3,486,786
2,539,190
94,151,326
1,978,014
92,173,312
As at 31 December 2021, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by segment, are presented in the following
table
(Thousands of euros)
2021
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgage
46,604
28,299,223
28,345,827
14,081
135,397
149,478
Individuals - Other
30,802
9,190,481
9,221,283
18,753
423,294
442,047
Financial Companies
171,875
3,286,626
3,458,501
110,524
12,056
122,580
Non-financial companies - Corporate
520,987
8,970,067
9,491,054
325,523
63,206
388,729
Non-financial companies - SME - Corporate
650,958
12,985,257
13,636,215
290,432
240,161
530,593
Non-financial companies -SME - Retail
248,059
8,702,126
8,950,185
127,132
203,176
330,308
Non-financial companies - Other
152
624,828
624,980
76
433
509
Other loans
\u2014
7,566,021
7,566,021
\u2014
12,678
12,678
Total
1,669,437
79,624,629
81,294,066
886,521
1,090,401
1,976,922
As at 31 December 2022, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by sector of activity are presented in the
following table:
(Thousands of euros)
2022
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
57,653
37,446,685
37,504,338
27,929
550,070
577,999
Non-financial companies - Trade
56,649
6,239,615
6,296,264
30,640
76,452
107,092
Non-financial companies - Construction
308,289
2,875,355
3,183,644
158,454
43,117
201,571
Non-financial companies - Manufacturing
industry
173,248
6,972,108
7,145,356
93,885
142,647
236,532
Non-financial companies - Other activities
95,832
2,531,138
2,626,970
44,541
32,325
76,866
Non-financial companies - Other services
454,653
13,531,096
13,985,749
195,688
170,535
366,223
Other Services /Other activities
81,059
15,806,341
15,887,400
37,622
24,323
61,945
Total
1,227,383
85,402,338
86,629,721
588,759
1,039,469
1,628,228
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to individual
analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31 December 2022, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet - it\u00a0 does not include restructured loans):
2022
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2012 and previous
Number of operations
15,703
25,791
293,344
677,001
384
1,012,223
Value (Euros '000)
970,246
3,194,423
10,117,624
1,228,014
81,780
15,592,087
Impairment constituted (Euros '000)
73,617
51,428
106,931
17,378
646
250,000
2013
Number of operations
1,121
3,600
10,115
65,523
17
80,376
Value (Euros '000)
64,192
510,025
376,049
106,759
2,537
1,059,562
Impairment constituted (Euros '000)
3,236
3,441
5,681
3,329
6
15,693
2014
Number of operations
1,234
4,859
8,737
82,035
86
96,951
Value (Euros '000)
76,217
509,250
356,743
126,516
183,780
1,252,506
Impairment constituted (Euros '000)
5,049
9,235
4,719
4,618
855
24,476
2015
Number of operations
1,691
6,284
10,836
112,676
124
131,611
Value (Euros '000)
106,007
908,354
515,361
185,482
44,947
1,760,151
Impairment constituted (Euros '000)
1,947
23,398
3,874
9,116
27,758
66,093
2016
Number of operations
1,911
8,196
12,280
134,403
55
156,845
Value (Euros '000)
154,183
1,209,277
616,181
256,858
4,248
2,240,747
Impairment constituted (Euros '000)
5,274
13,961
4,432
17,195
174
41,036
2017
Number of operations
2,568
11,100
20,277
142,014
96
176,055
Value (Euros '000)
219,318
1,228,140
1,202,742
305,913
13,230
2,969,343
Impairment constituted (Euros '000)
2,807
17,900
5,830
21,347
720
48,604
2018
Number of operations
5,312
19,488
26,701
286,638
203
338,342
Value (Euros '000)
498,338
2,227,925
1,833,809
655,719
309,885
5,525,676
Impairment constituted (Euros '000)
7,262
32,931
6,511
43,836
1,607
92,147
2019
Number of operations
8,703
27,962
30,166
595,430
185
662,446
Value (Euros '000)
632,970
2,098,246
2,198,981
1,221,662
144,135
6,295,994
Impairment constituted (Euros '000)
7,295
45,754
5,735
75,179
3,002
136,965
2020
Number of operations
9,891
37,416
36,088
313,758
255
397,408
Value (Euros '000)
1,148,968
4,324,442
2,656,294
809,745
165,228
9,104,677
Impairment constituted (Euros '000)
13,228
83,686
7,361
42,424
1,638
148,337
2021
Number of operations
10,744
37,545
53,486
524,347
340
626,462
Value (Euros '000)
1,146,704
3,355,457
4,464,436
1,376,201
388,696
10,731,494
Impairment constituted (Euros '000)
15,760
51,953
8,848
61,243
2,299
140,103
2022
Number of operations
14,046
117,544
38,354
1,108,878
4,678
1,283,500
Value (Euros '000)
2,097,778
7,566,584
3,822,846
2,514,949
364,556
16,366,713
Impairment constituted (Euros '000)
19,365
169,939
5,788
64,160
2,593
261,845
Total
Number of operations
72,924
299,785
540,384
4,042,703
6,423
4,962,219
Value (Euros '000)
7,114,921
27,132,123
28,161,066
8,787,818
1,703,022
72,898,950
Impairment constituted (Euros '000)
154,840
503,626
165,710
359,825
41,298
1,225,299
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2021, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet\u00a0 - it does not include restructured loans):
2021
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2011 and previous
Number of operations
16,443
27,013
312,064
707,279
493
1,063,292
Value (Euros '000)
988,051
3,546,686
11,518,139
1,202,309
96,963
17,352,148
Impairment constituted (Euros '000)
74,609
59,229
112,005
25,236
824
271,903
2012
Number of operations
1,184
3,463
11,387
103,094
184
119,312
Value (Euros '000)
80,315
213,802
401,586
144,851
10,158
850,712
Impairment constituted (Euros '000)
3,837
5,324
4,751
4,355
35
18,302
2013
Number of operations
1,641
4,653
11,229
107,983
33
125,539
Value (Euros '000)
81,722
576,793
442,501
136,479
8,762
1,246,257
Impairment constituted (Euros '000)
4,471
8,084
5,580
5,122
5,108
28,365
2014
Number of operations
1,641
6,271
9,805
116,968
95
134,780
Value (Euros '000)
105,894
645,718
422,736
166,061
190,746
1,531,155
Impairment constituted (Euros '000)
3,970
20,745
4,348
7,486
2,191
38,740
2015
Number of operations
2,289
8,314
12,051
161,566
135
184,355
Value (Euros '000)
118,689
964,423
598,334
241,761
42,217
1,965,424
Impairment constituted (Euros '000)
2,824
28,579
3,728
16,198
19,417
70,746
2016
Number of operations
2,669
11,649
13,803
182,204
76
210,401
Value (Euros '000)
163,829
1,478,862
722,220
354,356
4,193
2,723,460
Impairment constituted (Euros '000)
6,010
38,956
3,929
28,921
200
78,016
2017
Number of operations
3,601
16,424
22,504
206,982
135
249,646
Value (Euros '000)
277,439
1,670,775
1,398,081
429,457
18,044
3,793,796
Impairment constituted (Euros '000)
5,095
23,129
4,472
35,979
680
69,355
2018
Number of operations
6,750
28,128
29,336
361,525
252
425,991
Value (Euros '000)
765,450
2,700,168
2,109,180
893,124
334,778
6,802,700
Impairment constituted (Euros '000)
10,003
53,212
4,375
66,397
1,688
135,675
2019
Number of operations
10,349
35,279
33,145
703,461
255
782,489
Value (Euros '000)
916,637
2,723,462
2,540,307
1,582,002
181,729
7,944,137
Impairment constituted (Euros '000)
9,757
69,372
2,964
95,816
2,883
180,792
2020
Number of operations
11,226
42,426
39,282
450,557
362
543,853
Value (Euros '000)
1,671,233
5,360,650
3,082,954
1,138,368
268,429
11,521,634
Impairment constituted (Euros '000)
19,037
87,662
4,534
44,968
2,008
158,209
2021
Number of operations
14,097
107,313
56,969
994,034
5,019
1,177,432
Value (Euros '000)
1,729,149
6,506,623
5,006,493
2,353,761
513,072
16,109,098
Impairment constituted (Euros '000)
17,888
88,776
7,652
35,963
2,954
153,233
Total
Number of operations
71,890
290,933
551,575
4,095,653
7,039
5,017,090
Value (Euros '000)
6,898,408
26,387,962
28,242,531
8,642,529
1,669,091
71,840,521
Impairment constituted (Euros '000)
157,501
483,068
158,338
366,441
37,988
1,203,336
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2022, the following table includes the fair value of the collaterals by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2022
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,822
9,575
9,030
71,315
468,372
303
Value (Euros '000)
882,242
223,661
1,369,613
1,489,242
62,924,078
17,038
>= 0.5 M\u20ac and < 1 M\u20ac
Number
741
70
1,189
236
6,321
4
Value (Euros '000)
520,105
47,186
832,819
162,741
4,080,818
2,230
>= 1 M\u20ac and < 5 M\u20ac
Number
634
47
1,110
205
1,062
1
Value (Euros '000)
1,307,513
84,190
2,223,387
395,940
1,636,182
1,267
>= 5 M\u20ac and < 10 M\u20ac
Number
108
2
118
15
14
\u2014
Value (Euros '000)
737,705
10,838
852,256
102,251
86,476
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
50
2
57
13
1
\u2014
Value (Euros '000)
651,146
21,833
809,825
194,916
11,110
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
22
\u2014
40
1
\u2014
\u2014
Value (Euros '000)
636,352
\u2014
1,208,432
20,452
\u2014
\u2014
>= 50 M\u20ac
Number
6
\u2014
14
2
\u2014
\u2014
Value (Euros '000)
455,600
\u2014
1,245,381
523,630
\u2014
\u2014
Total Number
8,383
9,696
11,558
71,787
475,770
308
Total\u00a0 Value (Euros '000)
5,190,663
387,708
8,541,713
2,889,172
68,738,664
20,535
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2021, the following table includes the fair value of the collaterals\u00a0 by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2021
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,479
10,273
9,346
74,677
476,204
321
Value (Euros '000)
868,524
238,345
1,412,766
1,495,825
60,342,081
17,349
>= 0.5 M\u20ac and < 1 M\u20ac
Number
763
63
1,231
249
5,567
6
Value (Euros '000)
522,827
40,591
858,038
170,352
3,594,194
3,534
>= 1 M\u20ac and < 5 M\u20ac
Number
550
57
1,092
207
883
1
Value (Euros '000)
1,125,581
105,005
2,173,966
388,273
1,337,278
1,474
>= 5 M\u20ac and < 10 M\u20ac
Number
100
3
119
20
10
\u2014
Value (Euros '000)
696,758
16,515
844,212
134,534
63,256
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
44
3
51
15
1
\u2014
Value (Euros '000)
595,828
40,128
687,338
224,766
11,047
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
33
\u2014
35
1
\u2014
\u2014
Value (Euros '000)
958,264
\u2014
1,032,578
49,281
\u2014
\u2014
>= 50 M\u20ac
Number
4
\u2014
13
3
\u2014
\u2014
Value (Euros '000)
260,929
\u2014
1,108,030
827,069
\u2014
\u2014
Total Number
7,973
10,399
11,887
75,172
482,665
328
Total\u00a0 Value (Euros '000)
5,028,711
440,584
8,116,928
3,290,100
65,347,856
22,357
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2022, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgage loans:
(Thousands of euros)
2022
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,528,695
453,957
73,399
70,799
<60%
25,799
1,019,694
259,169
42,667
31,589
>=60% and <80%
2,771
376,094
81,106
21,337
9,536
>=80% and <100%
1,067
131,874
46,414
58,121
49,541
>=100%
979
74,888
73,472
61,705
40,249
Companies - Other Activities
Without associated collateral
n.a.
10,285,172
1,651,463
284,131
393,519
<60%
49,259
1,563,296
495,030
141,344
65,781
>=60% and <80%
16,491
991,449
329,502
128,863
48,995
>=80% and <100%
11,106
576,326
406,133
72,826
47,386
>=100%
2,741
654,901
202,769
280,711
146,244
Mortgage loans
Without associated collateral
n.a.
53,715
2,892
10,403
10,816
<60%
383,344
13,363,029
1,310,064
261,616
102,636
>=60% and <80%
129,126
8,530,613
844,549
112,000
32,431
>=80% and <100%
39,677
2,884,194
357,767
58,421
19,953
>=100%
6,013
235,017
60,244
30,008
15,674
Credit portfolio monitoring process
The Bank adjusted its credit portfolio management and monitoring processes, namely with regard to the assessment of
the potential impacts of the macroeconomic context on the risk profile of the different portfolios/segments of
exposure, an approach that was consolidated in 2022.
This modification, that began in 2020, was based on the creation of a specific approach with the objective of
identifying and closely monitoring the customers potentially more affected by the macroeconomic context, anticipating
possible difficulties in complying their responsibilities and defining credit and performance strategies adjusted to the
specific specificities of each customer/group of customers, with a view to both maintaining support to customers
considered viable and mitigating credit risk.
The importance of this new approach is reinforced by the uncertainty that impacted the activity in recent times. In
fact, while it is true that the effects of the pandemic have faded, new risks have emerged in the meantime, especially
those resulting from the geopolitical conflict between Russia and Ukraine, reinforcing threats that were already
appearing in areas such as constraints in logistics and distribution chains, limitations in access to raw materials and
certain goods, increased energy costs, inflationary pressures and rising interest rates.
The main guidelines of the credit portfolio monitoring approach can be characterized as presented below:
- Global and transversal: Is supported by an analysis of the entire credit portfolio of the Bank, being excluded from the
special monitoring only customers with a better risk profile (in the case of retail) or with exposures of a lower size (in
the case of retail and corporate).
- Specialized: Monitoring by the \u201cComit\u00e9 de Acompanhamento de Risco de Empresas\u201d (CARE), and Credit Division in
coordination with the Rating Division for the corporate segment and by the Retail Recovery Division for individuals and
small businesses. The cases monitored by the CARE Committee, which is conducted at least monthly, are related to
clients covered by a set of criteria that combine exposure size and risk factors like the rating assigned, IFRS 9 staging
and, for the corporate segment, the level of leverage and whether the sector in which it operates is considered highly
vulnerable.
- Segmented: Prioritization of approach/analysis recurrence based on risk signs, in order to gather additional
information and agree on appropriate and sustainable financial restructuring solutions in a timely manner.
- Prospective: Definition of predictive models, in order to anticipate potential future defaults, avoiding a reactive
approach.
- Standardized: Both in terms of risk models and monitoring, and in terms of credit solutions for which it is possible to
identify pre-defined alternatives (retail segments).
- Convenient and innovative: Making the restructuring journey simpler and more convenient both in terms of credit
solutions and channels, extending the restructuring offer to the App for consumer credit and mortgages.
Specifically in the corporate segment, the process of portfolio follow-up and monitoring can be generically
characterized as described below, having as a fundamental component the attribution of credit strategies, among pre-
defined options, with review periods differentiated according to the level of risk associated to the strategy attributed:
1. Client Assessment and presentation of Indicative Credit Strategy by the Rating Division (for customers with ratings
assigned by corporate rating models);
2. Approval, by the competent credit decision levels, of a credit strategy for each customer, taking into consideration
the Indicative Credit Strategy received from the Rating Division, the proposals received from the area that follows the
client and the inputs received as a result of the customer interaction process;
3. Decision, negotiation and formalisation of the operations that will ensure that the approved strategy is pursued and
the approved credit limits are met (Credit Division, Areas that follow the client and Operations Division);
4. Monitoring the Credit Strategy and the evolution of the customer's activity (Credit Division, Areas that follow the
client and Specialised Committees - CARE);
5. Monitoring of the credit portfolio and effectiveness of the portfolio monitoring process and credit strategy
attribution (Risk Office), based on a set of KPIs, (e.g. percentage of the credit portfolio with valid risk strategy;
evolution of credit exposure to customers with a reduction strategy; adequacy of the credit strategy to the customer's
performance);
6. In the attribution of the customer's credit strategy, besides the intrinsic factors of the customer, more transversal
factors are taken into consideration, such as the evaluation of the sectorial risk and ESG impacts (periodically reviewed
with the support of the Economic, Sustainability and Criptoactives Studies Division)
7. The occurrence of effective and/or potential risk events (signs of default/delinquency; breach of contractual
covenants; severe alteration in sector risk; alteration in the corporate/shareholder structure), trigger an extraordinary
revision of the strategy.
Within the scope of this monitoring process and with an impact on other and differentiated procedures adopted by the
Bank, namely for reporting purposes, the Bank defines a list of sectors considered as more vulnerable to the
macroeconomic environment, which is reviewed periodically (at least annually).
At least once a year the Bank produces a report presenting a detailed characterisation of its loan portfolio under a
sectoral perspective.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCreditRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-578": { "value": "Estimates of expected credit losses - Individual analysis
1.Customers who are in one of the following conditions are subject to individual analysis:
Customers in default
Customers in litigation or insolvency, if the total exposure of the group members in these situations exceeds
Euros 1 million
Customers integrated into groups with an exposure over Euros 5 million, if they have a risk grade 15
Groups or customers
who are not in
default
Other customers belonging to groups in the above conditions
Groups or customers with an exposure over Euros 5 million, if a group member has a risk grade 14
Groups or customers with an exposure over Euros 5 million, if a member of the group has a restructured loan
and a risk grade 13
Groups or customers with an exposure over Euros 10 million, if at least one member of the group is in stage 2
Groups or customers not included in the preceding paragraphs, whose exposure exceeds Euros 25 million
\u2013the customer\u2019s available assets in liquidation or insolvency situations;
\u2013the existence of preferential creditors;
\u2013the amount and expected recovery term.
6.Each of the units referred to in the previous point is responsible for assigning an expectation and a recovery period
to exposures relating to customers subject to individual analysis, which must be transmitted to the Risk Office as
part of the regular process of collecting information, accompanied by detailed justification of the proposed
impairment.
7.The expected recovery shall be represented by a recovery rate of the total outstanding exposure, which may be a
weighted rate considering the different recovery prospects for each part of the customer's liabilities.
8.The recovery estimation referred to in the previous point should be influenced by future prospects (forward-
looking), contemplating not only a more expected scenario but also alternative scenarios (an unbiased and
probability-weighted amount). The application and weighting of the scenarios should be carried out both in a
global perspective and in an individualized perspective, the latter when cases that, due to their specificity, have a
high degree of uncertainty regarding the expected recovery estimation are identified.
9.The macroeconomic adjustment set out in point 8 should be analysed annually and weighted according to the type
of recovery strategy associated with the exposure under analysis:
\u2013for Going Concern strategies (i.e., the estimation is based on the cash flows of the business), the possibility of
applying the 2 additional macroeconomic scenarios (optimistic and pessimistic) should be analysed in a global way,
to ascertain if there is the risk of a skewed view of the expected losses from the consideration of only one scenario;
\u2013for Gone Concern strategies (i.e., the recovery estimation is based on the realization of the collateral), the impact
of the macroeconomic scenario on collaterals should be analysed, for example, to what extent the projected real
estate index indicates significant changes ahead for the current valuation values.
10.It is the responsibility of the units referred to in point 5 to consider in their projection macroeconomic expectations
that may influence the recoverability of the debt.
11.For the purposes of the preceding paragraphs, the Economic Studies, Sustainability and Cryptoassets Department
shall disclose the macroeconomic data that allow the estimations to be made.
12.The decision to consider global impacts related to the going and gone concern scenarios should be made by the Risk
Committee, as proposed by the Risk Office.
13.For specific cases with a high degree of uncertainty, the allocation of alternative scenarios should be considered
casuistically. Examples of recovery situations with a degree of uncertainty include:
\u2013recovery of collateral in geographies in which the Bank has no relevant recovery experience;
\u2013recovery of debt related to geographies in which there is strong political instability;
\u2013recovery of non-real estate collateral for which there is no evidence of market liquidity;
\u2013recovery of related collateral or government guarantees in a currency other than the country's own;
\u2013recovery of debt related to debtors for whom there is a strong negative public exposure.
14. The Risk Office is responsible for reviewing the information collected and for clarifying all identified
inconsistencies, as well as for the final decision on the customer's impairment.
15.Customers that have objective signs of impairment, but an individual impairment amount is equal to zero, are
included in the collective analysis, assuming a PD 12-month equivalent to the risk grade 12 of the Master Scale.
16.The individual impairment analysis must be carried out at least annually. In case significant signs of deterioration or
improvement in the customer\u2019s economic and financial situation are detected, as well as the macroeconomic
conditions affecting the customer's ability to accomplish debt, it is the responsibility of the Risk Office to promote
the review of the expected impairment of this customer.
C1.5.6.Estimates of expected credit losses - Collective analysis
Transactions that are not subject to an individual impairment analysis are grouped considering their risk characteristics
and subject to a collective impairment analysis. The Group's credit portfolio is divided by internal risk grades and
according to the following segments:
a)Segments with a reduced history of defaults, designated \u2018low default\u2019: Large corporate exposures, Project finance,
Institutions (banks/financial institutions) and Sovereigns;
b)Segments not \u2018low default\u2019: - Retail: Mortgages; Overdrafts; Credit cards; Small and medium enterprises - Retail
(\u2018SME Retail\u2019); and Others - Corporate: Small and medium enterprises - Corporate (\u2018Large SME\u2019); and Real Estate.
The Group performs statistical tests in order to prove the homogeneity of the segments mentioned above, with a
minimum period of one year.
Expected credit losses are estimates of credit losses that are determined as follows:
\u2013financial assets with no signs of impairment at the reporting date: the present value of the difference between the
contractual cash flows and the cash flows that the Group expects to receive;
\u2013financial assets with impairment at the reporting date: the difference between the gross book value and the present
value of the estimated cash flows;
\u2013unused credit commitments: the present value of the difference between the resulting contractual cash flows if the
commitment is made and the cash flows that the Group expects to receive;
\u2013financial guarantees: the current value of the expected repayments less the amounts that the Group expects to
recover.
The main inputs used to measure ECLs on a collective basis should include the following variables:
\u2013Probability of Default \u2013 PD;
\u2013Loss Given Default \u2013 LGD; and,
\u2013Exposure at Default \u2013 EAD.
These parameters are obtained through internal statistical models and other relevant historical data, considering the
already existing regulatory models adapted to the requirements of IFRS 9.
PDs are estimated based on a certain historical period and will be calculated based on statistical models. These models
are based on internal data including both quantitative and qualitative factors. If there is a change in the risk of the
counterparty or exposure, the estimate of the associated PD will also vary. The PDs will be calculated considering the
contractual maturities of exposures.
The risk grades are a highly relevant input for determining the PD associated with each exposure.
The Group collects performance and default indicators about their credit risk exposures with analysis by types of
customers and products.
LGD is the magnitude of the loss that is expected to occur if an exposure goes into default. The Group estimates the
LGD parameters based on the historical recovery rates after entry into counterparty defaults. The LGD models consider
the associated collaterals, the counterparty activity sector, the default time, as well as the recovery costs. In the case
of contracts secured by real estate, it is expected that the LTV (loan-to-value) ratios are a parameter of high relevance
in the determination of LGD.
The EAD represents the expected exposure if the exposure and/or customer defaults. The Group obtains the EAD values
from the counterparty's current exposure and potential changes to its current value as a result of the contractual
conditions, including amortisations and prepayments. For commitments and financial guarantees, the value of the EAD
will consider both the amount of credit used and the expectation of future potential value that may be used in
accordance with the agreement.
As described above, except for financial assets that consider a 12-month PD as they do not present a significant
increase in credit risk, the Group will calculate the ECL value considering the risk of default during the maximum
contractual maturity period of the contract, even if, for the purpose of risk management, it is considered to be a longer
period. The maximum contractual period shall be considered as the period up to the date on which the Group has the
right to require payment or end the commitment or guarantee.
The Group adopted as a residual term criterion for renewable operations, when in stage 2, a term of 5 years. This term
was determined based on the behavioural models of this type of product applied by the Bank in the liquidity risk and
interest rate (ALM) analysis. According to these models, the maximum period of repayment of these operations is the 5
years considered conservatively in the scope of the calculation of credit impairment.
The Group uses models to forecast the evolution of the most relevant parameters for the expected credit losses,
namely probability of default, which incorporate forward-looking information. This incorporation of forward-looking
information is carried out in the relevant elements considered for the calculation of expected credit losses (ECL).
In particular, the PD point-in-time (PDpit) considered for the determination of the probability of performing exposures
at the reference date becoming defaulted exposures considers the expected values for a set of macroeconomic
variables, based on three scenarios (Central, Upside and Downside Scenario) prepared by the Bank's Economic Studies
area. These scenarios, which are used across the Bank for various purposes besides calculating impairment, consider
existing projections by reference entities.
In December 2022 the Bank carried out an update of the macroeconomic scenarios and of the corresponded adjustment
of the parameters considered in the collective impairment model.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAllowanceForCreditLossesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-579": { "value": "Financial liabilities
C2.1.Classification, initial recognition and subsequent measurement
At initial recognition, financial liabilities are classified in one of the following categories:
\u2013\u201cFinancial liabilities at amortised cost\u201d;
\u2013\u201cFinancial liabilities at fair value through profit or loss\u201d.
C2.1.1.Financial liabilities at fair value through profit or loss
Classification
Financial liabilities classified under \"Financial liabilities at fair value through profit or loss\" include:
a)\u201cFinancial liabilities held for trading\u201d
In this balance the issued liabilities are classified with the purpose of repurchasing in the near term, those that form
part of a portfolio of identified financial instruments that are managed together and for which there is evidence of a
recent actual pattern of short-term profit-taking; or is a derivative (except for a derivative classified as hedging
instrument).
b)\u201cFinancial liabilities designated at fair value through profit or loss\u201d
The Group may irrevocably assign a financial liability at fair value through profit or loss at the time of its initial
recognition if at least one of the following conditions is met:
\u2013the financial liability is managed, evaluated and reported internally at its fair value; or,
\u2013the designation eliminates or significantly reduces the accounting mismatch of transactions.
Initial recognition and subsequent measurement
Considering that the transactions carried out by the Group in the normal course of its business are made in market
conditions, financial liabilities at fair value through profit or loss are initially recognised at fair value with the costs or
income associated with the transactions recognised in profit or loss at the initial moment.
Subsequent changes in the fair value of these financial liabilities are recognised as follows:
\u2013the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of
that liability shall be presented in other comprehensive income;
\u2013the remaining amount of change in the fair value of the liability shall be presented in profit or loss.
The accrual of interest and the premium/discount (when applicable) is recognised in \"Interest expense and similar
charges\" based on the effective interest rate of each transaction.
C2.1.2.Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial guarantee
contracts are subsequently measured at the highest of the following amounts:
\u2013the provision for losses determined according to the criteria described in note C1.5;
\u2013the amount initially recognised deducted, when appropriate, from the accumulated amount of income recognised
according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3. Financial liabilities at amortised cost
Classification
Financial liabilities that were not classified at fair value through profit or loss, or correspond to financial guarantee
contracts, are measured at amortised cost.
The category \"Financial assets at amortised cost\" includes resources from credit institutions and from customers, as
well as subordinated and non-subordinated debt securities.
Initial recognition and subsequent measurement
Financial liabilities at amortised cost are initially recognised at fair value plus transaction costs and are subsequently
measured at amortised cost. Interest on financial liabilities at amortised cost are recognised in \"Interest expense and
similar charges\", based on the effective interest rate method.
C2.2.Reclassification between categories of financial liabilities
Reclassifications of financial liabilities are not allowed.
C2.3.Derecognition of financial liabilities
The Group derecognises financial liabilities when these are cancelled or extinct.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-580": { "value": "Financial guarantees
If they are not designated at fair value through profit or loss at the time of initial recognition, the financial guarantee
contracts are subsequently measured at the highest of the following amounts:
\u2013the provision for losses determined according to the criteria described in note C1.5;
\u2013the amount initially recognised deducted, when appropriate, from the accumulated amount of income recognised
according to IFRS 15 - Revenue from contracts with customers.
Financial guarantee contracts that are not designated at fair value through profit or loss are presented under
\"Provisions\".
C2.1.3.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialGuaranteesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-581": { "value": "Derecognition of financial liabilitiesThe Group derecognises financial liabilities when these are cancelled or extinct.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerecognitionOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-582": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceIncomeAndCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-583": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInterestIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-584": { "value": "Interest recognition
Income and expense related to interest from financial instruments measured at amortised cost are recognised in
\"Interest and similar income\" and \"Interest expense and similar charges\" (net interest income) through the effective
interest rate method. Interest related to financial assets at fair value through other comprehensive income is also
recognised in net interest income.
The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected
life of the financial instrument (or, when appropriate, for a shorter period), to the net carrying amount of the financial
asset or financial liability.
For calculating the effective interest rate, the Group estimates future cash flows considering all contractual terms of
the financial instrument (e.g., early payment options) but without considering future impairment losses. The
calculation includes all fees paid or received considered as included in the effective interest rate, transaction costs and
all other premiums or discounts directly related to the transaction, except for assets and liabilities at fair value through
profit and loss.
Interest income recognised in income associated with contracts classified in stage 1 or 2 are determined by applying the
effective interest rate for each contract on its gross book value. The gross balance of a contract is its amortised cost,
before deducting the respective impairment. For financial assets included in stage 3, interest is recognised in the
income statement based on its net book value (less impairment). The interest recognition is always made in a
prospective way, i.e., for financial assets entering stage 3, interest is recognised at the amortised cost (net of
impairment) in subsequent periods.
For purchased or originated credit-impaired assets (POCI), the effective interest rate reflects the expected credit losses
in determining the expected future cash flows receivable from the financial asset.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinanceCostsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-585": { "value": "Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance with IAS
39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and foreign
exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge accounting
are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in accordance
with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013at the inception of the hedge there is formal documentation of the hedge;
\u2013the hedge is expected to be highly effective;
\u2013the effectiveness of the hedge can be reliably measured;
\u2013the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to variations in
cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets or
liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised through
profit and loss, as well as changes in currency risk of the monetary items.
C4.1.Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are recognised
in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or liability or
group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge accounting, the
cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised until the
discontinuance of the hedge accounting are amortised through profit and loss over the residual term of the hedged
item.
C4.2.Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify as
cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge relations. Any
gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will affect
profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the hedging
relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked, the hedge
relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative accumulated in
equity until the date of the discontinued hedge accounting can be:
\u2013deferred over the residual period of the hedged instrument; or,
\u2013recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised in
equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income statement.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is
immediately transferred to profit and loss.
C4.3.Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such, the
Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective tests in
order to demonstrate at each reporting period the effectiveness of the hedging relationships, demonstrating that the
variations in fair value of the hedging instrument are hedged by the fair value variations of the hedged item in the
portion assigned to the risk covered. Any ineffectiveness is recognised immediately in profit and loss when incurred.
C4.4.Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange gain or
loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The gain or loss
relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses accumulated in equity
related to the investment in a foreign operation and to the associated hedge operation are recognised in equity and
transferred to profit and loss, on the disposal of the foreign operation as part of the gain or loss from the disposal.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForHedgingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-586": { "value": "Hedge accounting
As allowed by IFRS 9, the Group opted to continue to apply the hedge accounting requirements in accordance with IAS
39.
The Group designates derivatives and other financial instruments to hedge its exposure to interest rate and foreign
exchange risk, resulting from financing and investment activities. Derivatives that do not qualify for hedge accounting
are accounted for as trading instruments.
Derivative hedging instruments are stated at fair value and gains and losses on revaluation are recognised in accordance
with the hedge accounting model adopted by the Group. A hedge relationship exists when:
\u2013at the inception of the hedge there is formal documentation of the hedge;
\u2013the hedge is expected to be highly effective;
\u2013the effectiveness of the hedge can be reliably measured;
\u2013the hedge is assessed in a continuous basis and highly effective throughout the reporting period; and,
\u2013for hedges of a forecasted transaction, the transaction is highly probable and presents an exposure to variations in
cash flows that could ultimately affect profit or loss.
When a derivative financial instrument is used to hedge foreign exchange variations arising from monetary assets or
liabilities, no hedge accounting model is applied. Any gain or loss associated to the derivative is recognised through
profit and loss, as well as changes in currency risk of the monetary items.
C4.1.Fair value hedge
Changes in the fair value of derivatives that are designated and qualify as fair value hedge instruments are recognised
in profit and loss, together with changes in the fair value attributable to the hedged risk of the asset or liability or
group of assets and liabilities. If the hedge relationship no longer meets the criteria for hedge accounting, the
cumulative gains and losses due to variations of hedged risk linked to the hedge item recognised until the
discontinuance of the hedge accounting are amortised through profit and loss over the residual term of the hedged
item.
C4.2.Cash flow hedge
In a hedge relationship, the effective portion of changes in fair value of derivatives that are designated and qualify as
cash flow hedges are recognised in equity - cash flow hedge reserves in the effective part of the hedge relations. Any
gain or loss relating to the ineffective portion of the hedge is immediately recognised in profit and loss when occurred.
Amounts accumulated in equity are reclassified to profit and loss in the periods in which the hedged item will affect
profit or loss.
In case of hedging variability of cash flows, when the hedge instrument expires or is disposed or when the hedging
relationship no longer meets the criteria for hedge accounting, or when the hedge relation is revoked, the hedge
relationship is discontinued on a prospective basis. Therefore, the fair value changes of the derivative accumulated in
equity until the date of the discontinued hedge accounting can be:
\u2013deferred over the residual period of the hedged instrument; or,
\u2013recognised immediately in results if the hedged instrument is extinguished.
In the case of a discontinued hedge of a forecast transaction, the change in fair value of the derivative recognised in
equity at that time remains in equity until the forecasted transaction is ultimately recognised in the income statement.
When a forecasted transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is
immediately transferred to profit and loss.
C4.3.Hedge effectiveness
For a hedge relationship to be classified as such according to IAS 39, effectiveness must be demonstrated. As such, the
Group performs prospective tests at the beginning date of the initial hedge, if applicable, and retrospective tests in
order to demonstrate at each reporting period the effectiveness of the hedging relationships, demonstrating that the
variations in fair value of the hedging instrument are hedged by the fair value variations of the hedged item in the
portion assigned to the risk covered. Any ineffectiveness is recognised immediately in profit and loss when incurred.
C4.4.Hedge of a net investment in a foreign operation
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any exchange gain or
loss on the hedging instrument relating to the effective portion of the hedge is recognised in equity. The gain or loss
relating to the ineffective portion is immediately recognised in profit and loss. Gains and losses accumulated in equity
related to the investment in a foreign operation and to the associated hedge operation are recognised in equity and
transferred to profit and loss, on the disposal of the foreign operation as part of the gain or loss from the disposal.
C5.Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and benefits of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsAndHedgingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-587": { "value": "Embedded Derivatives
An embedded derivative is a component of a hybrid agreement, which also includes a non-derived host instrument.
If the main instrument included in the hybrid contract is considered a financial asset, the classification and
measurement of the entire hybrid contract is carried out in accordance with the criteria described in note C1.1.3.
Derivatives embedded in contracts that are not considered financial assets are treated separately whenever the
economic risks and benefits of the derivative are not related to those of the main instrument, since the hybrid
instrument is not initially recognised at fair value through profit or loss. Embedded derivatives are recorded at fair
value with subsequent fair value changes recorded in profit or loss for the period and presented in the trading
derivatives portfolio.
D.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDerivativeFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-588": { "value": "
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to deliver
cash or another financial asset to another entity or to exchange financial assets or financial liabilities with another
entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may be settled in
the issuer's own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to
deliver a variable number of its own equity instruments or a derivative that will be settled only by the issuer
exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity after
deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to the
amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised in equity,
net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is solely
at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are deducted
to equity.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDividendsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-589": { "value": "
A financial instrument is an equity instrument only if: i) the instrument includes no contractual obligation to deliver
cash or another financial asset to another entity or to exchange financial assets or financial liabilities with another
entity under conditions that are potentially unfavourable to the entity; and, ii) the instrument will or may be settled in
the issuer's own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to
deliver a variable number of its own equity instruments or a derivative that will be settled only by the issuer
exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments.
An equity instrument, independently from its legal form, evidences a residual interest in the assets of an entity after
deducting all its liabilities.
Transaction costs directly attributable to an equity instrument issuance are recognised in equity as a deduction to the
amount issued. Amounts paid or received related to sales or acquisitions of equity instruments are recognised in equity,
net of transaction costs.
Preference shares issued by the Group are considered as an equity instrument when redemption of the shares is solely
at the discretion of the Group and dividends are paid at the discretion of the Group.
Income from equity instruments (dividends) are recognised when the obligation to pay is established and are deducted
to equity.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIssuedCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-590": { "value": "Securities borrowing
Securities lent under securities lending arrangements continue to be recognised in the balance sheet and are measured
in accordance with the applicable accounting policy. Cash collateral received in respect of securities lent is recognised
as a financial liability. Securities borrowed under securities borrowing agreements are not recognised. Cash collateral
placements in respect of securities borrowed are recognised under loans and advances to either banks or customers.
Income and expenses arising from the securities borrowing and lending business are recognised on an accrual basis over
the period of the transactions and are included in interest income or expense (net interest income).
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRestrictedCashAndCashEquivalentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-591": { "value": "Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities substantially
equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to reselling
agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in loans and
advances to customers or loans and advances to credit institutions. The receivables are collateralised by the related
securities. Securities sold through repurchase agreements continue to be recognised in the balance sheet and are
revaluated in accordance with the applicable accounting policy. The amounts received from the proceeds of these
securities are considered as deposits from customers and deposits from credit institutions. The difference between the
acquisition/sale and reselling/repurchase conditions is recognised on an accrual basis over the period of the transaction
and is included in interest income or expenses.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRepurchaseAndReverseRepurchaseAgreementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-592": { "value": "Repurchase agreements
The Group performs acquisition/sale of securities under reselling/repurchase agreements of securities substantially
equivalent in a future date at a predetermined price ('repos'/'reverse repos'). The securities related to reselling
agreements in a future date are not recognised in the balance sheet. The amounts paid are recognised in loans and
advances to customers or loans and advances to credit institutions. The receivables are collateralised by the related
securities. Securities sold through repurchase agreements continue to be recognised in the balance sheet and are
revaluated in accordance with the applicable accounting policy. The amounts received from the proceeds of these
securities are considered as deposits from customers and deposits from credit institutions. The difference between the
acquisition/sale and reselling/repurchase conditions is recognised on an accrual basis over the period of the transaction
and is included in interest income or expenses.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForRepurchaseAndReverseRepurchaseAgreementsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-593": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
Non-current assets held for sale
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
326,577
(90,699)
235,878
630,082
(127,218)
502,864
Assets belong to investments funds and
real estate companies
266,544
(46,497)
220,047
279,071
(50,481)
228,590
Assets for own use (closed branches)
20,556
(6,626)
13,930
22,800
(5,939)
16,861
Equipment and other
22,117
(5,743)
16,374
24,421
(7,076)
17,345
Other assets
12,806
\u2014
12,806
14,854
\u2014
14,854
648,600
(149,565)
499,035
971,228
(190,714)
780,514
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleAndDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-595": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForNoncurrentAssetsOrDisposalGroupsClassifiedAsHeldForSaleExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-596": { "value": "Non-current assets held for sale and Discontinued or discontinuing operations
Non-current assets, groups of non-current assets held for sale (groups of assets together with related liabilities that
include at least\u00a0 a non-current asset) and discontinued operations are classified as held for sale when the intention is
to sell the referred assets and liabilities and when the referred assets or group of assets are available for immediate
sale, subject to the terms of sale usually applicable to these types of assets, and its sale is highly probable, in
accordance with IFRS 5. For the sale to be considered highly probable, the Group must be committed to a plan to sell
the asset (or disposal group) and must have initiated an active program to locate a buyer and complete the plan. In
addition, the asset (or disposal group) must be actively marketed for sale at a price that is reasonable in relation to its
current fair value. Furthermore, it should be expected that the sale qualifies for recognition as a completed sale within
one year from the date of classification, except as permitted by paragraph 9 of IFRS 5, and that the Group remains
committed to the asset sales plan and the delay is caused by events or circumstances beyond its control.
The Group also classifies as non-current assets held for sale those non-current assets or groups of assets acquired
exclusively with a view to its subsequent disposal, which are available for immediate sale and its sale is highly
probable. Immediately before classification as held for sale, the measurement of the non-current assets or all assets
and liabilities in a disposal group, is performed in accordance with the applicable IFRS. After their reclassification,
these assets or disposal groups are measured at the lower of their cost and fair value less costs to sell.
Discontinued operations and the subsidiaries acquired exclusively with the purpose to sell in the short-term are
consolidated until the moment of their sale.
G1.Non-operating real estate (INAE)
The Group also classifies as non-current assets held for sale the non-operating real estate (INAE), which include
properties acquired by the Group as a result of the resolution of customer credit processes, as well as own properties
that are no longer used by the Group's services.
Properties held by real estate companies and real estate investment funds, which are part of the Group's consolidation
perimeter, whose capital or units acquired by the Group as a result of the recovery loans are treated as INAE.
At the time of acquisition, real estate classified as INAE is recognised at the lower of the value of the loans existing on
the date on which the recovery occurs, or the judicial decision is formalised, and the fair value of the property, net of
estimated costs for sale. Subsequent measurement of INAE is made at the lower of their book value and the
corresponding fair value, net of the estimated costs for their sale and are not subject to amortisation. Impairment
losses are recorded in the results of the period in which they arise.
The fair value is determined based on the market value, which is determined based on the expected sales price
obtained through periodic evaluations made by expert external evaluators accredited to the Comiss\u00e3o do Mercado de
Valores Mobili\u00e1rios (CMVM).
The principles used to determine the net fair value of selling costs of a property apply, whenever possible, to real
estate like INAE held by Real Estate Companies and Real Estate Investment Funds for the purpose of consolidating
Group accounts.
Whenever the net fair value of the selling costs calculated for an INAE is less than the amount by which the same is
recognised in the Group's balance sheet, an impairment loss is recorded in the amount of the decrease in value
ascertained. Impairment losses are recorded against income for the year.
If the net fair value of the selling costs of an INAE, after recognition of impairment, indicates a gain, the Group may
reflect that gain up to the maximum of the impairment that has been recorded on that property.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDiscontinuedOperationsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-597": { "value": "Lease transactions (IFRS 16)
This standard establishes the requirements regarding the scope, classification/recognition and measurement of leases:
\u2013from the lessor's perspective, leases will continue to be classified as finance leases or operating leases;
\u2013from the lessee\u2019s perspective, the standard defines a single model of accounting for lease contracts, which results
in the recognition of a right-of-use asset and a lease liability for all leases, except for those which the lease term
ends within 12 months or for those which the underlying asset is of low-value and, in these cases, the lessee may
opt for the exemption from recognition under IFRS 16 and shall recognise the lease payments associated with these
leases as an expense.
The Group chose not to apply this standard to short-term lease contracts, i.e. contracts with a term shorter than or
equal to one year, and to lease contracts in which the underlying asset\u2019s value is below Euros 5,000. Additionally, this
standard was not applied to leases of intangible assets.
Lease definition
The lease definition focuses on the control of the identified asset, establishing that a contract constitutes or contains a
lease if it carries the right to control the use of an identified asset, i.e., the right to obtain substantially all the
economic benefits of using it, and the right to choose how to use the identified asset over a period in exchange of a
payment.
Impacts from the lessee\u2019s perspective
The Group recognises for all leases, except for those with a term under 12 months or for leases of low-value assets:
\u2013a right-of-use asset initially measured at cost must consider the Net Present Value (NPV) of the lease liability plus
the value of payments made (fixed and/or variable), deducted from any lease incentives received, penalties for
terminating the lease (if reasonably certain), as well as any cost estimates to be supported by the lessee with the
dismantling and removal of the underlying asset and/or with the recovery of its location. Subsequently, it will be
measured according to the cost model (subject to depreciations/amortisations and impairment tests);
\u2013a lease liability initially recorded at the present value of the remaining lease payments (NPV), which includes:
\u2013fixed payments deducted from any lease incentives receivable;
\u2013variable lease payments that depend on a rate or an index, initially measured considering the rate or index as at
the commencement date;
\u2013amounts expected to be paid by the lessee under residual values guarantees;
\u2013the exercise price of a purchase option, if the lessee is reasonably certain to exercise that option;
\u2013payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to end
the lease.
Since it is not possible to easily determine the implicit interest rate in the lease (paragraph 26 of IFRS 16), lease
payments are discounted according to the lessee\u2019s incremental borrowing rate, which embodies the risk-free rate curve
(swap curve) plus the Group\u2019s spread of risk, applied over the weighted average term of each lease contract. For term
contracts, that date is considered as the end of lease date, while for contracts without term, or with renewable terms,
it is assessed using the date in which the contract is enforceable, as well as eventual economic penalties associated
with the lease contract. In the evaluation of enforceability, the particular clauses of the contracts are considered, as
well as the current law on Urban Leases.
Subsequently, lease payments are measured as follows:
\u2013by increasing their carrying amount to reflect interest;
\u2013by reducing their carrying amount to reflect lease payments;
\u2013carrying amount shall be remeasured to reflect any leases\u2019 revaluations or changes, as well as to reflect the review
of in -substance fixed payments and the review of the lease term.
The Group remeasures the lease liability (and makes a corresponding adjustment to the right-of-use asset) whenever:
\u2013the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case
the lease liability is remeasured by discounting the revised lease payments using the revised discount rate;
\u2013the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed
residual value, in which cases the liability is remeasured by discounting the revised lease payments using the initial
discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a
revised discount rate is used;
\u2013a lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the
lease liability is remeasured by discounting the revised lease payments using the revised discount rate.
The Group did not make any adjustment during the periods presented.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If the
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to
exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset.
The depreciation starts at the commencement date of the lease.
The implementation of this standard implies changes in the Group\u2019s financial statements, namely:
\u2013in the consolidated income statement:
(i)recording in \u201cInterest Income\u201d the interest expenses related to lease liabilities;
(ii)recording in \u201cOther administrative costs\u201d the amounts related to short-term lease contracts and to lease
contracts of low-value assets; and,
(iii)recording in \u201cAmortisations and depreciations\u201d the depreciation expenses related to right-to-use assets.
\u2013.in the consolidated balance sheet:
(i)recording in \u201cFinancial assets at amortised cost \u2013 Loans and advances to customers\u201d the recognition of financial
assets related to sublease operations measured accordingly to IFRS 9;
(ii)recording in \u201cOther tangible assets\u201d the recognition of right-to-use assets; and,
(iii)recording in \u201cOther liabilities\u201d the amount of recognised lease liabilities.
\u2013in the consolidated statement of cash flows, the balance \u201cCash flows arising from operating activities \u2013 Payments
(cash) to suppliers and employees\u201d includes amounts related to short-term lease contracts and to lease contracts of
low-value assets, and the balance \u201cCash flows arising from financing activities - Decrease in other sundry liabilities
and non-controlling interests\u201d includes amounts related to payments of lease liabilities\u2019 capital portions, as detailed
in the consolidated statement of cash flows.
Impact from the lessor\u2019s perspective
In accordance with IFRS 16, paragraph 62, lessors shall classify leases as finance or operational leases.
A lease is classified as a finance lease if it transfers substantially all the risks and rewards inherent to ownership of an
underlying asset. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards
inherent to ownership of an underlying asset.
Subleases
A sublease implies that the lessee establishes a lease contract with a third party, which acts as an intermediary, and
the lease contract with the original lessor is kept in force.
IFRS 16 \u2013 Leases requires that the lessor evaluates subleases regarding right-to-use and not regarding the underlying
asset.
The sublease\u2019s lessor, simultaneously lessee regarding the original lease, shall recognise an asset in the financial
statement \u2013 a right-to-use related to the initial lease (if the lease is classified as operating) or a financial asset,
measured according to IFRS 9, related to the sublease (if the lease is classified as financing).
In case the primary lease is short-term, then the sublease should be classified as an operating lease.
Impact of the pandemic caused by COVID-19 virus
On 12 October 2020, the European Union published an amendment to IFRS 16, associated with income concessions
related to COVID-19. This amendment allows tenants, as a practical expedient, to have the possibility to choose not to
consider a rent concession that occurs as a direct consequence of the COVID-19 pandemic as a modification of the
lease. A lessee who uses this option must account for any concession that occurs at the rent level in the same way that
he would do it under IFRS 16 \u2013 Leases, if this change did not constitute a modification of the lease. This amendment
does not affect lessors.
Within the scope of the sublease, the Group carried out the analysis of the respective contracts.
I.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForLeasesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-598": { "value": "Recognition of income from services and commissions
In accordance with IFRS 15, the Bank recognizes revenue associated with services and commissions when (or as) a
performance obligation is satisfied when transferring a service, based on the transaction price associated with this
performance obligation. In this context, the Bank takes the following steps to recognize revenue associated with
services and commissions:
- Recognition (satisfaction of the performance obligation): (i) identification of the contract associated with the service
provided and whether it should be covered by IFRS 15; (ii) identification of performance obligations associated with
each contract; (iii) definition of the criteria for the fulfilment of performance obligations, also considering the
contractual terms established with the counterparty. According to this definition, a service is transferred when the
customer obtains the benefits and control associated with the service provided. In this context, the Bank also identifies
whether performance obligations are met over time (\u201cover time\u201d) or at an exact moment (\u201cpoint in time\u201d), with
revenue being recognized accordingly.
- Measurement (price to be recognized associated with each performance obligation): (i) determine the transaction
price associated with the service provided, considering the contractual terms established with the counterparty and its
usual commercial practices. The transaction price is the amount of consideration to which the Bank expects to be
entitled in exchange for transferring promised services to the customer, excluding amounts collected on behalf of third
parties. The Bank includes in the transaction price part or all of the estimated amount of the variable consideration
associated with a performance obligation, only to the extent that it is highly probable that a significant reversal in the
amount of the accrued revenue recognized will not occur when the uncertainty associated with that variable
consideration is subsequently resolved; and (ii) allocate the transaction price to each of the performance obligations
identified under the contract established with the customer.
It should be noted that when services or commissions are an integral part of the effective interest rate of a financial
instrument, income resulting from services and commissions is recorded in net interest income (Note C.3).
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFeeAndCommissionIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-599": { "value": "Gains/(losses) on financial operations at fair value through profit or loss, Foreign exchange
gains/(losses), Hedge accounting gains/(losses), Gains/(losses) from derecognition of assets
and liabilities at amortised cost and Gains/(losses) from derecognition of financial assets at
fair value through other comprehensive income
These balances include gains and losses on financial assets and liabilities at fair value through profit and loss, i.e., fair
value changes and interest on trading derivatives and embedded derivatives, as well as the corresponding dividends
received. This balance also includes the gains and losses on sale of financial assets at fair value through other
comprehensive income and financial assets and financial liabilities at amortised cost. The changes in fair value of
hedging derivatives and hedged items, when fair value hedge is applicable, are also recognised in this balance, as well
as the foreign exchange gains or losses.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTradingIncomeAndExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-600": { "value": "Other tangible assets
Other tangible assets are stated at acquisition cost less accumulated depreciation and impairment losses. Subsequent
costs are recognised as a separate asset only when it is probable that future economic benefits will result for the
Group. All other repairs and maintenance expenses are charged to the income statement during the financial period in
which they are incurred, under the principle of accrual-based accounting.
Depreciation is calculated on a straight-line basis, over the following periods which correspond to their estimated
useful life:
Number of years
Buildings
50
Expenditure on freehold and leasehold buildings
10
Equipment
4 to 12
Other tangible assets
3
are prepared in their functional currency and translated into Euros at the end of each financial period. The exchange
rates used for the conversion of balance sheet foreign currency amounts are the ECB reference rates at the end of each
period. In foreign currency conversion of results, are calculated average exchange rates according to the closing
exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
(Balance sheet)
(Income statement)
Currency
2022
2021
2022
2021
AOA
543.2680
632.4200
487.7116
747.0708
BRL
5.6390
6.3364
5.4153
6.3950
CHF
0.9872
1.0362
1.0042
1.0811
MOP
8.5744
9.1330
8.5744
9.1330
MZN
68.1850
72.9000
67.5585
77.9329
PLN
4.6816
4.5839
4.6823
4.5623
USD
1.0667
1.1373
1.0537
1.1833
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForForeignCurrencyTranslationExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-611": { "value": "Employee benefits
R1.Defined benefit plans
The Group has the responsibility to pay its employees' retirement pensions, invalidity pensions and survivor\u2019s pensions
for their death, in accordance with the terms of the two collective labour agreements approved. These benefits are
provided for in the pension plans \u2018Plano ACT\u2019 and \u2018Plano ACTQ\u2019 of the Banco Comercial Portugu\u00eas Group Pension Fund.
Following the publication of Decree-Law no. 54/2009, of 2 March, banking entities are obligatorily enrolling new
employees in the General Social Security System (RGSS). These employees have the RGSS as their basic retirement
scheme, and do not have any benefits under the ACT (base plan). Under the scope of its management and human
resources, the Group had already adopted as a rule the inclusion of new employees in the RGSS since July 2005.
However, until the transposition into the ACT of the alterations resulting from the referred Decree-Law no. 54/2009, all
employees were covered by the provisions of the social security chapter of the ACT, and for employees who were
already registered with the RGSS, the ACT benefit worked as a complement to the RGSS. As of 1 July 2009, in
accordance with the ACT, all new employees only have the RGSS as their basic social security scheme.
Until 2011, in addition to the benefits provided for in the two plans above-mentioned, the Group had assumed the
responsibility, if certain conditions of profitability were verified in each year, of assigning retirement supplements to
the Group's employees hired up to 21 September 2006 (Complementary Plan). The Group, at the end of 2012,
determined the extinction (cut) of the old-age benefit of the Complementary Plan. On 14 December 2012, Instituto de
Seguros de Portugal (ISP) formally approved this change to the Group\u2019s benefit plan, effective from 1 January 2012. The
plan was cut, and employees were given individual acquired rights. On that date, the Group also proceeded to the
settlement of the respective liability.
From 1 January 2011, Bank employees were integrated in the General Social Security Scheme which now covers their
maternity, paternity, adoption and pension benefits. However, the banks remain liable for benefits that concern
illness, disability and life insurance (Decree-Law no. 1-A/2011, of 3 January).
The contributory rate is 26.6% divided between 23.6% supported by the employer and 3% supported by the employee,
replacing the Banking Social Healthcare System which was extinguished by the decree law referred above. As a
consequence of this amendment the capability to receive pensions by the actual employees are covered by the General
Social Security Scheme regime, considering the service period between 1 January 2011 and the retirement age. The
banks support the remaining difference for the total pension assured in the Collective Labour Agreement (ACT).
This integration has led to a decrease in the present value of the total benefits reported to the retirement age to be
borne by the Pension Fund, and this effect is to be recorded in accordance with the Projected Unit Credit during the
average lifetime of the pension until the normal retirement age is reached. The calculation of the liability for pensions
carried out periodically by the actuary considers this effect and is calculated considering the actuarial assumptions in
force, ensuring that the liabilities calculated with reference to 31 December 2010, not considering the effect of the
integration of bank employees into the General Social Security Scheme are fully covered and deducted from the amount
of the effect recognised until the date. The component of this effect for the year is recognised under the heading
\"Current service costs\".
Following the approval by the Government of the Decree-Law no. 127/2011, which was published on 31 December, an
agreement was established between the Government, the Portuguese Banking Association and the Banking Labour
Unions in order to transfer, to the Social Security, the liabilities related to pensions currently being paid to pensioners
and retirees, as at 31 December 2011.
This agreement established that the responsibilities to be transferred related to the pensions in payment as at 31
December 2011 at fixed amounts (discount rate 0%) in the component established in the IRCT - Instrument of Collective
Regulation of Work of the retirees and pensioners. The responsibilities related to the increase in pensions as well as any
other complements, namely, contributions to the Health System (SAMS), death benefit and death before retirement
benefit continued to be under the responsibility of the Financial Institutions.
At the end of December 2016, a revision of the ACT was reached between the BCP Group and four unions from the two
union federations of the unions that represent the Group's employees, which introduced changes in the Social Security
clause and consequently in the pension plan financed by the BCP Group Pension Fund. The new ACT was published by
the Ministry of Labour in the Bulletin of Labour and Employment on 15 February 2017 and the effects were recorded in
the financial statements of 31 December 2016, for employees associated with these four unions.
The negotiation with Sindicato dos Banc\u00e1rios do Norte (SBN), which was also involved in the negotiations of the new
ACT, was concluded in April 2017 with the publication of the Bulletin of Labour and Employment, with the effects of
this new ACT recorded in the financial statements as at 31 December 2017, for employees associates of SBN.
The most relevant changes in the ACT were the change in the retirement age (presumed disability) from 65 years to 66
years and two months in 2016 and the subsequent update of an additional month in each year, which cannot, in any
case, be higher than the one in force at any moment in the General Regime of Social Security, the change in the
formula for determining the employer's contribution to SAMS and, lastly, the introduction of a new benefit called the
End of Career Premium, which replaces the Seniority Premium.
These changes were framed by the Group as a change to the pension plan under the terms of IAS 19, as such had an
impact on the present value of the liabilities with services rendered and were recognised in the income statement for
the year under \"Staff costs\".
In 2017, after the authorization of the Autoridade de Supervis\u00e3o de Seguros e Fundos de Pens\u00f5es (ASF - Portuguese
Insurance and Pension Funds Supervision Authority), the BCP Group's pension fund agreement was amended. The main
purpose of the process was to incorporate into the pension fund the changes introduced in the Group's ACT in terms of
retirement benefits, as well as to transfer to the pension fund the responsibilities that were directly chargeable to the
company (extra-fund liabilities). The pension fund has a part exclusively for the financing of these liabilities which, in
the scope of the fund, is called Additional Complement. The End of Career Premium also became the responsibility of
the pension fund under the basic pension plan.
The Group\u2019s net obligation in respect of pension plans (defined benefit pensions plan) is calculated on a half year basis
on 31 December and 30 June of each year, and whenever there are significant market fluctuations or significant
specific events, such as changes in the plan, curtailments or settlements since the last estimation. The responsibilities
with past service are calculated using the Projected Unit Credit method and actuarial assumptions considered
adequate.
Pension liabilities are calculated by the responsible actuary, who is certified by the ASF.
The Group\u2019s net obligation in respect of defined benefit pension plans and other benefits is calculated separately for
each plan by estimating the amount of future benefit that employees have earned in return for their service in the
current and prior periods. The benefit is discounted to determine its present value, using a discount rate determined by
reference to interest rates of high- quality corporate bonds that have maturity dates approximating the terms of the
Group\u2019s obligations. The net obligations are determined after the deduction of the fair value of the Pension Plan's
assets.
The income/cost of interest with the pension plan is calculated by the Group, multiplying the net asset/liability with
retirement pension (liabilities less the fair value of the plan's assets) by the discount rate used in the determination of
the retirement pension liabilities. On this basis, the income/cost net of interest includes the interest costs associated
with retirement pension liabilities and the expected return of the plan's assets, both measured based on the discount
rate used to calculate the liabilities.
Gains and losses from the re-measurement, namely (i) actuarial gains and losses resulting from differences between
actuarial assumptions used and the amounts actually observed (experienced gains and losses) and changes in actuarial
assumptions and (ii) gains and losses arising from the difference between the expected return of the plan's assets and
the amounts obtained, are recognised against equity under \"Other comprehensive income\".
The Group recognises in its income statement a net total amount that comprises (i) the current service cost, (ii) the
income/cost net of interest with the pension plan, (iii) the effect of early retirement, (iv) past service costs and, (v)
the effects of any settlement or curtailment occurred during the period. The net income/cost with the pension plan is
recognised as interest and similar income or interest expense and similar costs depending on their nature. The costs of
early retirements correspond to the increase in liabilities due to the employee's retirement before reaching the age of
retirement.
Employee benefits, other than pension plans, namely post-retirement health care benefits and benefits for the spouse
and descendants for death before retirement are also included in the benefit plan calculation.
The contributions to the funds are made annually by each company of the Group, according to a specific contribution
plan that ensures the solvency of the fund. In the end of each year, according to Bank of Portugal Notice no. 12/2001,
the minimum level required for the responsibilities funding must be 100% regarding pension payments and 95%
regarding past services of active employees.
R2.Revision of the salary tables for employees in service and pensions in payment
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates took
effect on 1 January 2021, except for compensation for subsistence and travel allowances, which were updated after the
agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions Mais Sindicato do Sector Financeiro, SBC \u2013 Sindicato Banc\u00e1rios do Centro and SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal, the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates took effect on 1 January 2022,\u00a0 except for compensation for subsistence
and travel allowances, which were updated after the agreed updates are operational.
Regarding SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios and SIB \u2013 Sindicato Independente da Banca, an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing.
R3.Defined contribution plan
For the defined contribution plans, the responsibilities related to the benefits attributed to the Group's employees are
recognised as expenses when incurred.
As at 31 December 2022, the Group has two defined contribution plans. One plan covers employees who were hired
before 1 July 2009. For this plan, called non-contributory, Group's contributions will be made annually and equal to 1%
of the annual remuneration paid to employees in the previous year. Contributions shall only be made if the following
requirements are met: (i) the Bank's ROE equals or exceeds the rate of government bonds of 10 years plus 5 percentage
points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
The other plan covers employees who have been hired after 1 July 2009. For this plan, designated contributory,
monthly contributions will be made equal to 1.5% of the monthly remuneration received by employees in the current
month, either by themselves or by the Group and employees. This contribution has a mandatory character and is
defined in the Collective Labour Agreement of the BCP Group and does not have a performance criterion.
R4.Variable remuneration paid to employees
The remuneration policy for employees includes an annual variable remuneration system for employees not covered by
commercial incentive systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and of the annual fixed
remuneration of reference for the role performed, and provided that the Bank's minimum level of performance, as
measured by a set of quantitative indicators, is met, the amount of the variable remuneration to be attributed to each
employee is determined.
The Executive Committee is responsible, under the terms defined in the remuneration policy, for setting the respective
allocation criteria for each employee, whenever it is attributed. The variable remuneration attributed to employees is
recorded against the income statement in the period to which it relates.
R5.Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
projections, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
As defined by IAS 19, the discount rate used to update the responsibilities of the Bank's pension fund is based on an
analysis performed over the market yields regarding a bond issues universe \u2013 that the Group considers having high
quality (low risk), different maturities (appropriate to the period of liquidation of the fund's liabilities) and
denominated in euros - related to a diverse and representative range of issuers.
Y6.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEmployeeBenefitsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-612": { "value": "Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSharebasedPaymentTransactionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-613": { "value": "Share-based compensation plan
As at 31 December 2022, a variable compensation plan with BCP shares is in force for the members of the Executive
Committee and for the employees considered Key Function Holders (includes Key Management Members), resulting from
the Remuneration Policies for the members of the management and supervisory bodies and for the Employees, both
approved for the financial year of 2022 and following years, with the changes that may be approved in each financial
year, namely by the General Shareholders\u2019 Meeting regarding the Remuneration Policy for the members of the
management and supervisory bodies, and by the Board of Directors regarding the Remuneration Policy for Employees.
Key Function Holders include Key Management Members, which are the first line directors who report directly to the
Board of Directors and the remaining employees whose professional activities have a significant impact on the Bank's
risk profile.
As defined in the Remuneration Policy for the members of the management and supervisory bodies, an annual variable
remuneration system is foreseen, for which an assessment of the performance of each member of the Executive
Committee is carried out on an annual basis based on quantitative and qualitative criteria. According to this assessment
and the annual fixed remuneration, and provided that the Bank's minimum level of performance as measured by a set
of quantitative indicators is met, the amount of the variable remuneration to be attributed to each member of the
Executive Committee is decided by the Remuneration and Welfare Board. The payment of the amount of the variable
remuneration attributed is subject to a deferral period of 5 years for 50% of its value, being 50% of its value paid in the
year following the financial year in question. The amounts related to the non-deferred and deferred portion are paid
50% in cash and 50% in BCP shares. The number of BCP shares attributed results from their valuation at a price defined
in accordance with the approved Remuneration Policy.
The Remuneration Policy for Employees foresees an annual variable remuneration system for Employees not covered by
Commercial Incentives Systems, based on the performance assessment of each employee, in accordance with
quantitative and qualitative criteria, that is carried out annually. As a result of this assessment and the fixed reference
remuneration for the function performed, and provided that the Bank's minimum level of performance in a set of
quantitative indicators is met, the value of the variable remuneration to be attributed to each Employee is decided by
the Executive Committee. For Employees considered as Key Function Holders, the payment of the amount of the
variable remuneration to be attributed to each Employee is decided by the Nominations and Remunerations Committee,
and its payment subject to a deferral period of 5 years for 40% of its value, with 60% of its value paid in the year
following the financial year in question. The amounts related to the non-deferred and deferred portion are paid 50% in
cash and 50% in BCP shares. The number of BCP shares attributed and to be attributed results from their valuation at a
price defined in accordance with the approved Remuneration Policy.
Employees considered as Key Function Holders are not covered by Commercial Incentives Systems.
For the remaining Employees not covered by Commercial Incentive Systems, the payment of the variable remuneration
amount awarded is fully paid in cash in the following year to which it relates.
As foreseen in the approved Remuneration Policy and in the applicable legislation, the amounts of variable
remuneration attributed to the members of the Executive Committee and to the Employees considered as Key Function
Holders are subject to reduction and reversal mechanisms, to be applied in case of verification of extremely significant
events, duly identified, in which the people covered have had a direct participation.
For the members of the Executive Committee, a long-term variable remuneration system is also foreseen, through
which these members may receive variable remuneration fully paid in BCP shares after the end of the assessment
period, from 1 January 2022 until 31 December 2025, provided that a certain level of performance is achieved in a set
of long-term objectives. The amount of the long-term variable remuneration attributed is subject to a deferral period
of 5 years for 50% of its value, being 50% of its value paid in the year following the assessment period to which it
relates. The number of BCP shares attributed results from their valuation at a price defined in accordance with the
approved Remuneration Policy.
All the shares attributed to the members of the Executive Committee and to the Key Function Holders, within the scope
of the payment of variable remuneration, including long-term, are subject to a retention period of 1 year after their
payment.
The total variable remuneration to be attributed, each year, to each member of the Executive Committee and to each
Employee considered as Key Function Holders, regarding the proportion between its amount and the annual fixed
remuneration, is limited to the limits provided in the respective Remuneration Policy.
S.Staff costs
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Remunerations
470,285
455,246
Mandatory social security charges
Post-employment benefits (note 50)
Service cost
(11,727)
(14,466)
Net interest cost / (income) in the liability coverage balance
(5,929)
4,428
Cost with early retirement programs
2,223
36,583
Amount transferred to the Fund resulting from acquired rights
unassigned related to the Complementary Plan
(6)
(586)
(15,439)
25,959
Other mandatory social security charges
104,784
73,183
89,345
99,142
Voluntary social security charges
12,326
11,195
Other staff costs
8,851
88,687
580,807
654,270
The balance Remunerations includes in 2022 the amount of Euros 5,630,000 related to the distribution of profits to
Bank's employees. In 2021, there was no distribution of profits to Bank's employees.
In November 2022, the Bank decided to award an extraordinary payment of Euros 500 to all employees without an
assigned vehicle, which amounted to Euros 2,869,000 reflected in the balance Remunerations. This measure aimed to
contribute to the mitigation of the impact of the current inflationary conjuncture on employees' income.
In 2022, the Bank accounted for in Other costs the amount of Euros 4,414,000 (2021: Euros 84,152,000), referring to
agreements already concluded with some employees whose effective departures will occur during the first half of 2023
(note 39).
This balance also included severance payments in the amount of 1,588,000 (2021: Euros 4,219,000), of which the
highest amounted to Euros 217,000 (2021: Euros 886,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by category:
2022
2021
Portugal
Top Management
854
882
Intermediary Management
1,416
1,508
Specific/Technical functions
2,867
2,976
Other functions
1,119
1,398
6,256
6,764
Abroad
9,314
9,809
15,570
16,573
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories of
employees provided for in Article 115 C no. 2 of the RGICS, as well as the information provided for in Article 450 g) to i)
of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial Portugu\u00eas,
S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2022
2021
2022
2021
Fixed remuneration
3,055
3,055
1,856
1,915
Variable remuneration
Pecuniary
370
246
\u2014
\u2014
Shares
1,322
172
\u2014
\u2014
Deferred
1,024
138
\u2014
\u2014
Supplementary retirement pension
611
611
138
138
Post-employment benefits
(42)
(1)
\u2014
\u2014
Other mandatory social security charges
734
733
443
457
7,074
4,954
2,437
2,510
Number of beneficiaries
6
6
11
11
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity contract,
intends to compensate the functions that are performed in the Bank and in all other functions performed in subsidiaries
or governing bodies for which they have been designated by indication or in representation of the Bank, in the latter
case, the net amount of the remuneration annually received by each member of the Executive Committee will be
deducted from the fixed annual remuneration attributed by the Bank, ensuring that the effective payable amount
corresponds to the one approved by the Remuneration and Welfare Board.
In 2022, the amount of remuneration paid to the Executive Committee includes the amount of Euros 101,000 (2021:
Euros 108,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was Euros 26,000 (2021: Euros 33,000).
In 2022, it was assigned variable remuneration in accordance with the remuneration policies for the members of the
management and supervisory bodies and for employees, approved for 2021, as described in accounting policies 1 R4 and
1 R5.
In 2022, the variable remuneration attributed was Euros 616,000 in cash, of which Euros 246,000 are deferred for 5
years, and 12,416,223 shares corresponding to Euros 2,567,000, of which 1,568,846 shares are deferred for 5 years, and
3,397,643 shares are deferred for 3 years.
In 2021, the deferred variable remuneration attributed to the Executive Committee related to 2020, was Euros 164,000
in cash and 807,882 BCP shares.
In 2022 the deferred variable remuneration from 2021, 2020 and 2019 attributed to the Executive Committee is related
to 2020, 2019 and 2018 years respectively, and amounts to Euros 590,000 in cash and 2,443,549 BCP shares in the
amount of Euros 434,000.
In 2021, the 2019 deferred variable remuneration paid to the Executive Committee relates to the 2018 financial year
and it includes the amount of Euros 89,000 and 347,432 BCP shares in the amount of Euros 49,000.
During 2022 and 2021, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
In 2022, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2022
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,317
2,657
453
2,474
5,041
11,942
Variable remuneration
Pecuniary
129
176
43
224
448
1,020
Shares
80
105
19
139
261
604
Deferred
48
42
9
20
120
239
Post-employment benefits
(112)
(108)
(7)
(191)
(366)
(784)
Other mandatory social security
charges
331
547
111
649
1,209
2,847
1,793
3,419
628
3,315
6,713
15,868
Number of beneficiaries
9
15
2
26
38
90
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2021, as
described in accounting policies 1 R4 and 1 R5, in 2022, the 90 Key Function Holders were awarded with variable
remuneration, in the amount of Euros 236,000 in cash and 1,534,941 shares deferred for 5 years, as well as 174
participation units from AF Fund deferred for 3 years.
In 2022, deferred variable remunerations were paid to KFH deferred from 2021, 2020 and 2019 years, corresponding in
cash to Euros 57,000 and shares in the amount of Euros 182,000.
In 2022, severance payments were paid to 3 KFH in the amount of Euros 255,000, of which the highest payment was
Euros 200,000.
In 2021, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2021
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,188
2,873
450
2,100
4,513
11,124
Variable remuneration
Pecuniary
28
46
6
57
119
256
Shares
20
27
4
29
73
153
Deferred
31
34
6
15
93
179
Post-employment benefits
(76)
(20)
13
(78)
(214)
(375)
Other mandatory social security
charges
292
741
109
530
1,116
2,788
1,483
3,701
588
2,653
5,700
14,125
Number of beneficiaries
8
16
2
22
37
85
As described in accounting policies 1.R4 and 1.R5, during 2021, the 85 Key Function Holders were awarded variable
remuneration arising from the application of the Remuneration Policies for Employees, approved for the financial year
2020, which will be deferred over a period of 5 years, in the amount of Euros 229,000.
In 2021, deferred variable remuneration was paid to KFH deferred from 2020 and 2019, corresponding in cash to Euros
42,000 and shares in the amount of Euros 137,000.
In 2021, severance payments were paid to 3 KFH in the amount of Euros 1,327,000 of which the highest amounts to
Euros 886,000.
In 2022 and 2021, the remunerations and social security charges supported with the Group's Key Function Holders,
discriminated by Key management members and by members whose professional activities have significant impact in
the risk profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management members
Other KFH
Total
2022
2021
2022
2021
2022
2021
Fixed remuneration
7,865
7,431
4,077
3,693
11,942
11,124
Variable remuneration
Pecuniary
705
170
315
86
1,020
256
Shares
417
111
187
42
604
153
Deferred
230
169
9
10
239
179
Post-employment benefits
(453)
(202)
(331)
(173)
(784)
(375)
Other mandatory social security
charges
1,934
1,840
913
948
2,847
2,788
10,698
9,519
5,170
4,606
15,868
14,125
Number of beneficiaries
53
51
37
34
90
85
profit is calculated by the algebraic sum of taxable profits and individual tax losses of the companies that integrate it.
T.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForDeferredIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-615": { "value": "Income taxes
The Group is subject to income tax in several jurisdictions. The Bank is subject, in individual terms, to the regime
established by the Corporate Income Tax Code (CIRC), the Special Regime applicable to Deferred Tax Assets approved
by Law no. 61/2014 of 26 August, to which it adhered, and individual legislation. Additionally, deferred taxes relating
to tax losses and to temporary differences between the accounting net income and the net income accepted by the Tax
Authorities for Income Taxes calculation are accounted for, whenever there is a reasonable probability that these taxes
will be paid or recovered in the future.
Income tax registered in net income for the year comprises current and deferred tax effects. Income tax is recognised
in the income statement, except when related to items recognised directly in equity, which implies its recognition in
equity. Deferred taxes arising from the revaluation of financial assets at fair value through other comprehensive income
and cash flow hedging derivatives are recognised in shareholders\u2019 equity and are recognised after in the income
statement at the moment the profit and loss that originated the deferred taxes are recognised.
Current tax is the value that determines the taxable income for the year, using tax rates enacted or substantively
enacted by authorities at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxes are calculated in accordance with the liability method based on the balance sheet, considering
temporary differences, between the carrying amounts of assets and liabilities and the amounts used for taxation
purposes using the tax rates approved or substantially approved at balance sheet date and that is expected to be
applied when the temporary difference is reversed.
Deferred tax liabilities are recognised for all taxable temporary differences except for non-deductible goodwill for tax
purposes, differences arising from initial recognition of assets and liabilities that affect neither accounting nor taxable
profit and differences relating to investments in subsidiaries to the extent that probably they will not reverse in the
foreseeable future.
The item \u201cDeferred tax assets\u201d includes amounts associated with credit impairments not accepted for tax purposes
whose credits have been written-off, according to the expectation that the use of such impairments will be deductible
for the purposes of determining taxable income for the tax periods in which the legal conditions required for their tax
deductibility are met.
Deferred tax assets are recognised when it is probable that there will be future taxable profits that absorb the
deductible temporary differences for tax purposes (including reportable tax losses).
The Group, as established in IAS 12, paragraph 74, compensates the deferred tax assets and liabilities if, and only if: (i)
it has a legally enforceable right to offset current tax assets and current tax liabilities; and, (ii) the deferred tax assets
and the deferred tax liabilities relate to income taxes released by the same Tax Authority on either the same taxable
entity.
The Group complies with the guidelines of IFRIC 23 \u2013 Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred any material impact on the Bank\u2019s financial statements
resulting from its application.
In 2016, the Bank adhered to the Special Tax Regime for Groups of Companies (RETGS) for the purposes of IRC taxation,
with BCP being the dominant entity. In the financial years of 2022 and 2021, RETGS application was maintained. In
2021, Millennium bcp Participa\u00e7\u00f5es Sociais \u2013 Sociedade Unipessoal, Lda. and BCP \u00c1frica, SGPS, Lda., were included in
the group of companies covered by this regime, being now covered by the general IRC regime. The group's taxable
profit is calculated by the algebraic sum of taxable profits and individual tax losses of the companies that integrate it.
T.Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax determination
is uncertain during the ordinary course of business. Different interpretations and estimations could result in a different
level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in which
the Group considers projections of future taxable income based on a set of assumptions, including the estimate of
income before tax, adjustments to taxable income, evolution of tax legislation and its interpretation. Thus, the
recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors strategy, namely
the ability to generate the estimated taxable income, the evolution of tax law and its interpretation.
Regarding the activity in Portugal, Regulatory Decrees no. 5/2016, of 18 November, no. 11/2017, of 28 December, and
no. of impairment losses and other value corrections for specific credit risk deductible for the purposes of calculating
taxable income based on IRC in the years 2016, 2017 and 2018, respectively. These Regulatory Decrees establish that
Bank of Portugal Notice No. 3/95 (Notice that was relevant for the determination of loan provisions in the financial
statements presented in NCA) must be considered for the purposes of calculating the maximum limits of impairment
losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
Law No. 98/2019, of September 4, established the tax regime for credit impairments and provisions for guarantees for
tax periods beginning on or after January 1, 2019, providing for approximation between accounting rules and tax for
the purposes of deductibility of expenses with the strengthening of credit impairments. The rules in force until 2018
could continue to be applied until the end of the 2023 financial year, unless the option to apply the new regime was
exercised in advance.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, the Bank exercised the option to apply the new regime, under the terms of which the impairment
losses for credit risk relating to exposures analysed on an individual basis or on a collective basis recognized in
accordance with applicable accounting standards and regulations, maintaining the rules in force until 2018 for the
balance of impairment losses and other value adjustments for specific credit risk recorded up to 31 December 2021.
Following the amendments provided for in Law No. 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This amendment
applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax losses calculated in
tax periods prior to January 1, 2023 and whose deduction period is still in progress on that date. Thus, tax losses
calculated in 2014 and subsequent years may be deducted from future taxable income. The deduction limit for tax
losses increased from 70% to 65%, being increased by ten percentage points when the difference results from the
deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of the special regime provided for
in Law n. 27-A/2020, of 24 July 24.
In the projections of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2022, the approximation between the accounting and tax rules
provided for in the aforementioned Law n.\u00ba 98/2019 was considered, of 4 September, taking into account the option for
applying the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the
use of tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any deduction or tax credit being
used, in which the expiry period is the exercise of that right. The Bank recorded provisions or liabilities for deferred
taxes in the amount it considers appropriate to cover tax corrections or tax losses incurred, as well as contingencies
relating to years not yet reviewed by the tax authorities.
Y4.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-616": { "value": "Segmental reporting
The Group adopted IFRS 8 \u2013 Operating Segments for the purpose of disclosing financial information by operating and
geographic segments. A business segment is a Group's component: (i) which develops business activities that can obtain
revenues or expenses; (ii) whose operating results are regularly reviewed by the management with the aim of taking
decisions about allocating resources to the segment and assess its performance; and, (iii) for which separate financial
information is available.
The Group controls its activity through the following major operating segments:
Portugal activity:
\u2013Retail Banking, also including ActivoBank;
\u2013Companies, Corporate and Investment Banking;
\u2013Private Banking;
\u2013Other.
The Other segment (Portugal activity) includes activities that are not allocated to remaining segments, namely
centralized management of financial investments, corporate activities, and insurance activity.
Foreign activity:
\u2013Poland;
\u2013Mozambique;
\u2013Other.
The \"Other\" segment (foreign activity) includes the activity arising from the discontinued operations in Switzerland and
Cayman Islands (operation liquidated in 2022) and also the contribution of the participation in an associate in Angola. It
should be noted that, following the sale of the operation in Switzerland on 2 November 2021, the subsidiary's net
income in December 2021and the capital gain generated with the sale of the entire shareholding in Banque Priv\u00e9e BCP
(as well as the adjustments occurred in 2022), are reflected as income arising from discontinued operations, as
provided for in IFRS 5.
U.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForSegmentReportingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-617": { "value": "Provisions
Provisions are recognised when (i) the Group has a present obligation (legal or resulting from past practices or
published policies that imply the recognition of certain responsibilities); (ii) it is probable that a payment will be
required to settle; and, (iii) a reliable estimation can be made of the amount of the obligation.
Additionally, when fundamental reorganizations occur that have a material effect on the nature and focus of the
company's operations, and the criteria for recognition of provisions referred to above are met, provisions are
recognized for restructuring costs.
The measurement of provisions considers the principles set in IAS 37 regarding the best estimate of the expected cost,
the most likely result of current actions and considering the risks and uncertainties inherent to the process result. On
the cases that the discount effect is material, provision corresponds to the actual value of the expected future
payments, discounted at a rate that considers the associated risk of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the best estimate, being reverted through
profit and loss in the proportion of the payments that are not probable.
Provisions are derecognised through their use in the obligations for which they were initially created, or in the case
that these obligations cease to exist.
Provisions for risk associated with mortgage loans indexed to the Swiss franc
The Group creates provisions for legal contingencies related to mortgage loans indexed to the Swiss franc granted by
Bank Millennium, S.A.
The assumptions used by the Bank are essentially based on historical observations and will have to be updated in
subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The methodology developed by
the Bank is based on the following parameters: (i) the number of current (including class actions) and potential future
court cases that will appear within a specified time horizon; (ii) the amount of the Bank\u2019s potential loss in the event of
a specific court judgment (three negative judgment scenarios were taken into account); (iii) the probability of
obtaining a specific court verdict calculated on the basis of statistics of judgments of the banking sector in Poland and
legal opinions obtained; (iv) in the case of a loan agreement invalidity scenario, the Bank Millennium's loss is calculated
taking into account the assignment of a minimum probability of receiving the settlement of a remuneration for the cost
of use of capital; and (v) amicable settlement with clients in or out of court.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the swiss franc and the
amount of the Bank\u2019s actual losses depend, namely, on the number of ongoing and potential lawsuits, as well as on the
final court decisions about each case and amicable settlement with clients.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForProvisionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-618": { "value": "Contingent assets
Contingent assets are not recognised in the financial statements and are disclosed when a future economic inflow of
resources is probable.
U3.Contingent liabilities
Contingent liabilities are not recognised in the financial statements, being framed under IAS 37 whenever the possibility
of an outflow of resources regarding economic benefits is not remote. The Group registers a contingent liability when:
i)it is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence
or non- occurrence of one or more uncertain future events that are not wholly within the control of the Group; or,
ii)it is a present obligation that arises from past events but is not recognised because:
a)it is not probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; or,
b)the amount of the obligation cannot be measured with sufficient reliability.
The contingent liabilities identified are subject to disclosure, unless the possibility of an outflow of resources
incorporating economic benefits is remote.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForContingentLiabilitiesAndContingentAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-619": { "value": "Earnings per share
Basic earnings per share are calculated by dividing net income attributable to shareholders of the Group by the
weighted average number of ordinary shares outstanding, excluding the average number of ordinary shares purchased
by the Group and held as treasury shares.
For the diluted earnings per share, the weighted average number of ordinary shares outstanding is adjusted to consider
conversion of all dilutive potential ordinary shares. Potential or contingent share issues are treated as dilutive when
their conversion to shares would decrease net earnings per share. If the earnings per share are changed because of an
issue with premium or discount or other event that changed the potential number of ordinary shares or because of
changes in the accounting policies, the earnings per share for all presented periods should be adjusted retrospectively.
W.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForEarningsPerShareExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-620": { "value": "Insurance contracts
W1.Classification
The Group issues contracts that contain insurance risk, financial risk or a combination of both insurance and financial
risk. A contract, under which the Group accepts significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in accordance with
the accounting policies applicable to insurance contracts. A contract issued by the Group that transfers only financial
risk, without discretionary participating features, is accounted for as a financial instrument.
W2.Recognition and measurement
Premiums of life insurance and investment contracts with discretionary participating features, which are considered as
long-term contracts are recognised as income when due from the policyholders. The benefits and other costs are
recognised concurrently with the recognition of income over the life of the contracts. This specialization is achieved
through the establishment of provisions/liabilities of insurance contracts and investment contracts with discretionary
participating features.
The responsibilities correspond to the present value of future benefits payable, net of administrative expenses directly
associated with the contracts, less the theoretical premiums that would be required to comply with the established
benefits and related expenses. The liabilities are determined based on assumptions of mortality, costs of management
or investment at the valuation date.
For contracts where the payment period is significantly shorter than the period of benefit, premiums are deferred and
recognised as income in proportion to the duration period of risk coverage. Regarding short-term contracts, including
contracts of non-life insurance, premiums are recorded at the time of issue. The award is recognised as income
acquired on a pro-rata basis during the term of the contract. The provision for unearned premiums represents the
amount of issued premiums on risks not occurred.
W3.Premiums
Issued gross premiums are recognised for as income in the period to which they respect independently from the
moment of payment or receivable, in accordance with the accrual accounting principle. Reinsurance premiums ceded
are accounted for as expense in the period to which they respect in the same way as gross premiums written.
W4.Provision for unearned premiums from direct insurance and reinsurance premiums ceded
The provision for unearned gross premiums is based on the evaluation of the premiums written before the end of the
year but for which the risk period continues after the year end. This provision is calculated using the pro-rata temporis
method applied to each contract in force.
W5.Liability adequacy test
At each reporting date, the Group evaluates the adequacy of liabilities arising from insurance contracts and investment
contracts with discretionary participating features. The evaluation of the adequacy of responsibilities is made based on
the projection of future cash flows associated with each contract, discounted at market interest rate without risk. This
evaluation is done product by product or aggregate of products when the risks are similar or managed jointly. Any
deficiency, if exists, is recorded in the Group's results as determined.
X.Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorized by Autoridade de Supervis\u00e3o de Seguros e
Fundos de Pens\u00f5es (ASF) for the practice of insurance intermediation in the category of Linked Insurance Broker, in
accordance with Article 8, paragraph a), subparagraph i) of Decree-Law no. 144/2006, of 31 July, carrying out
insurance intermediation activities in life and non-life segments.
Within the scope of insurance intermediation services, these banks perform the sale of insurance contracts. As
compensation for insurance intermediation services, they receive commissions for arranging insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurance Companies.
Commissions received for insurance intermediation are recognised in accordance with the accrual accounting principle,
so the commissions whose receipt occurs at a different time from the period to which they refer are recognised as an
amount receivable under the item \"Other assets\". Commissions received for insurance mediation services are recognized
in accordance with the policy described in note I. Recognition of income from services and commissions.
Y.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForInsuranceContracts", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-621": { "value": "Insurance contracts
W1.Classification
The Group issues contracts that contain insurance risk, financial risk or a combination of both insurance and financial
risk. A contract, under which the Group accepts significant insurance risk from another party, by agreeing to
compensate that party on the occurrence of a specified uncertain future event, is classified as an insurance contract.
A contract issued by the Group without significant insurance risk, but on which financial risk is transferred with
discretionary participating features is classified as an investment contract recognised and measured in accordance with
the accounting policies applicable to insurance contracts. A contract issued by the Group that transfers only financial
risk, without discretionary participating features, is accounted for as a financial instrument.
W2.Recognition and measurement
Premiums of life insurance and investment contracts with discretionary participating features, which are considered as
long-term contracts are recognised as income when due from the policyholders. The benefits and other costs are
recognised concurrently with the recognition of income over the life of the contracts. This specialization is achieved
through the establishment of provisions/liabilities of insurance contracts and investment contracts with discretionary
participating features.
The responsibilities correspond to the present value of future benefits payable, net of administrative expenses directly
associated with the contracts, less the theoretical premiums that would be required to comply with the established
benefits and related expenses. The liabilities are determined based on assumptions of mortality, costs of management
or investment at the valuation date.
For contracts where the payment period is significantly shorter than the period of benefit, premiums are deferred and
recognised as income in proportion to the duration period of risk coverage. Regarding short-term contracts, including
contracts of non-life insurance, premiums are recorded at the time of issue. The award is recognised as income
acquired on a pro-rata basis during the term of the contract. The provision for unearned premiums represents the
amount of issued premiums on risks not occurred.
W3.Premiums
Issued gross premiums are recognised for as income in the period to which they respect independently from the
moment of payment or receivable, in accordance with the accrual accounting principle. Reinsurance premiums ceded
are accounted for as expense in the period to which they respect in the same way as gross premiums written.
W4.Provision for unearned premiums from direct insurance and reinsurance premiums ceded
The provision for unearned gross premiums is based on the evaluation of the premiums written before the end of the
year but for which the risk period continues after the year end. This provision is calculated using the pro-rata temporis
method applied to each contract in force.
W5.Liability adequacy test
At each reporting date, the Group evaluates the adequacy of liabilities arising from insurance contracts and investment
contracts with discretionary participating features. The evaluation of the adequacy of responsibilities is made based on
the projection of future cash flows associated with each contract, discounted at market interest rate without risk. This
evaluation is done product by product or aggregate of products when the risks are similar or managed jointly. Any
deficiency, if exists, is recorded in the Group's results as determined.
X.Insurance or reinsurance intermediation services
Banco Comercial Portugu\u00eas and Banco ActivoBank are entities authorized by Autoridade de Supervis\u00e3o de Seguros e
Fundos de Pens\u00f5es (ASF) for the practice of insurance intermediation in the category of Linked Insurance Broker, in
accordance with Article 8, paragraph a), subparagraph i) of Decree-Law no. 144/2006, of 31 July, carrying out
insurance intermediation activities in life and non-life segments.
Within the scope of insurance intermediation services, these banks perform the sale of insurance contracts. As
compensation for insurance intermediation services, they receive commissions for arranging insurance contracts and
investment contracts, which are defined in agreements/protocols established with the Insurance Companies.
Commissions received for insurance intermediation are recognised in accordance with the accrual accounting principle,
so the commissions whose receipt occurs at a different time from the period to which they refer are recognised as an
amount receivable under the item \"Other assets\". Commissions received for insurance mediation services are recognized
in accordance with the policy described in note I. Recognition of income from services and commissions.
Y.
Under the scope of the Group's insurance mediation activities, the remuneration from services provided is analysed as
follows:\u00a0
(Thousands of euros)
2022
2021
Life insurance
Saving products
27,966
32,101
Mortgage and consumer loans
20,699
19,333
Others
\u2014
30
48,665
51,464
Non-Life insurance
Accidents and health
21,612
20,144
Motor
3,956
4,078
Multi-Risk Housing
7,753
7,392
Others
1,660
1,549
34,981
33,163
83,646
84,627
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.Income taxes
Interpretations and estimations were required to determine the total amount of income taxes in each of the
jurisdictions where the Group operates. There are many transactions and calculations for which the tax determination
is uncertain during the ordinary course of business. Different interpretations and estimations could result in a different
level of income taxes, current and deferred, recognised in the year.
This aspect assumes greater relevance for the purposes of the analysis of the recoverability of deferred taxes, in which
the Group considers projections of future taxable income based on a set of assumptions, including the estimate of
income before tax, adjustments to taxable income, evolution of tax legislation and its interpretation. Thus, the
recoverability of deferred tax assets depends on the implementation of the Bank's Board of Directors strategy, namely
the ability to generate the estimated taxable income, the evolution of tax law and its interpretation.
Regarding the activity in Portugal, Regulatory Decrees no. 5/2016, of 18 November, no. 11/2017, of 28 December, and
no. of impairment losses and other value corrections for specific credit risk deductible for the purposes of calculating
taxable income based on IRC in the years 2016, 2017 and 2018, respectively. These Regulatory Decrees establish that
Bank of Portugal Notice No. 3/95 (Notice that was relevant for the determination of loan provisions in the financial
statements presented in NCA) must be considered for the purposes of calculating the maximum limits of impairment
losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
Law No. 98/2019, of September 4, established the tax regime for credit impairments and provisions for guarantees for
tax periods beginning on or after January 1, 2019, providing for approximation between accounting rules and tax for
the purposes of deductibility of expenses with the strengthening of credit impairments. The rules in force until 2018
could continue to be applied until the end of the 2023 financial year, unless the option to apply the new regime was
exercised in advance.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, the Bank exercised the option to apply the new regime, under the terms of which the impairment
losses for credit risk relating to exposures analysed on an individual basis or on a collective basis recognized in
accordance with applicable accounting standards and regulations, maintaining the rules in force until 2018 for the
balance of impairment losses and other value adjustments for specific credit risk recorded up to 31 December 2021.
Following the amendments provided for in Law No. 24-D/2022, of 30 December, within the scope of the State Budget
for 2023, the time limit applicable to the carrying forward of tax losses in Portugal was eliminated. This amendment
applies to tax losses calculated in tax periods beginning on or after 1 January 2023, as well as to tax losses calculated in
tax periods prior to January 1, 2023 and whose deduction period is still in progress on that date. Thus, tax losses
calculated in 2014 and subsequent years may be deducted from future taxable income. The deduction limit for tax
losses increased from 70% to 65%, being increased by ten percentage points when the difference results from the
deduction of tax losses calculated in the 2020 and 2021 tax periods, under the terms of the special regime provided for
in Law n. 27-A/2020, of 24 July 24.
In the projections of future taxable income, namely for purposes of the analysis of the recoverability of deferred taxes
assets carried out with reference to 31 December 2022, the approximation between the accounting and tax rules
provided for in the aforementioned Law n.\u00ba 98/2019 was considered, of 4 September, taking into account the option for
applying the new regime exercised in 2022, as well as the changes in terms of the elimination of the time limit on the
use of tax losses provided for in said Law no. 24-D/2022, of 30 December.
The taxable profit or tax loss calculated by the Bank or its subsidiaries residing in Portugal can be corrected by the
Portuguese tax administration within a period of four years, except in the case of any deduction or tax credit being
used, in which the expiry period is the exercise of that right. The Bank recorded provisions or liabilities for deferred
taxes in the amount it considers appropriate to cover tax corrections or tax losses incurred, as well as contingencies
relating to years not yet reviewed by the tax authorities.
Y4.Non-current assets held for sale (real estate) valuation
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Bank's historical experience in the commercialization of real estate, its perspectives on the evolution
of the real estate market and the intentions of the management body regarding the commercialization of these assets.
The assumptions used in the valuations of these assets have an impact on their valuation and consequently on the
determination of impairment.
Y5.Pension and other employees\u2019 benefits
Determining pension liabilities requires the use of assumptions and estimations, including the use of actuarial
projections, estimated returns on investment, and other factors, such as discount rate, pensions and salary growth
rates, mortality tables, that could impact the cost and liability of the pension plan.
As defined by IAS 19, the discount rate used to update the responsibilities of the Bank's pension fund is based on an
analysis performed over the market yields regarding a bond issues universe \u2013 that the Group considers having high
quality (low risk), different maturities (appropriate to the period of liquidation of the fund's liabilities) and
denominated in euros - related to a diverse and representative range of issuers.
Y6.Financial instruments \u2013 IFRS 9
Y6.1.Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and interest
on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed together to
achieve a specific business objective. This evaluation requires judgment, since the following aspects, among others,
must be considered: the way in which the performance of assets is evaluated; the risks that affect the performance of
the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other comprehensive
income that are derecognised prior to their maturity to understand the underlying reasons for their disposal and to
determine whether they are consistent with the purpose of the business model defined for these assets. This monitoring
is part of a process of continuous evaluation by the Group of the business model of the financial assets that remain in
the portfolio, to determine if it is adequate and, if it is not, if there was a change in the business model and,
consequently, a prospective classification change of these financial assets.
Y6.2.Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
Y6.3.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7. Provisions for risk associated with mortgage loans indexed to the Swiss franc
The Group creates provisions for legal contingencies related to mortgage loans indexed to the Swiss franc granted by
Bank Millennium, S.A.
The assumptions used by the Bank are essentially based on historical observations and will have to be updated in
subsequent periods, which may have a relevant impact on the provision\u2019s estimation. The methodology developed by
the Bank is based on the following parameters: (i) the number of current (including class actions) and potential future
court cases that will appear within a specified time horizon; (ii) the amount of the Bank\u2019s potential loss in the event of
a specific court judgment (three negative judgment scenarios were taken into account); (iii) the probability of
obtaining a specific court verdict calculated on the basis of statistics of judgments of the banking sector in Poland and
legal opinions obtained; (iv) in the case of a loan agreement invalidity scenario, the Bank Millennium's loss is calculated
taking into account the assignment of a minimum probability of receiving the settlement of a remuneration for the cost
of use of capital; and (v) amicable settlement with clients in or out of court.
The evolution of responsibilities with legal contingencies related to mortgage loans indexed to the swiss franc and the
amount of the Bank\u2019s actual losses depend, namely, on the number of ongoing and potential lawsuits, as well as on the
final court decisions about each case and amicable settlement with clients.
", "dimensions": { "concept": "ifrs-full:DisclosureOfAccountingJudgementsAndEstimatesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-625": { "value": "Goodwill impairment
The recoverable amount of the goodwill recorded in the Group's assets is assessed annually in the preparation of
accounts with reference to the end of the year or whenever there are indications of eventual loss of value. For this
purpose, the carrying amount of the business units of the Group for which goodwill has been recognised is compared
with the respective recoverable amount. A goodwill impairment loss is recognised when the carrying amount of the
business unit exceeds the respective recoverable amount.
In the absence of an available market value, the recoverable amount is determined using cash flows predictions,
applying a discount rate that includes a risk premium appropriated to the business unit being tested. Determining the
cash flows to discount and the discount rate, involves judgment.
Y3.Impairment of financial assets at amortised cost
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Loans and advances to credit institutions (note 21)
Charge for the year
349
911
Reversals for the year
(673)
(27)
(324)
884
Loans and advances to customers (note 22)
Charge for the year
830,750
861,212
Reversals for the year
(506,926)
(487,084)
Recoveries of loans and interest charged-off
(20,836)
(22,938)
302,988
351,190
Debt securities (note 23)
Associated to credit operations
Charge for the year
8
244
Reversals for the year
(2,393)
(2,533)
(2,385)
(2,289)
Not associated to credit operations
Charge for the year
3,329
4,874
Reversals for the year
(2,779)
(1,826)
550
3,048
(1,835)
759
300,829
352,833
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,849,284
2,036,522
Charge for the year in net income interest
32,942
25,935
Transfers resulting from changes in the Group's structure
\u2014
(375)
Other transfers
(53,634)
4,778
Impairment charge for the year (note 11)
830,750
861,212
Reversals for the year (note 11)
(506,926)
(487,084)
Loans charged-off
Write-offs
(458,405)
(372,710)
Credit assignments
(189,061)
(227,470)
Exchange rate differences
(2,577)
8,476
Balance at the end of the year
1,502,373
1,849,284
\u2014
(4,557)
Impairment charge for the year (note 13)
1,435
\u2014
Impairment\u00a0 write-off\u00a0 (Banco Millennium Atl\u00e2ntico, S.A.)
(16,787)
\u2014
Exchange rate differences
(1,653)
7,966
Balance at the end of the year
66,263
78,268
Internacional de Mo\u00e7ambique)
(1,038)
(375)
Other transfers
908
536
Charge for the year (note 12)
17,699
16,618
Reversals for the year (note 12)
(7,047)
(9,263)
Amounts charged-off
(78,835)
(12,717)
Exchange rate differences
(134)
58
Balance at the end of the year
191,752
260,199
Additionally, are booked in Loans and advances to customer\u2019s portfolio and in balances Guarantees granted and
Irrevocable credit lines, the following exposures and respective impairment, in relation to entities controlled by these
funds:
(Thousands of euros)
Items
2022
2021
Loans and advances to customers
248,439
110,786
Guarantees granted and irrevocable credit lines
74,834
41,244
Gross exposure
323,273
152,030
Impairment
(15,183)
(22,445)
Net exposure
308,090
129,585
Project Crow
As at 31 December 2022, the financial instruments subject to impairment requirements under IFRS 9, (do not include
equity instruments as accounting policy 1.C1.1.2, analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2022
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
964,296
\u2014
\u2014
\u2014
964,296
Loans and advances to customers (note 22)
46,395,996
7,564,235
2,170,979
46,956
56,178,166
Debt instruments (note 23)
12,990,232
55,787
3,802
\u2014
13,049,821
Debt instruments at fair value through other
comprehensive income (note 24) (*)
7,434,152
\u2014
1,067
\u2014
7,435,219
Guarantees and other commitments (note 45) (**)
14,303,231
1,768,595
364,691
921
16,437,438
Total
82,087,907
9,388,617
2,540,539
47,877
94,064,940
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
(Thousands of euros)
Category
2022
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
862
\u2014
\u2014
\u2014
862
Loans and advances to customers (note 22)
214,470
284,448
985,557
17,898
1,502,373
Debt instruments (note 23)
13,409
720
110
\u2014
14,239
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,067
\u2014
1,067
Guarantees and other commitments (note 39) (**)
11,307
14,893
84,435
119
110,754
Total
240,048
300,061
1,071,169
18,017
1,629,295
(Thousands of euros)
Category
2022
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
963,434
\u2014
\u2014
\u2014
963,434
Loans and advances to customers (note 22)
46,181,526
7,279,787
1,185,422
29,058
54,675,793
Debt instruments (note 23)
12,976,823
55,067
3,692
\u2014
13,035,582
Debt instruments at fair value through other
comprehensive income (note 24) (*)
7,434,152
\u2014
\u2014
\u2014
7,434,152
Guarantees and other commitments (note 45) (**)
14,291,924
1,753,702
280,256
802
16,326,684
Total
81,847,859
9,088,556
1,469,370
29,860
92,435,645
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
As at 31 December 2021, the financial instruments subject to impairment requirements under IFRS 9 (do not include
equity instruments as accounting policy 1.C1.1.2, analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2021
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,287
5,113
\u2014
\u2014
454,400
Loans and advances to customers (note 22)
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Debt instruments (note 23)
8,094,290
122,257
4,451
\u2014
8,220,998
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
1,092
\u2014
12,857,257
Guarantees and other commitments (note 45) (**)
13,462,773
1,922,031
412,179
\u2014
15,796,983
Total
80,976,168
10,013,453
3,103,989
57,713
94,151,323
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
(Thousands of euros)
Category
2021
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
128
1,059
\u2014
\u2014
1,187
Loans and advances to customers (note 22)
207,328
288,642
1,336,612
16,702
1,849,284
Debt instruments (note 23)
13,187
2,517
98
\u2014
15,802
Debt instruments at fair value through other
comprehensive income (note 23) (*)
\u2014
\u2014
1,092
\u2014
1,092
Guarantees and other commitments (note 39) (**)
12,848
13,033
84,768
\u2014
110,649
Total
233,491
305,251
1,422,570
16,702
1,978,014
(Thousands of euros)
Category
2021
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,159
4,054
\u2014
\u2014
453,213
Loans and advances to customers (note 22)
45,906,325
7,675,410
1,349,655
41,011
54,972,401
Debt instruments (note 23)
8,081,103
119,740
4,353
\u2014
8,205,196
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
\u2014
\u2014
12,856,165
Guarantees and other commitments (note 45) (**)
13,449,925
1,908,998
327,411
\u2014
15,686,334
Total
80,742,677
9,708,202
1,681,419
41,011
92,173,309
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
During 2022, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2022
Financial assets at amortised cost - Loans and advances to customers
impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
207,328
288,642
1,336,612
16,702
1,849,284
Change in impairment losses:
Transfer to Stage 1
50,530
(50,139)
(4,778)
4,387
\u2014
Transfer to Stage 2
(14,016)
47,552
(33,614)
78
\u2014
Transfer to Stage 3
(4,314)
(55,508)
58,004
1,818
\u2014
Changes occurred due to changes in credit risk
(51,425)
25,711
196,355
4,816
175,457
Write-offs
(922)
(2,996)
(440,667)
(13,820)
(458,405)
Changes due to new financial assets and derecognised
financial assets and other variations
27,289
31,186
(126,355)
3,917
(63,963)
Impairment losses at the end of the year
214,470
284,448
985,557
17,898
1,502,373
During 2021, the changes occurred in Loans and advances to customers - impairment are as follows:
(Thousands of euros)
2021
Financial assets at amortised cost - Loans and advances to customers
impairment
Stage 1
Stage 2
Stage 3
POCI
Total
Impairment losses as at 1 January
169,103
247,252
1,607,223
12,944
2,036,522
Change in impairment losses:
Transfer to Stage 1
56,037
(48,127)
(7,908)
(2)
\u2014
Transfer to Stage 2
(14,166)
35,066
(20,900)
\u2014
\u2014
Transfer to Stage 3
(4,097)
(27,345)
31,505
(63)
\u2014
Changes occurred due to changes in credit risk
(17,162)
29,604
188,368
5,165
205,975
Write-offs
(3,261)
(2,370)
(362,075)
(5,004)
(372,710)
Changes due to new financial assets and derecognised
financial assets and other variations
21,242
54,562
(99,601)
3,662
(20,135)
Transfers resulting from changes in the Group's structure
(Banque Priv\u00e9e BCP (Suisse))
(368)
\u2014
\u2014
\u2014
(368)
Impairment losses at the end of the year
207,328
288,642
1,336,612
16,702
1,849,284
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based on
expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2022
2021
Amortised cost before changes
396,049
612,501
Impairment losses before changes
(47,337)
(87,268)
Net amortised cost before changes
348,712
525,233
Net gain/loss arising on changes
(32,993)
(7,949)
Net amortised cost after changes
315,719
517,284
", "dimensions": { "concept": "ifrs-full:DisclosureOfImpairmentOfAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-626": { "value": "Non-current assets held for sale (real estate) valuation
The valuation of these assets, and consequently the impairment losses, is supported by evaluations carried out by
external experts, which incorporate several assumptions, namely the selling price per square meter, discount rate,
better use of the real estate and expectations regarding the development of real estate projects, as applicable, and
also considers the Bank's historical experience in the commercialization of real estate, its perspectives on the evolution
of the real estate market and the intentions of the management body regarding the commercialization of these assets.
The assumptions used in the valuations of these assets have an impact on their valuation and consequently on the
determination of impairment.
Y5.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForImpairmentOfNonfinancialAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-627": { "value": "Classification and measurement
The classification and measurement of financial assets depends on the results of the SPPI test (analysis of the
characteristics of the contractual cash flows to determine if they correspond only to payments of principal and interest
on the outstanding capital) and the testing of the business model.
The Group determines the business model at a level that reflects how financial asset groups are managed together to
achieve a specific business objective. This evaluation requires judgment, since the following aspects, among others,
must be considered: the way in which the performance of assets is evaluated; the risks that affect the performance of
the assets and the way these risks are managed; and how asset managers are rewarded.
The Group monitors the financial assets measured at amortised cost and at fair value through other comprehensive
income that are derecognised prior to their maturity to understand the underlying reasons for their disposal and to
determine whether they are consistent with the purpose of the business model defined for these assets. This monitoring
is part of a process of continuous evaluation by the Group of the business model of the financial assets that remain in
the portfolio, to determine if it is adequate and, if it is not, if there was a change in the business model and,
consequently, a prospective classification change of these financial assets.
Y6.2.Impairment losses on financial assets at amortised cost and debt instruments at fair value through
other comprehensive income
The determination of impairment losses on financial instruments involves judgments and estimations regarding, among
others, the following:
Significant increase in credit risk:
Impairment losses correspond to the expected losses on a 12-month for the assets in Stage 1 and the expected losses
considering the probability of a default event occurring at some point up to the maturity date of the instrument
financial assets for assets in Stages 2 and 3. An asset is classified in Stage 2 whenever there is a significant increase in
its credit risk since its initial recognition. In assessing the existence of a significant increase in credit risk, the Group
considers qualitative and quantitative information, reasonable and sustainable.
In order to comply with the Supervisors' guidelines, namely regarding to the identification and measurement of credit
risk in the context of of uncertainty associated with the current geopolitical crisis, the disruption in distribution chains,
rising energy costs and inflationary pressures, the Bank proceeded to record additional impairments in relation to the
current models of collective impairment calculation (overlays).
The exercise carried out was based on an analysis of migrations from customers identified as having the highest risk for
Stage 2 and Stage 3, with the greatest impact on the corporate segment.
Definition of groups of assets with common credit risk characteristics:
When expected credit losses are measured on a collective basis, the financial instruments are grouped based on
common risk characteristics. The Group monitors the adequacy of credit risk characteristics on a regular basis to assess
whether it maintains its similarity. This procedure is necessary to ensure that, in the event of a change in the credit
risk characteristics, the asset segmentation is reviewed. This review may result in the creation of new portfolios or in
transferring assets to existing portfolios that better reflect their credit risk characteristics.
Definition of the number and relative weight of prospective information for each type of product/market and
determination of relevant prospective information:
In estimating expected credit losses, the Group uses reasonable and sustainable forecasting information that is based
on assumptions about the future evolution of different economic drivers and how each of the drivers impacts the
remaining drivers.
Probability of default:
The probability of default represents a determining factor in the measurement of expected credit losses and
corresponds to an estimation of the probability of default in each period, which is calculated based on historical data,
assumptions and expectations about future conditions.
Loss given default:
It corresponds to a loss estimation in a default scenario. It is based on the difference between the contractual cash
flows and those that the Bank expects to receive, through the cash flows generated by the customers' business or credit
collaterals. The estimation of loss given default is based on, among other aspects, the different recovery scenarios,
historical information, the costs involved in the recovery process and the estimation of the valuation of collaterals
associated with credit operations.
Y6.3.Fair value of derivative financial instruments
Fair values are based on listed market prices if available, otherwise fair value is determined either by dealer price
quotations (either for that transaction or for similar instruments traded) or by pricing models, based on net present
value of estimated future cash flows which considers the market conditions for the underlying instruments, time value,
yield curve and volatility factors. These pricing models may require assumptions or judgments in estimating their fair
values. Consequently, the use of a different model or of different assumptions or judgments in applying a particular
model could result in different results from the ones reported.
Due to market stress conditions, the Bank needed to reallocate the risk limits, especially in the sensitivity limit of the
trading portfolio and to review the stress-test scenarios and their methodologies.
In the context of the uncertainty associated with the current macroeconomic framework, the calculation of fair value
adjustments was revised considering liquidity discounts, the costs of closing positions (widening the buy and sell
spread), credit risk, spreads of financing and increased volatility.
Y7.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-628": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Dividends from financial assets held for trading
\u2014
6
Dividends from financial assets through other comprehensive income
10,086
932
10,086
938
The balances Dividends from financial assets through other comprehensive income include in 2022 dividends from
shares of Octal Group Lda in the amount of Euros 7,950,000 and of Tiicc, Sarl in the amount of Euros 1,325,000. This
balance also includes income from investment fund units received during the year.
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Fees and commissions received
Banking services provided
484,454
447,002
Management and maintenance of accounts
170,372
149,847
Bancassurance
121,824
119,395
Securities operations
70,775
67,192
Guarantees granted
46,834
44,171
Commitments to third parties
5,195
5,307
Management and intervention commissions
23,624
22,779
Fiduciary and trust activities
31
\u2014
Other commissions
20,665
19,571
943,774
875,264
Fees and commissions paid
Banking services provided by third parties
(132,751)
(114,476)
Securities operations
(8,991)
(8,514)
Guarantees received
(7,699)
(1,954)
Other commissions
(22,425)
(22,597)
(171,866)
(147,541)
771,908
727,723
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-629": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-630": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRevenueFromContractsWithCustomersExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-631": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Dividends from financial assets held for trading
\u2014
6
Dividends from financial assets through other comprehensive income
10,086
932
10,086
938
The balances Dividends from financial assets through other comprehensive income include in 2022 dividends from
shares of Octal Group Lda in the amount of Euros 7,950,000 and of Tiicc, Sarl in the amount of Euros 1,325,000. This
balance also includes income from investment fund units received during the year.
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Fees and commissions received
Banking services provided
484,454
447,002
Management and maintenance of accounts
170,372
149,847
Bancassurance
121,824
119,395
Securities operations
70,775
67,192
Guarantees granted
46,834
44,171
Commitments to third parties
5,195
5,307
Management and intervention commissions
23,624
22,779
Fiduciary and trust activities
31
\u2014
Other commissions
20,665
19,571
943,774
875,264
Fees and commissions paid
Banking services provided by third parties
(132,751)
(114,476)
Securities operations
(8,991)
(8,514)
Guarantees received
(7,699)
(1,954)
Other commissions
(22,425)
(22,597)
(171,866)
(147,541)
771,908
727,723
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
Other operating income / (losses)
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
adjustments due to derivatives and intra group liabilities and on a risk factor adjustment that depends on the risk
profile of the institution.
In accordance with Article 67(4) of SRM Regulation and in accordance with the Intergovernmental Agreement on the
transfer and mutualisation of contributions to the SRF, the ex-ante contributions are collected by national resolution
authorities and transferred to the SRF by 30 June of each year.
The Group delivered in 2022 the amount of Euros 25,847,000 to the Single Resolution Fund (2021: Euros 20,886,000).
The total value of the contribution attributable to the Group amounted to Euros 30,400,000 (2021: Euros 24,563,000)
and the Group opted to constitute an irrevocable commitment, through the constitution of a bailment for this purpose,
in the amount of Euros 4,553,000 (2021: Euros 3,677,000), not having this component been recognised as a cost, as
defined by the Single Resolution Council in accordance with the methodology set out in Delegated Regulation (EU) No
2015/63 of the Commission of 21 October 2014 and with the conditions laid down in the Implementing Regulation (EU)
2015/81 of the Council of 19 December 2014. As at 31 December 2022, the total amount of irrevocable commitments
constituted is Euros 25,506,000 (31 December 2021: Euros 20,953,000), registered in Other assets - Deposit account
applications (note 32).
The balance Institutional protection scheme (Poland), corresponds to the contribution of Bank Millennium to the
recently created polish Institutional Protection Scheme.
The Management Board of the Bank Millennium S.A. received information on 7 June 2022, that the Management Boards
and Supervisory Boards of Alior Bank S.A., Bank Millennium S.A. Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska
S.A., ING Bank \u015al\u0105ski S.A., mBank S.A., Powszechna Kasa Oszcz\u0119dno\u015bci Bank Polski S.A., Santander Bank Polska S.A.
(Member Banks) had passed resolutions on consenting to submitting an application to the Polish Financial Supervision
Authority for approval and recognition of the protection scheme, the members of which are banks operating in the form
of a joint-stock company together with the draft agreement on the protection scheme, i.e. Member Bank\u2019s
participation in the creation of the protection scheme referred to in Article 4 no.1(9a) of the Banking Law Act of 29
August 1997.
The objective of the protection scheme is to:
1. ensure liquidity and solvency of the Member Banks on the terms and conditions and to the extent set out in the
agreement on the protection scheme; and
2. support: a) the resolution procedure pursued by the Bank Guarantee Fund (BGF) for the bank being a joint-stock
company; and b) acquisition of the bank being a joint-stock company under Article 146b.1 of the Banking Law.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-632": { "value": "Net interest income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The balance Interest on deposits at Central Banks and on loans and advances to credit institutions repayable on demand
has accounted for a negative interest of Euros 6,572,000 (2021: Euros 6,737,000) associated with demand deposits with
the Bank of Portugal (do not include overnight operations).
The balance Interest on financial assets at amortised cost - Loans and advances to customers includes the amount of
Euros 55,967,000 (2021: Euros 18,008,000) related to commissions and other gains accounted for under the effective
interest method, as referred in the accounting policy described in note 1 C3. The balance also includes the amount of
Euros 76,249,000 (2021: Euros 58,881,000) related to interest income arising from customers classified in stage 3.\u00a0
The balances Interest on non-subordinated debt securities issued and Interest on subordinated debt include the amount
of Euros 2,553,000 and Euros 970,000, respectively (2021: Euros 2,669,000 and Euros 5,356,000, respectively) related to
commissions and other costs accounted for under the effective interest method, as referred in the accounting policy
described in note 1 C3.
The balance Interest expense and similar charges - Interest on financial liabilities at amortised cost - Resources from
credit institutions has recorded in 2022 a negative cost of Euros 41,555,000 (2021: a negative cost of Euros 81,266,000)
associated with the TLTRO III operation described in note 33.
The balance Interest on leasing refers to the interest cost related to the leasing liabilities recognised under IFRS 16, as
referred in accounting policy described 1 H.
Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Dividends from financial assets held for trading
\u2014
6
Dividends from financial assets through other comprehensive income
10,086
932
10,086
938
The balances Dividends from financial assets through other comprehensive income include in 2022 dividends from
shares of Octal Group Lda in the amount of Euros 7,950,000 and of Tiicc, Sarl in the amount of Euros 1,325,000. This
balance also includes income from investment fund units received during the year.
Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Fees and commissions received
Banking services provided
484,454
447,002
Management and maintenance of accounts
170,372
149,847
Bancassurance
121,824
119,395
Securities operations
70,775
67,192
Guarantees granted
46,834
44,171
Commitments to third parties
5,195
5,307
Management and intervention commissions
23,624
22,779
Fiduciary and trust activities
31
\u2014
Other commissions
20,665
19,571
943,774
875,264
Fees and commissions paid
Banking services provided by third parties
(132,751)
(114,476)
Securities operations
(8,991)
(8,514)
Guarantees received
(7,699)
(1,954)
Other commissions
(22,425)
(22,597)
(171,866)
(147,541)
771,908
727,723
Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
Other operating income / (losses)
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
adjustments due to derivatives and intra group liabilities and on a risk factor adjustment that depends on the risk
profile of the institution.
In accordance with Article 67(4) of SRM Regulation and in accordance with the Intergovernmental Agreement on the
transfer and mutualisation of contributions to the SRF, the ex-ante contributions are collected by national resolution
authorities and transferred to the SRF by 30 June of each year.
The Group delivered in 2022 the amount of Euros 25,847,000 to the Single Resolution Fund (2021: Euros 20,886,000).
The total value of the contribution attributable to the Group amounted to Euros 30,400,000 (2021: Euros 24,563,000)
and the Group opted to constitute an irrevocable commitment, through the constitution of a bailment for this purpose,
in the amount of Euros 4,553,000 (2021: Euros 3,677,000), not having this component been recognised as a cost, as
defined by the Single Resolution Council in accordance with the methodology set out in Delegated Regulation (EU) No
2015/63 of the Commission of 21 October 2014 and with the conditions laid down in the Implementing Regulation (EU)
2015/81 of the Council of 19 December 2014. As at 31 December 2022, the total amount of irrevocable commitments
constituted is Euros 25,506,000 (31 December 2021: Euros 20,953,000), registered in Other assets - Deposit account
applications (note 32).
The balance Institutional protection scheme (Poland), corresponds to the contribution of Bank Millennium to the
recently created polish Institutional Protection Scheme.
The Management Board of the Bank Millennium S.A. received information on 7 June 2022, that the Management Boards
and Supervisory Boards of Alior Bank S.A., Bank Millennium S.A. Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska
S.A., ING Bank \u015al\u0105ski S.A., mBank S.A., Powszechna Kasa Oszcz\u0119dno\u015bci Bank Polski S.A., Santander Bank Polska S.A.
(Member Banks) had passed resolutions on consenting to submitting an application to the Polish Financial Supervision
Authority for approval and recognition of the protection scheme, the members of which are banks operating in the form
of a joint-stock company together with the draft agreement on the protection scheme, i.e. Member Bank\u2019s
participation in the creation of the protection scheme referred to in Article 4 no.1(9a) of the Banking Law Act of 29
August 1997.
The objective of the protection scheme is to:
1. ensure liquidity and solvency of the Member Banks on the terms and conditions and to the extent set out in the
agreement on the protection scheme; and
2. support: a) the resolution procedure pursued by the Bank Guarantee Fund (BGF) for the bank being a joint-stock
company; and b) acquisition of the bank being a joint-stock company under Article 146b.1 of the Banking Law.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceIncomeExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-633": { "value": "
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Interest and similar income
Interest on deposits at Central Banks and on loans and advances to credit
institutions repayable on demand
55,281
(5,911)
Interest on financial assets at amortised cost
Loans and advances to credit institutions
74,519
27,399
Loans and advances to customers
2,150,214
1,411,595
Debt securities
242,165
131,080
Interest on financial assets at fair value through profit or loss
Financial assets held for trading
2,543
1,482
Financial assets not held for trading mandatorily at fair value through profit or loss
6,109
12,181
Interest on financial assets at fair value through other comprehensive income
152,066
74,020
Interest on hedging derivatives
47,212
53,023
Interest on other assets
7,126
4,255
2,737,235
1,709,124
Interest expense and similar charges
Interest on financial liabilities at amortised cost
Resources from credit institutions
18,156
74,549
Resources from customers
(421,674)
(89,781)
Non subordinated debt securities issued
(27,703)
(19,929)
Subordinated debt
(68,546)
(57,663)
Interest on financial liabilities at fair value through profit or loss
Financial liabilities held for trading
Derivatives associated to financial instruments at fair value through profit or loss
(14,130)
163
Financial liabilities at fair value through profit or loss
Resources from customers
\u2014
(1,542)
Non subordinated debt securities issued
(3,565)
(1,228)
Interest on hedging derivatives
(62,159)
(17,321)
Interest on leasing
(5,633)
(5,500)
Interest on other liabilities
(2,209)
(2,271)
(587,463)
(120,523)
2,149,772
1,588,601
The analysis of recovered loans and interest occurred during 2022 and 2021, by sector of activity, is as follows:
(Thousands of euros)
2022
2021
Agriculture and forestry
6
159
Mining
\u2014
97
Food, beverage and tobacco
34
95
Textiles
41
245
Wood and cork
43
26
Paper, printing and publishing
\u2014
2
Chemicals
105
673
Machinery, equipment and basic metallurgical
165
1,216
Electricity and gas
\u2014
12
Water
\u2014
9
Construction
2,719
1,591
Retail business
757
1,016
Wholesale business
113
811
Restaurants and hotels
67
121
Transports
56
137
Post offices
1
2
Telecommunications
2
5
Services
Financial intermediation
619
143
Real estate activities
483
146
Consulting, scientific and technical activities
8
37
Administrative and support services activities
29
931
Education
5
2
Health and collective service activities
1
1
Artistic, sports and recreational activities
3
6
Other services
8
75
Consumer loans
13,967
13,185
Mortgage credit
130
832
Other domestic activities
29
1,198
Other international activities
1,446
165
20,837
22,938
The analysis of recovered loans and interest occurred during 2022 and 2021, by type of credit, is as follows:
(Thousands of euros)
2022
2021
Asset-backed loans
130
818
Other guaranteed loans
4,237
1,547
Unsecured loans
16,301
18,089
Foreign loans
80
1,210
Factoring operations
\u2014
22
Finance leases
89
1,252
20,837
22,938
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-635": { "value": "Dividends from equity instruments
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Dividends from financial assets held for trading
\u2014
6
Dividends from financial assets through other comprehensive income
10,086
932
10,086
938
The balances Dividends from financial assets through other comprehensive income include in 2022 dividends from
shares of Octal Group Lda in the amount of Euros 7,950,000 and of Tiicc, Sarl in the amount of Euros 1,325,000. This
balance also includes income from investment fund units received during the year.
", "dimensions": { "concept": "ifrs-full:DisclosureOfDividendsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-636": { "value": "Net fees and commissions income
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Fees and commissions received
Banking services provided
484,454
447,002
Management and maintenance of accounts
170,372
149,847
Bancassurance
121,824
119,395
Securities operations
70,775
67,192
Guarantees granted
46,834
44,171
Commitments to third parties
5,195
5,307
Management and intervention commissions
23,624
22,779
Fiduciary and trust activities
31
\u2014
Other commissions
20,665
19,571
943,774
875,264
Fees and commissions paid
Banking services provided by third parties
(132,751)
(114,476)
Securities operations
(8,991)
(8,514)
Guarantees received
(7,699)
(1,954)
Other commissions
(22,425)
(22,597)
(171,866)
(147,541)
771,908
727,723
", "dimensions": { "concept": "ifrs-full:DisclosureOfFeeAndCommissionIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-637": { "value": "Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
Other operating income / (losses)
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
adjustments due to derivatives and intra group liabilities and on a risk factor adjustment that depends on the risk
profile of the institution.
In accordance with Article 67(4) of SRM Regulation and in accordance with the Intergovernmental Agreement on the
transfer and mutualisation of contributions to the SRF, the ex-ante contributions are collected by national resolution
authorities and transferred to the SRF by 30 June of each year.
The Group delivered in 2022 the amount of Euros 25,847,000 to the Single Resolution Fund (2021: Euros 20,886,000).
The total value of the contribution attributable to the Group amounted to Euros 30,400,000 (2021: Euros 24,563,000)
and the Group opted to constitute an irrevocable commitment, through the constitution of a bailment for this purpose,
in the amount of Euros 4,553,000 (2021: Euros 3,677,000), not having this component been recognised as a cost, as
defined by the Single Resolution Council in accordance with the methodology set out in Delegated Regulation (EU) No
2015/63 of the Commission of 21 October 2014 and with the conditions laid down in the Implementing Regulation (EU)
2015/81 of the Council of 19 December 2014. As at 31 December 2022, the total amount of irrevocable commitments
constituted is Euros 25,506,000 (31 December 2021: Euros 20,953,000), registered in Other assets - Deposit account
applications (note 32).
The balance Institutional protection scheme (Poland), corresponds to the contribution of Bank Millennium to the
recently created polish Institutional Protection Scheme.
The Management Board of the Bank Millennium S.A. received information on 7 June 2022, that the Management Boards
and Supervisory Boards of Alior Bank S.A., Bank Millennium S.A. Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska
S.A., ING Bank \u015al\u0105ski S.A., mBank S.A., Powszechna Kasa Oszcz\u0119dno\u015bci Bank Polski S.A., Santander Bank Polska S.A.
(Member Banks) had passed resolutions on consenting to submitting an application to the Polish Financial Supervision
Authority for approval and recognition of the protection scheme, the members of which are banks operating in the form
of a joint-stock company together with the draft agreement on the protection scheme, i.e. Member Bank\u2019s
participation in the creation of the protection scheme referred to in Article 4 no.1(9a) of the Banking Law Act of 29
August 1997.
The objective of the protection scheme is to:
1. ensure liquidity and solvency of the Member Banks on the terms and conditions and to the extent set out in the
agreement on the protection scheme; and
2. support: a) the resolution procedure pursued by the Bank Guarantee Fund (BGF) for the bank being a joint-stock
company; and b) acquisition of the bank being a joint-stock company under Article 146b.1 of the Banking Law.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinanceCostExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-638": { "value": "Gains / (losses) on financial operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balance Gains/(losses) arising from derecognition of financial assets at fair value through other comprehensive
income Gains - Debt securities portfolio includes the amount of Euros 479,000 (2021: Euros 38,895,000) related to gains
resulting from the sale of Portuguese Treasury bonds.
The balance Gains/(losses) on hedge accounting includes a net gain of Euros 114,278,000 (2021: Euros 4,748,000)
regarding the sale of financial assets at fair value through other comprehensive income subject to hedge accounting,
which are offset in the balance Gains/(losses) arising from derecognition of financial assets at fair value through other
comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradingIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-639": { "value": "
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial operations at fair value through profit or loss
Gains/(losses) on financial assets held for trading
(151,915)
198,287
Gains/(losses) on financial assets not held for trading mandatorily
at fair value through profit or loss
8,962
(6,478)
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
170,259
(192,056)
27,306
(247)
Foreign exchange gains/(losses)
19,390
17,494
Hedge accounting gains/(losses)
(2,233)
4,286
Gains/(losses) arising from derecognition of financial assets and liabilities at amortised cost
18,883
(3,717)
Gains/(losses) arising from derecognition of financial assets at fair value
through other comprehensive income
(13,386)
68,722
49,960
86,538
The balances Gains/(losses) on financial operations at fair value through profit or loss is comprised of:
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets held for trading
Gains
Debt securities portfolio
7,122
14,990
Equity instruments
202
2
Derivative financial instruments
336,772
320,154
Other operations
1,962
1,498
346,058
336,644
Losses
Debt securities portfolio
(16,543)
(14,604)
Equity instruments
(8,062)
(628)
Derivative financial instruments
(472,534)
(122,133)
Other operations
(834)
(992)
(497,973)
(138,357)
(151,915)
198,287
Gains/(losses) on financial assets not held for trading
mandatorily at fair value through profit or loss
Gains
Loans and advances to customers
10,280
37,639
Debt securities portfolio
46,352
20,269
Equity instruments
14,658
1,642
71,290
59,550
Losses
Loans and advances to customers
(7,610)
(28,897)
Debt securities portfolio
(54,718)
(37,131)
(62,328)
(66,028)
8,962
(6,478)
(continues)
(continuation)
(Thousands of euros)
2022
2021
Gains/(losses) on financial assets and liabilities designated at fair value
through profit or loss
Gains
Resources from customers
3,936
176
Debt securities issued
Certificates and structured securities issued
142,982
\u2014
Other debt securities issued
25,993
3,697
172,911
3,873
Losses
Debt securities issued
Certificates and structured securities issued
\u2014
(193,488)
Other debt securities issued
(2,652)
(2,441)
(2,652)
(195,929)
170,259
(192,056)
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2022
2021
Financial assets at fair value through profit or loss
Financial assets held for trading
Debt instruments
338,813
452,105
Equity instruments
51,540
48,879
Trading derivatives
376,244
430,501
766,597
931,485
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
20,929
79,189
Debt instruments
504,200
881,556
Equity instruments
27,550
30,193
552,679
990,938
Financial assets at fair value through other comprehensive income
Debt instruments
7,434,152
12,856,165
Equity instruments
27,401
34,823
7,461,553
12,890,988
8,780,829
14,813,411
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2022, is analysed as follows:
(Thousands of euros)
2022
At fair value through profit or loss
Held for trading
Not held for trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
21,450
\u2014
2,448,636
2,470,086
Foreign issuers
8,353
\u2014
2,916,098
2,924,451
Bonds issued by other entities
Portuguese issuers
\u2014
51
542,765
542,816
Foreign issuers
74
\u2014
897,146
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
308,936
\u2014
993
309,929
Foreign issuers
\u2014
\u2014
628,514
628,514
Shares of foreign companies (a)
\u2014
19,387
\u2014
19,387
Investment fund units (b)
\u2014
484,762
\u2014
484,762
338,813
504,200
7,434,152
8,277,165
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
18,811
18,811
Foreign companies
24
27,550
8,590
36,164
Other securities
51,516
\u2014
\u2014
51,516
51,540
27,550
27,401
106,491
Trading derivatives
376,244
\u2014
\u2014
376,244
766,597
531,750
7,461,553
8,759,900
Level 1
389,954
\u2014
6,489,282
6,879,236
Level 2
81,347
\u2014
322,514
403,861
Level 3
295,296
531,750
649,757
1,476,803
(a)Under IFRS 9 these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9 these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
At fair value through profit or loss
Held for trading
Not held for
trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
10,317
\u2014
3,798,776
3,809,093
Foreign issuers
18,857
\u2014
6,736,241
6,755,098
Bonds issued by other entities
Portuguese issuers
1,716
16,734
742,554
761,004
Foreign issuers
1,073
\u2014
1,011,740
1,012,813
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
420,142
\u2014
6,027
426,169
Foreign issuers
\u2014
\u2014
560,827
560,827
Shares of foreign companies (a)
\u2014
35,185
\u2014
35,185
Investment fund units (b)
\u2014
829,637
\u2014
829,637
452,105
881,556
12,856,165
14,189,826
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
17,275
17,275
Foreign companies
32
30,193
17,548
47,773
Other securities
48,847
\u2014
\u2014
48,847
48,879
30,193
34,823
113,895
Trading derivatives
430,501
\u2014
\u2014
430,501
931,485
911,749
12,890,988
14,734,222
Level 1
499,147
\u2014
12,463,415
12,962,562
Level 2
169,181
\u2014
303,629
472,810
Level 3
263,157
911,749
123,944
1,298,850
(a)Under IFRS 9, these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9, these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31 December 2022, by
valuation levels, is analysed as follows:
(Thousands of euros)
2022
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,336,787
133,299
\u2014
2,470,086
Foreign issuers
2,908,924
\u2014
15,527
2,924,451
Bonds issued by other entities
Portuguese issuers
416,374
57,212
69,230
542,816
Foreign issuers
853,605
43,615
\u2014
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
309,929
\u2014
\u2014
309,929
Foreign issuers
\u2014
88,462
540,052
628,514
Shares of Foreign companies (**)
\u2014
\u2014
19,387
19,387
Investment fund units
\u2014
\u2014
484,762
484,762
6,825,619
322,588
1,128,958
8,277,165
Equity instruments
Shares
Portuguese companies
2,402
\u2014
16,409
18,811
Foreign companies
24
\u2014
36,140
36,164
Other securities
51,191
\u2014
325
51,516
53,617
\u2014
52,874
106,491
Trading derivatives
\u2014
81,273
294,971
376,244
6,879,236
403,861
1,476,803
8,759,900
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at 31
December 2021, is as follows:
(Thousands of euros)
2021
Up to 3
months
3 months to 1
year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
32,301
1,370,717
2,406,075
\u2014
3,809,093
Foreign issuers
\u2014
1,067,698
4,285,163
1,402,237
\u2014
6,755,098
Bonds issued by other entities
Portuguese issuers
40,017
203
588,298
132,486
\u2014
761,004
Foreign issuers
\u2014
\u2014
389,622
623,191
\u2014
1,012,813
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
270,511
155,658
\u2014
\u2014
\u2014
426,169
Foreign issuers
20,411
540,416
\u2014
\u2014
\u2014
560,827
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
35,185
35,185
Investment fund units
\u2014
\u2014
284,865
539,067
5,705
829,637
330,939
1,796,276
6,918,665
5,103,056
40,890
14,189,826
Equity instruments
Shares
Portuguese companies
17,275
17,275
Foreign companies
47,773
47,773
Other securities
48,847
48,847
\u2014
\u2014
\u2014
\u2014
113,895
113,895
330,939
1,796,276
6,918,665
5,103,056
154,785
14,303,721
The balance Financial assets not held for trading mandatorily at fair value through profit or loss - Loans to customers at
fair value is analysed as follows:
(Thousands of euros)
2022
2021
Unsecured loans
17,217
74,248
Overdue loans - less than 90 days
554
1,626
Overdue loans - Over 90 days
3,158
3,315
20,929
79,189
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2022, is as follows:
(Thousands of euros)
2022
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
5
\u2014
5
Paper, printing and publishing
45,562
2
\u2014
45,564
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
6
\u2014
6
Electricity and gas
2,302
\u2014
\u2014
2,302
Water
44,627
\u2014
\u2014
44,627
Construction
9,460
2
20,159
29,621
Retail business
4,934
2
\u2014
4,936
Wholesale business
20,503
260
\u2014
20,763
Restaurants and hotels
6,456
1,401
\u2014
7,857
Transports
29,491
\u2014
\u2014
29,491
Telecommunications
38,869
4,401
\u2014
43,270
Services
\u00a0 Financial intermediation (*)
1,533,154
54,477
512,408
2,100,039
\u00a0 Consulting, scientific and technical activities
303,036
103
\u2014
303,139
\u00a0 Administrative and support services activities
26,691
8,629
\u2014
35,320
\u00a0 Public sector
\u2014
\u2014
325
325
\u00a0 Other services
3,465
5,054
3,386
11,905
Other international activities
\u2014
18
\u2014
18
2,068,550
74,362
536,278
2,679,190
Government and Public securities
5,704,466
\u2014
\u2014
5,704,466
7,773,016
74,362
536,278
8,383,656
(*) The balance Other financial assets includes restructuring funds in the amount of Euros 410,571,000, which are classified in the
sector of activity Services - Financial intermediation but the core segment is disclosed in note 47.
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2021, is as follows:
(Thousands of euros)
2021
Bonds and Treasury
bills
Shares
Other Financial
Assets
Total
Fisheries
1,513
\u2014
\u2014
1,513
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
47,865
1
\u2014
47,866
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
7
\u2014
7
Electricity and gas
43,805
\u2014
\u2014
43,805
Water
10,241
\u2014
\u2014
10,241
Construction
21,155
2
20,423
41,580
Retail business
42,322
3
\u2014
42,325
Wholesale business
39,161
8,087
\u2014
47,248
Restaurants and hotels
\u2014
1,330
\u2014
1,330
Transports
77,463
\u2014
\u2014
77,463
Telecommunications
42,854
4,285
\u2014
47,139
Services
Financial intermediation (*)
1,016,537
72,308
839,714
1,928,559
Real estate activities
\u2014
\u2014
13,588
13,588
Consulting, scientific and technical activities
455,409
103
\u2014
455,512
Administrative and support services activities
12,220
7,981
\u2014
20,201
Public sector
\u2014
\u2014
136
136
Artistic, sports and recreational activities
16,683
\u2014
\u2014
16,683
Other services
4,893
6,118
4,623
15,634
1,832,121
100,233
878,484
2,810,838
Government and Public securities
11,492,883
\u2014
\u2014
11,492,883
13,325,004
100,233
878,484
14,303,721
Hedging derivatives
This balance is analysed, by hedging instruments, as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Assets
Liabilities
Swaps
59,703
178,000
109,059
377,206
As at 31 December 2022, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2022
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
11,962,045
27,696
7,031
309,506
Foreign exchange risk
Currency and interest rate swap
431,257
2,999
18,432
(717)
12,393,302
30,695
25,463
308,789
Cash flows hedging
Interest rate risk
Interest rate swaps
14,559,138
\u2014
110,562
(1,513,397)
Foreign exchange risk
Currency and interest rate swap
1,273,663
29,008
41,975
(10,527)
15,832,801
29,008
152,537
(1,523,924)
Total
28,226,103
59,703
178,000
(1,215,135)
(A)Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31 December 2021, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2021
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
15,464,986
74,261
28,509
127,033
Foreign exchange risk
Currency and interest rate swap
347,329
12,043
121
(29)
15,812,315
86,304
28,630
127,004
Cash flows hedging
Interest rate risk
Interest rate swaps
15,781,769
19,617
283,335
(324,922)
Foreign exchange risk
Currency and interest rate swap
1,691,525
3,138
65,008
(1,241)
17,473,294
22,755
348,343
(326,163)
Hedging of net investments in foreign entities
Foreign exchange risk
Currency and interest rate swap
153,427
\u2014
233
(1,045)
Total
33,439,036
109,059
377,206
(200,204)
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
As at 31 December 2021, the table below includes the detail of the hedged items:
(Thousands of euros)
2021
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change
in fair
value (A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
745,328
\u2014
(1,678)
\u2014
(8,237)
n/a
n/a
(H)
4,133,227
\u2014
(12,706)
\u2014
(20,638)
n/a
n/a
(C)
6,574,692
\u2014
41,485
(2,013)
(117,932)
n/a
n/a
(D)
\u2014
10,000
\u2014
93
140
n/a
n/a
(E)
\u2014
12,350
\u2014
490
311
n/a
n/a
(F)
\u2014
497,998
\u2014
(985)
979
n/a
n/a
(G)
\u2014
758,076
\u2014
(4,530)
5,754
n/a
n/a
Foreign exchange risk
Currency and interest rate
swap
\u2014
347,329
\u2014
(66)
98
n/a
n/a
11,453,247
1,625,753
27,101
(7,011)
(139,525)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
15,781,551
\u2014
\u2014
\u2014
324,922
(263,143)
131,353
Foreign exchange risk
Currency and interest rate
swap
(B)
1,691,525
\u2014
\u2014
\u2014
1,939
(9,567)
(285)
17,473,076
\u2014
\u2014
\u2014
326,861
(272,710)
131,068
Hedging of net investments
in foreign entities
Foreign exchange risk
- Bank Millennium, S.A.
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
Total
28,926,323
1,625,753
27,101
(7,011)
188,381
(217,384)
131,068
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
The reconciliation of each equity component and an analysis of other comprehensive income attributable to hedge
accounting, with reference to 31 December 2022 and 2021, is as follows:
(Thousands of euros)
Cash flow hedge reserve
Exchange differences
2022
2021
2022
2021
Balance as at 1 January
(141,642)
262,288
55,326
56,371
Amounts recognised in other comprehensive income:
\u00a0 Hedging cash flows
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,523,207)
(326,958)
\u2014
\u2014
\u00a0 \u00a0 Foreign exchange changes
1,725
42
\u2014
\u2014
\u00a0 \u00a0 Hedge breakage
(123,938)
(75,565)
\u2014
\u2014
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
1,333
107
\u2014
\u2014
\u00a0 \u00a0 Others
(2,279)
(1,556)
\u2014
\u2014
\u00a0 Hedging of net investments - foreign exchange risk
\u00a0 \u00a0 Reclassified to the income statement
\u2014
\u2014
3,685
(1,045)
Change in the fair value of settled transactions
\u2014
\u2014
(59,011)
\u2014
Balance at the end of the year
(1,788,008)
(141,642)
\u2014
55,326
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2022:
(Thousands of euros)
2022
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiven
ess
recognised
in Income
statement
(A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(17,717)
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
362
\u2014
\u2014
\u2014
(17,355)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(66,333)
(238)
(E)
54,861
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(15,838)
(1,333)
\u2014
\u2014
(82,171)
(1,571)
54,861
\u2014
Total
(82,171)
(18,926)
54,861
\u2014
(A)Income Statement item in which the ineffectiveness of the hedge was recognised
(B)Income Statement item in which the reclassified amount was recognised
(C)but which are no longer expected to occur
(D)Net gains/(losses) from hedge accounting operations
(E)Interest income
(F)Net gains/(losses) from foreign exchange
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2021:
(Thousands of euros)
2021
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(12,590)
\u2014
\u2014
Interest rate futures
(D)
\u2014
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
69
\u2014
\u2014
\u2014
(12,521)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(72,809)
(699)
(E)
68,038
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(6,156)
(107)
\u2014
\u2014
(78,965)
(806)
68,038
\u2014
Hedging of net investments in
foreign entities
Foreign exchange risk
(F)
Currency and interest rate swap
(1,045)
\u2014
\u2014
\u2014
Total
(80,010)
(13,327)
68,038
\u2014
The table below shows the detail of hedging instruments, as at 31 December 2021, by maturity:
(Thousands of euros)
2021
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months to 1
year
Over 1
year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
342,503
1,076,631
14,045,852
15,464,986
74,261
28,509
Fixed interest rate (average)
1.54%
0.57%
0.25%
0.30%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
171,466
175,863
\u2014
347,329
12,043
121
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
\u2014
174,524
15,607,245
15,781,769
19,617
283,335
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
210,017
160,365
1,321,143
1,691,525
3,138
65,008
Hedging derivatives related to
net investment in foreign operations:
OTC Market:
Currency and interest rate swap
153,427
\u2014
\u2014
153,427
\u2014
233
Total derivatives traded by
OTC Market:
877,413
1,587,383
30,974,240
33,439,036
109,059
377,206
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-642": { "value": "Other operating income / (losses)
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
adjustments due to derivatives and intra group liabilities and on a risk factor adjustment that depends on the risk
profile of the institution.
In accordance with Article 67(4) of SRM Regulation and in accordance with the Intergovernmental Agreement on the
transfer and mutualisation of contributions to the SRF, the ex-ante contributions are collected by national resolution
authorities and transferred to the SRF by 30 June of each year.
The Group delivered in 2022 the amount of Euros 25,847,000 to the Single Resolution Fund (2021: Euros 20,886,000).
The total value of the contribution attributable to the Group amounted to Euros 30,400,000 (2021: Euros 24,563,000)
and the Group opted to constitute an irrevocable commitment, through the constitution of a bailment for this purpose,
in the amount of Euros 4,553,000 (2021: Euros 3,677,000), not having this component been recognised as a cost, as
defined by the Single Resolution Council in accordance with the methodology set out in Delegated Regulation (EU) No
2015/63 of the Commission of 21 October 2014 and with the conditions laid down in the Implementing Regulation (EU)
2015/81 of the Council of 19 December 2014. As at 31 December 2022, the total amount of irrevocable commitments
constituted is Euros 25,506,000 (31 December 2021: Euros 20,953,000), registered in Other assets - Deposit account
applications (note 32).
The balance Institutional protection scheme (Poland), corresponds to the contribution of Bank Millennium to the
recently created polish Institutional Protection Scheme.
The Management Board of the Bank Millennium S.A. received information on 7 June 2022, that the Management Boards
and Supervisory Boards of Alior Bank S.A., Bank Millennium S.A. Bank Polska Kasa Opieki S.A., BNP Paribas Bank Polska
S.A., ING Bank \u015al\u0105ski S.A., mBank S.A., Powszechna Kasa Oszcz\u0119dno\u015bci Bank Polski S.A., Santander Bank Polska S.A.
(Member Banks) had passed resolutions on consenting to submitting an application to the Polish Financial Supervision
Authority for approval and recognition of the protection scheme, the members of which are banks operating in the form
of a joint-stock company together with the draft agreement on the protection scheme, i.e. Member Bank\u2019s
participation in the creation of the protection scheme referred to in Article 4 no.1(9a) of the Banking Law Act of 29
August 1997.
The objective of the protection scheme is to:
1. ensure liquidity and solvency of the Member Banks on the terms and conditions and to the extent set out in the
agreement on the protection scheme; and
2. support: a) the resolution procedure pursued by the Bank Guarantee Fund (BGF) for the bank being a joint-stock
company; and b) acquisition of the bank being a joint-stock company under Article 146b.1 of the Banking Law.
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherOperatingIncomeExpenseExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-643": { "value": "
The amount of this account is comprised of
(Thousands of euros)
2022
2021
Operating income
Gains on leasing operations
3,266
5,764
Income from services provided
28,614
29,290
Rents
4,053
3,679
Sales of cheques and others
9,730
9,838
Other operating income
50,125
61,831
95,788
110,402
Operating costs
Donations and contributions
(4,435)
(4,576)
Contribution to the banking sector
(43,484)
(39,286)
Contributions to Resolution Funds
(36,489)
(27,615)
Contribution to the Single Resolution Fund
(25,847)
(20,886)
Contributions to the Deposit Guarantee Fund
(8,805)
(15,398)
Institutional protection scheme (Poland)
(58,972)
\u2014
Special tax on the Polish banking sector
(36,107)
(68,520)
Taxes
(18,137)
(15,585)
Losses on financial leasing operations
(37)
(84)
Other operating costs
(56,587)
(47,357)
(288,900)
(239,307)
(193,112)
(128,905)
The balance Remunerations includes in 2022 the amount of Euros 5,630,000 related to the distribution of profits to
Bank's employees. In 2021, there was no distribution of profits to Bank's employees.
In November 2022, the Bank decided to award an extraordinary payment of Euros 500 to all employees without an
assigned vehicle, which amounted to Euros 2,869,000 reflected in the balance Remunerations. This measure aimed to
contribute to the mitigation of the impact of the current inflationary conjuncture on employees' income.
In 2022, the Bank accounted for in Other costs the amount of Euros 4,414,000 (2021: Euros 84,152,000), referring to
agreements already concluded with some employees whose effective departures will occur during the first half of 2023
(note 39).
This balance also included severance payments in the amount of 1,588,000 (2021: Euros 4,219,000), of which the
highest amounted to Euros 217,000 (2021: Euros 886,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by category:
2022
2021
Portugal
Top Management
854
882
Intermediary Management
1,416
1,508
Specific/Technical functions
2,867
2,976
Other functions
1,119
1,398
6,256
6,764
Abroad
9,314
9,809
15,570
16,573
Remunerations
In compliance with the provisions of Article 47 of Banco de Portugal Notice no. 3/2020, quantitative information is
disclosed regarding the remuneration paid to different categories of members of governing bodies and categories of
employees provided for in Article 115 C no. 2 of the RGICS, as well as the information provided for in Article 450 g) to i)
of Regulation (EU) 2019/876 of the European Parliament and of the Council.
A. BCP Board of Directors
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial Portugu\u00eas,
S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2022
2021
2022
2021
Fixed remuneration
3,055
3,055
1,856
1,915
Variable remuneration
Pecuniary
370
246
\u2014
\u2014
Shares
1,322
172
\u2014
\u2014
Deferred
1,024
138
\u2014
\u2014
Supplementary retirement pension
611
611
138
138
Post-employment benefits
(42)
(1)
\u2014
\u2014
Other mandatory social security charges
734
733
443
457
7,074
4,954
2,437
2,510
Number of beneficiaries
6
6
11
11
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity contract,
intends to compensate the functions that are performed in the Bank and in all other functions performed in subsidiaries
or governing bodies for which they have been designated by indication or in representation of the Bank, in the latter
case, the net amount of the remuneration annually received by each member of the Executive Committee will be
deducted from the fixed annual remuneration attributed by the Bank, ensuring that the effective payable amount
corresponds to the one approved by the Remuneration and Welfare Board.
In 2022, the amount of remuneration paid to the Executive Committee includes the amount of Euros 101,000 (2021:
Euros 108,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was Euros 26,000 (2021: Euros 33,000).
In 2022, it was assigned variable remuneration in accordance with the remuneration policies for the members of the
management and supervisory bodies and for employees, approved for 2021, as described in accounting policies 1 R4 and
1 R5.
In 2022, the variable remuneration attributed was Euros 616,000 in cash, of which Euros 246,000 are deferred for 5
years, and 12,416,223 shares corresponding to Euros 2,567,000, of which 1,568,846 shares are deferred for 5 years, and
3,397,643 shares are deferred for 3 years.
In 2021, the deferred variable remuneration attributed to the Executive Committee related to 2020, was Euros 164,000
in cash and 807,882 BCP shares.
In 2022 the deferred variable remuneration from 2021, 2020 and 2019 attributed to the Executive Committee is related
to 2020, 2019 and 2018 years respectively, and amounts to Euros 590,000 in cash and 2,443,549 BCP shares in the
amount of Euros 434,000.
In 2021, the 2019 deferred variable remuneration paid to the Executive Committee relates to the 2018 financial year
and it includes the amount of Euros 89,000 and 347,432 BCP shares in the amount of Euros 49,000.
During 2022 and 2021, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
In 2022, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2022
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,317
2,657
453
2,474
5,041
11,942
Variable remuneration
Pecuniary
129
176
43
224
448
1,020
Shares
80
105
19
139
261
604
Deferred
48
42
9
20
120
239
Post-employment benefits
(112)
(108)
(7)
(191)
(366)
(784)
Other mandatory social security
charges
331
547
111
649
1,209
2,847
1,793
3,419
628
3,315
6,713
15,868
Number of beneficiaries
9
15
2
26
38
90
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2021, as
described in accounting policies 1 R4 and 1 R5, in 2022, the 90 Key Function Holders were awarded with variable
remuneration, in the amount of Euros 236,000 in cash and 1,534,941 shares deferred for 5 years, as well as 174
participation units from AF Fund deferred for 3 years.
In 2022, deferred variable remunerations were paid to KFH deferred from 2021, 2020 and 2019 years, corresponding in
cash to Euros 57,000 and shares in the amount of Euros 182,000.
In 2022, severance payments were paid to 3 KFH in the amount of Euros 255,000, of which the highest payment was
Euros 200,000.
In 2021, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2021
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,188
2,873
450
2,100
4,513
11,124
Variable remuneration
Pecuniary
28
46
6
57
119
256
Shares
20
27
4
29
73
153
Deferred
31
34
6
15
93
179
Post-employment benefits
(76)
(20)
13
(78)
(214)
(375)
Other mandatory social security
charges
292
741
109
530
1,116
2,788
1,483
3,701
588
2,653
5,700
14,125
Number of beneficiaries
8
16
2
22
37
85
As described in accounting policies 1.R4 and 1.R5, during 2021, the 85 Key Function Holders were awarded variable
remuneration arising from the application of the Remuneration Policies for Employees, approved for the financial year
2020, which will be deferred over a period of 5 years, in the amount of Euros 229,000.
In 2021, deferred variable remuneration was paid to KFH deferred from 2020 and 2019, corresponding in cash to Euros
42,000 and shares in the amount of Euros 137,000.
In 2021, severance payments were paid to 3 KFH in the amount of Euros 1,327,000 of which the highest amounts to
Euros 886,000.
In 2022 and 2021, the remunerations and social security charges supported with the Group's Key Function Holders,
discriminated by Key management members and by members whose professional activities have significant impact in
the risk profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management members
Other KFH
Total
2022
2021
2022
2021
2022
2021
Fixed remuneration
7,865
7,431
4,077
3,693
11,942
11,124
Variable remuneration
Pecuniary
705
170
315
86
1,020
256
Shares
417
111
187
42
604
153
Deferred
230
169
9
10
239
179
Post-employment benefits
(453)
(202)
(331)
(173)
(784)
(375)
Other mandatory social security
charges
1,934
1,840
913
948
2,847
2,788
10,698
9,519
5,170
4,606
15,868
14,125
Number of beneficiaries
53
51
37
34
90
85
The balance Rents and leases includes the amount of Euros 590,000 (2021: Euros 581,000) related to short-term lease
contracts and the amount of Euros 2,402.000 (2021: Euros 2,564,000) related to lease contracts of low-value assets, as
described in the accounting policy 1 H.
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other services,
is analysed as follows:
(Thousands of euros)
2022
2021
Auditing services
Legal certification
3,190
2,947
Other assurance services
1,388
1,269
Other services
310
594
4,888
4,810
The balance Remunerations includes in 2022 the amount of Euros 5,630,000 related to the distribution of profits to
Bank's employees. In 2021, there was no distribution of profits to Bank's employees.
In November 2022, the Bank decided to award an extraordinary payment of Euros 500 to all employees without an
assigned vehicle, which amounted to Euros 2,869,000 reflected in the balance Remunerations. This measure aimed to
contribute to the mitigation of the impact of the current inflationary conjuncture on employees' income.
In 2022, the Bank accounted for in Other costs the amount of Euros 4,414,000 (2021: Euros 84,152,000), referring to
agreements already concluded with some employees whose effective departures will occur during the first half of 2023
(note 39).
This balance also included severance payments in the amount of 1,588,000 (2021: Euros 4,219,000), of which the
highest amounted to Euros 217,000 (2021: Euros 886,000).
The average number of employees by professional category, at service in the Group, is analysed as follows by category:
2022
2021
Portugal
Top Management
854
882
Intermediary Management
1,416
1,508
Specific/Technical functions
2,867
2,976
Other functions
1,119
1,398
6,256
6,764
Abroad
9,314
9,809
15,570
16,573
", "dimensions": { "concept": "ifrs-full:DisclosureOfInformationAboutEmployeesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-647": { "value": "
The fixed remuneration and social charges paid to members of the Board of Directors of Banco Comercial Portugu\u00eas,
S.A. are analysed as follows:
(Thousands of euros)
Board of Directors
Executive Committee
Non-executive directors
2022
2021
2022
2021
Fixed remuneration
3,055
3,055
1,856
1,915
Variable remuneration
Pecuniary
370
246
\u2014
\u2014
Shares
1,322
172
\u2014
\u2014
Deferred
1,024
138
\u2014
\u2014
Supplementary retirement pension
611
611
138
138
Post-employment benefits
(42)
(1)
\u2014
\u2014
Other mandatory social security charges
734
733
443
457
7,074
4,954
2,437
2,510
Number of beneficiaries
6
6
11
11
Considering that the remuneration of members of the Executive Committee and Directors, with an exclusivity contract,
intends to compensate the functions that are performed in the Bank and in all other functions performed in subsidiaries
or governing bodies for which they have been designated by indication or in representation of the Bank, in the latter
case, the net amount of the remuneration annually received by each member of the Executive Committee will be
deducted from the fixed annual remuneration attributed by the Bank, ensuring that the effective payable amount
corresponds to the one approved by the Remuneration and Welfare Board.
In 2022, the amount of remuneration paid to the Executive Committee includes the amount of Euros 101,000 (2021:
Euros 108,000) supported by subsidiaries or companies whose governing bodies represent the Group's interests.
Regarding the Non-executive directors, this amount was Euros 26,000 (2021: Euros 33,000).
In 2022, it was assigned variable remuneration in accordance with the remuneration policies for the members of the
management and supervisory bodies and for employees, approved for 2021, as described in accounting policies 1 R4 and
1 R5.
In 2022, the variable remuneration attributed was Euros 616,000 in cash, of which Euros 246,000 are deferred for 5
years, and 12,416,223 shares corresponding to Euros 2,567,000, of which 1,568,846 shares are deferred for 5 years, and
3,397,643 shares are deferred for 3 years.
In 2021, the deferred variable remuneration attributed to the Executive Committee related to 2020, was Euros 164,000
in cash and 807,882 BCP shares.
In 2022 the deferred variable remuneration from 2021, 2020 and 2019 attributed to the Executive Committee is related
to 2020, 2019 and 2018 years respectively, and amounts to Euros 590,000 in cash and 2,443,549 BCP shares in the
amount of Euros 434,000.
In 2021, the 2019 deferred variable remuneration paid to the Executive Committee relates to the 2018 financial year
and it includes the amount of Euros 89,000 and 347,432 BCP shares in the amount of Euros 49,000.
During 2022 and 2021, no severance payments were paid to members of the Board of Directors.
B. Key Function Holders (KFH)
In 2022, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2022
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,317
2,657
453
2,474
5,041
11,942
Variable remuneration
Pecuniary
129
176
43
224
448
1,020
Shares
80
105
19
139
261
604
Deferred
48
42
9
20
120
239
Post-employment benefits
(112)
(108)
(7)
(191)
(366)
(784)
Other mandatory social security
charges
331
547
111
649
1,209
2,847
1,793
3,419
628
3,315
6,713
15,868
Number of beneficiaries
9
15
2
26
38
90
Arising from the application of the Remuneration Policies for Employees, approved for the financial year 2021, as
described in accounting policies 1 R4 and 1 R5, in 2022, the 90 Key Function Holders were awarded with variable
remuneration, in the amount of Euros 236,000 in cash and 1,534,941 shares deferred for 5 years, as well as 174
participation units from AF Fund deferred for 3 years.
In 2022, deferred variable remunerations were paid to KFH deferred from 2021, 2020 and 2019 years, corresponding in
cash to Euros 57,000 and shares in the amount of Euros 182,000.
In 2022, severance payments were paid to 3 KFH in the amount of Euros 255,000, of which the highest payment was
Euros 200,000.
In 2021, the remunerations and social security charges supported with the Group's Key Function Holders are, detailed
by segment, as follows:
(Thousands of euros)
2021
Retail
Corporate
Private
Banking
Control
functions
Others
Total
Fixed remuneration
1,188
2,873
450
2,100
4,513
11,124
Variable remuneration
Pecuniary
28
46
6
57
119
256
Shares
20
27
4
29
73
153
Deferred
31
34
6
15
93
179
Post-employment benefits
(76)
(20)
13
(78)
(214)
(375)
Other mandatory social security
charges
292
741
109
530
1,116
2,788
1,483
3,701
588
2,653
5,700
14,125
Number of beneficiaries
8
16
2
22
37
85
As described in accounting policies 1.R4 and 1.R5, during 2021, the 85 Key Function Holders were awarded variable
remuneration arising from the application of the Remuneration Policies for Employees, approved for the financial year
2020, which will be deferred over a period of 5 years, in the amount of Euros 229,000.
In 2021, deferred variable remuneration was paid to KFH deferred from 2020 and 2019, corresponding in cash to Euros
42,000 and shares in the amount of Euros 137,000.
In 2021, severance payments were paid to 3 KFH in the amount of Euros 1,327,000 of which the highest amounts to
Euros 886,000.
In 2022 and 2021, the remunerations and social security charges supported with the Group's Key Function Holders,
discriminated by Key management members and by members whose professional activities have significant impact in
the risk profile of the Bank (Other KFH), are as follows:
(Thousands of euros)
Key Function Holders
Key management members
Other KFH
Total
2022
2021
2022
2021
2022
2021
Fixed remuneration
7,865
7,431
4,077
3,693
11,942
11,124
Variable remuneration
Pecuniary
705
170
315
86
1,020
256
Shares
417
111
187
42
604
153
Deferred
230
169
9
10
239
179
Post-employment benefits
(453)
(202)
(331)
(173)
(784)
(375)
Other mandatory social security
charges
1,934
1,840
913
948
2,847
2,788
10,698
9,519
5,170
4,606
15,868
14,125
Number of beneficiaries
53
51
37
34
90
85
(*) The item Loans to Customers corresponds to mortgage loans granted prior to the respective election and to the
amount used from private credit cards which must be settled on the maturity date.
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in income items
of the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar income
Commissions income
2022
2021
2022
2021
Board of Directors
Non-executive directors
\u2014
\u2014
29
46
Executive Committee
\u2014
\u2014
10
9
Closely related people
\u2014
3
9
6
Key management members
Key management members
41
23
62
62
Closely related people
22
9
43
38
Controlled entities
17
\u2014
19
8
80
35
172
169
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in cost items of
the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar expense
Commissions' expense
2022
2021
2022
2021
Board of Directors
Non-executive directors
19
4
\u2014
1
Executive Committee
\u2014
\u2014
1
\u2014
Closely related people
9
1
\u2014
\u2014
Key management members
Key management members
6
6
4
4
Closely related people
2
1
2
1
Controlled entities
\u2014
\u2014
2
2
36
12
9
8
(*) Corresponds to the maximum authorized and unused limit of private credit cards and overdraft authorization in a
salary account under the same regime as all the Bank's other employees.
C)", "dimensions": { "concept": "ifrs-full:DisclosureOfInformationAboutKeyManagementPersonnelExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-648": { "value": "Other administrative costs
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Water, electricity and fuel
17,885
12,611
Credit cards and mortgage
8,603
8,035
Communications
24,296
21,544
Maintenance and related services
17,651
14,965
Legal expenses
4,368
4,535
Travel, hotel and representation costs
5,318
2,754
Advisory services
32,103
27,101
Training costs
1,404
1,239
Information technology services
35,277
43,631
Consumables
7,554
6,450
Outsourcing and independent labour
77,424
77,451
Advertising
24,854
24,345
Rents and leases
31,244
20,139
Insurance
4,848
4,875
Transportation
10,185
8,207
Other specialised services
28,970
27,591
Other supplies and services
20,977
18,699
352,961
324,172
The balance Rents and leases includes the amount of Euros 590,000 (2021: Euros 581,000) related to short-term lease
contracts and the amount of Euros 2,402.000 (2021: Euros 2,564,000) related to lease contracts of low-value assets, as
described in the accounting policy 1 H.
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other services,
is analysed as follows:
(Thousands of euros)
2022
2021
Auditing services
Legal certification
3,190
2,947
Other assurance services
1,388
1,269
Other services
310
594
4,888
4,810
", "dimensions": { "concept": "ifrs-full:DisclosureOfExpensesByNatureExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-650": { "value": "
The balance Other specialised services includes fees for services rendered by the Statutory Auditor of the Group,
currently in functions, and by companies in its network as part of its statutory audit functions, as well as other services,
is analysed as follows:
(Thousands of euros)
2022
2021
Auditing services
Legal certification
3,190
2,947
Other assurance services
1,388
1,269
Other services
310
594
4,888
4,810
These investments correspond to unquoted companies. According to the accounting policy described in note 1 B, these
investments are measured at the equity method.
The balance Investments in associated companies, as at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
Ownership on
equity
Goodwill
Impairment of
investments in
associated
companies
Total
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
261,446
\u2014
\u2014
261,446
Banco Millennium Atl\u00e2ntico, S.A.
65,716
54,744
(60,257)
60,203
Banque BCP, S.A.S.
44,933
\u2014
\u2014
44,933
SIBS, S.G.P.S, S.A.
47,142
\u2014
\u2014
47,142
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
7,684
\u2014
\u2014
7,684
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
33,146
7,435
\u2014
40,581
Webspectator Corporation
\u2014
18,011
(18,011)
\u2014
Others
349
\u2014
\u2014
349
460,416
80,190
(78,268)
462,338
The Group's companies included in the consolidation perimeter are presented in note 59, as well as the main indicators
of the most relevant ones.
The movements occurred in Impairment of investments in associated companies are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
78,268
52,559
Transfers from Other provisions (Banco Millennium Atl\u00e2ntico, S.A.) (note 39)
5,000
22,300
Sale Cold River's Homestead, S.A.
\u2014
(4,557)
Impairment charge for the year (note 13)
1,435
\u2014
Impairment\u00a0 write-off\u00a0 (Banco Millennium Atl\u00e2ntico, S.A.)
(16,787)
\u2014
Exchange rate differences
(1,653)
7,966
Balance at the end of the year
66,263
78,268
8,814
13,962
Goodwill associated with investment in BMA
3,419
4,373
Impairment of investments in associated companies (note 43)
1,653
(7,966)
Investment held at the end of the year
70,928
60,203
(*) Includes adjustments according to BCP GAAP.
The following table presents the financial statements of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.,
prepared in accordance with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2022
2021
Net profit for the year
74,425
69,900
Comprehensive income
(222,939)
(11,690)
Total comprehensive income attributable to Shareholders of the associated company
(148,514)
58,210
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
6,822
8,096
Attributable to Shareholders of the associated company adjusted to BCP GAAP
(141,692)
66,306
Attributable to the BCP Group
(69,429)
32,490
Balance sheet
Financial assets
8,417,704
10,263,904
Non-financial assets
459,055
429,543
Financial liabilities
(8,405,919)
(9,810,182)
Non-financial liabilities
(69,123)
(62,344)
Total equity
401,717
820,921
Attributable to non-controlling interests
10,929
11,718
Attributable to Shareholders of the associated companies
390,788
809,203
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
362,086
355,263
Attributable to Shareholders of the associated company adjusted to BCP GAAP
752,874
1,164,466
Attributable to the BCP Group
368,908
570,588
Reverse of the initial gain in 2004 allocated to the BCP Group
(309,142)
(309,142)
Attributable to the BCP Group adjusted of consolidation items
59,766
261,446
(*) VOBA corresponds to the estimated current value of the future cash flows of the contracts in force at the date of acquisition. The
value of the acquired business (VOBA) is recognised in the consolidated accounts of Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. as intangible assets and is amortised over the period of recognition of the income associated with the policies acquired.
The Group owns 49% of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., being accounted for under the equity
method, as Investments in associated companies.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A. is dedicated to the management of life insurance and pension
funds.
On 1 January 2023 Millenniumbcp Ageas made the simultaneous adoption of IFRS9 - Financial Instruments and IFRS17 -
Insurance Contracts. It opted for the possibility given to Insurance Companies to defer the application of IFRS9, since
the combined implementation with IFRS17 would minimize the distortion of results.
IFRS 17 replaces IFRS 4 - \"Insurance Contracts\" and is applicable to all entities that issue insurance contracts,
reinsurance contracts and investment contracts with discretionary participation features if they are also issuers of
insurance contracts.
In accordance with IFRS 17, at initial recognition, Millenniumbcp Ageas Grupo Segurador has identified the contracts
that are subject to similar risks and that are managed together, being aggregated in portfolios. For measurement
purposes, further divides portfolios of insurance contracts into groups of insurance contracts. A group of insurance
contracts is determined by first dividing the portfolio of insurance contracts into annual cohorts. Each annual cohort is
then further divided in the following groups: i) group of contracts that are onerous at initial recognition; ii) group of
contracts that at initial recognition have no significant possibility of becoming onerous subsequently; and iii) a group of
the remaining contracts in the portfolio.
Insurance contracts are now measured using estimates and updated assumptions that reflect the timing of cash flows
discounted and any uncertainty related to insurance contracts. Income is now recognized as it provides insurance
services (rather than when it receives premiums) provide information on the insurance contract earnings that it expects
to recognize in the future.
In the measurement of insurance contracts, Millenniumbcp Ageas Grupo Segurador has opted for two measurement
methods: i) Premium allocation approach (\"PAA\") for contracts with duration equal to or less than one year and ii)
General measurement model measurement model (\"GMM\") for the remaining contracts.
Initial application of IFRS 17 and IFRS 9 requires comparative information. Therefore, Millenniumbcp Ageas Grupo
Segurador made the transition exercise on 1 January 2022. The estimated impacts of the transition to IFRS 17 represent
a reduction in the Equity of Millenniumbcp Ageas Grupo Segurador, partially offset by the positive impact resulting from
the adoption of IFRS9.
IFRS 17 is retrospective with exemptions provided for the transition date. These exemptions are related to the
impracticability and complexity involved e.g. in calculating the liability, the current service margin (\"CSM\"), loss
component, or other comprehensive income (\"OCI option\") at transition date. When impracticable, the standard
provides for the use of the Modified Retrospective Approach or the Fair Value Approach. Millenniumbcp Ageas Grupo
Segurador, for contracts prior to 2018 adopted the fair value and for contracts after 2018 the full retrospective
approach.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., ('Millenniumbcp Ageas' or 'Group'), is owned by Ageas Insurance
International, N.V. (51%), through Ageas Portugal Holdings S.G.P.S., S.A. (51%), and by Banco Comercial Portugu\u00eas, S.A.
(49%).
The balances with associated companies included in the consolidated balance sheet items, except for the item
investments in associated companies, are as follows:
(Thousands of euros)
2022
2021
Assets
Loans and advances to credit institutions repayable on demand
8,834
2,130
Financial assets at amortised cost
Loans and advances to credit institutions
206,078
18,290
Loans and advances to customers
59,487
63,681
Financial assets at fair value through profit or loss
Financial assets held for trading
\u2014
35
Other assets
11,497
12,542
285,896
96,678
Liabilities
Financial liabilities at amortised cost
Resources from credit institutions
62,845
46,158
Resources from customers
211,193
346,254
Non subordinated debt securities issued
2,002
21,019
Financial liabilities held for trading
3,894
96,536
Other liabilities
8
51
279,942
510,018
The guarantees granted and revocable and irrevocable credit lines by the Group over associated companies are as
follows:
(Thousands of euros)
2022
2021
Guarantees granted
7,539
7,453
Revocable credit lines
9,527
335,367
Irrevocable credit lines
\u2014
600
17,066
343,420
List of subsidiary and associated companies of Banco Comercial Portugu\u00eas
Group
As at 31 December 2022, the Group's subsidiary companies included in the consolidated accounts using the full
consolidation method were as follows:
Group
Bank
Subsidiary companies
Head
office
Share
capital
Curre
ncy
Sector of activity
% economic
interests
% effective
held
% direct
held
Banco ActivoBank, S.A.
Lisbon
127,600,000
EUR
Banking
100%
100%
100%
Bank Millennium, S.A.
Warsaw
1,213,116,777
PLN
Banking
50.1%
50.1%
50.1%
Millennium Bank Hipoteczny S.A.
Warsaw
57,000,000
PLN
Banking
100%
50.1%
\u2014
BCP \u00c1frica, S.G.P.S., Lda.
Funchal
682,965,800
EUR
Holding company
100%
100%
100%
BIM - Banco Internacional de
Mo\u00e7ambique, S.A.
Maputo
4,500,000,000
MZN
Banking
66.7%
66.7%
\u2014
BCP Finance Bank, Ltd.
George
Town
246,000,000
USD
Banking
100%
100%
\u2014
BCP International B.V.
Amsterdam
18,000
EUR
Holding company
100%
100%
100%
Millennium BCP\u00a0 - Escrit\u00f3rio de
Representa\u00e7\u00f5es e Servi\u00e7os, Ltda.
S\u00e3o Paulo
70,062,159
BRL
Financial Services
100%
100%
100%
Millennium bcp Participa\u00e7\u00f5es,
S.G.P.S., Sociedade Unipessoal,
Lda.
Funchal
25,000
EUR
Holding company
100%
100%
100%
Interfundos - Sociedade Gestora
de Organismos de\u00a0 Investimento
Coletivo, S.A.
Oeiras
1,500,000
EUR
Investment fund
management
100%
100%
100%
Monumental Residence -
Sociedade Especial de
Investimento Imobili\u00e1rio de
Capital Fixo, SICAFI, S.A.
Oeiras
32,859,181
EUR
Real-estate
management
100%
100%
100%
Millennium bcp - Presta\u00e7\u00e3o de
Servi\u00e7os, A.C.E.
Lisbon
331,750
EUR
Services
98.6%
97.7%
93.2%
Millennium bcp Teleservi\u00e7os -
Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico,
S.A.
Lisbon
50,004
EUR
E-commerce
100%
100%
100%
Flitptrel Tires, S.A.
Lisbon
50,000
EUR
Real-estate
company
100%
100%
100%
Bichorro \u2013 Empreendimentos
Tur\u00edsticos\u00a0 e Imobili\u00e1rios S.A.
Oeiras
2,150,000
EUR
Real-estate
management
100%
100%
\u2014
Finalgarve \u2013 Sociedade de
Promo\u00e7\u00e3o Imobili\u00e1ria\u00a0 Tur\u00edstica,
S.A.
Oeiras
250,000
EUR
Real-estate
management
100%
100%
\u2014
Fiparso \u2013 Sociedade Imobili\u00e1ria
S.A
Oeiras
50,000
EUR
Real-estate
company
100%
100%
\u2014
Millennium Consulting S.A.
Warsaw
4,339,500
PLN
Consulting services
100%
50.1%
\u2014
Millennium Goodie Sp.z.o.o.
Warsaw
500,000
PLN
Web portals
100%
50.1%
\u2014
Millennium Leasing, Sp.z o.o.
Warsaw
48,195,000
PLN
Leasing
100%
50.1%
\u2014
Millennium Service, Sp.z o.o.
Warsaw
1,000,000
PLN
Services
100%
50.1%
\u2014
Millennium Financial Services,
Sp.z o.o.
Warsaw
100,000
PLN
Services
100%
50.1%
\u2014
Piast Expert Sp. z o.o (em
liquida\u00e7\u00e3o)
Tychy
100,000
PLN
Marketing services
100%
50.1%
\u2014
Millennium Telecommunication
Services Sp. z o.o.
Warsaw
100,000
PLN
Brokerage services
100%
50.1%
\u2014
Millennium TFI - Towarzystwo
Funduszy Inwestycyjnych, S.A.
Warsaw
10,300,000
PLN
Investment fund
management
100%
50.1%
\u2014
(*) - Company classified as non-current assets held for sale.
During 2022, the Group proceeded with the liquidation of \"Millennium Fundo de Capitaliza\u00e7\u00e3o - Fundo de Capital de
Risco\".
The Group holds a securitization transaction regarding mortgage loans which was set through specifically created SPE.
As referred in accounting policy 1 B, when the substance of the relationships with the SPEs indicates that the Group
holds control of its activities, the SPE is fully consolidated, following the application of IFRS 10.
As at 31 December 2022, the Special Purpose Entity included in the consolidated accounts under the full consolidation
method is as follows:
Group
Bank
Special Purpose Entities
Head
office
Share
capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Magellan Mortgages No.3 Limited
Dublin
40,000
EUR
Special Purpose
Entities
82.4%
82.4%
82.4%
As at 31 December 2022, the Group's associated companies included in the consolidated accounts under the equity
method are as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Banco Millennium Atl\u00e2ntico, S.A.
Luanda
53,821,603,000
AOA
Banking
22.7%
22.5%
\u2014
Banque BCP, S.A.S.
Paris
198,295,587
EUR
Banking
19.0%
19.0%
19.0%
Lubuskie Fabryki Mebli, S.A. (em
liquida\u00e7\u00e3o)
Swiebodzin
13,400,050
PLN
Furniture
manufacturer
50%
25.1%
\u2014
SIBS, S.G.P.S., S.A.
Lisbon
24,642,300
EUR
Banking services
23.3%
21.9%
\u2014
UNICRE - Institui\u00e7\u00e3o Financeira
de Cr\u00e9dito, S.A.
Lisbon
10,000,000
EUR
Credit cards
32%
32%
0.54%
Webspectator Corporation
Delaware
950
USD
Digital advertising
services
25.1%
25.1%
25.1%
equity method were as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Millenniumbcp Ageas Grupo
Segurador,\u00a0 S.G.P.S., S.A.
Lisbon
50,002,375
EUR
Holding company
49%
49%
49%
Ocidental - Companhia Portuguesa
de Seguros de Vida, S.A.
Lisbon
22,375,000
EUR
Life insurance
49%
49%
\u2014
Ageas - Sociedade Gestora de
Fundos de Pens\u00f5es, S.A.
Lisbon
1,200,000
EUR
Pension fund
management
49%
49%
\u2014
Fidelidade Mo\u00e7ambique -
Companhia de Seguros S.A.(*)
Maputo
295,000,000
MZN
Insurance
22%
14.7%
\u2014
In December 2022, Seguradora Internacional de Mo\u00e7ambique, S.A. changed its corporate name to Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.
Some indicators of the main subsidiaries and associated companies are analysed as follows:
2022
2021
Subsidiaries and associated companies
Total
Assets
Total
Equity
Net income
for the year
Total
Assets
Total
Equity
Net income
for the year
Banco ActivoBank, S.A.
3,271,355
213,017
19,142
2,786,258
194,491
13,536
Bank Millennium, S.A. (1)
23,697,447
1,173,617
(216,683)
22,669,323
1,461,037
(291,927)
BIM - Banco Internacional de Mo\u00e7ambique, S.A. (1)
2,824,409
521,192
106,030
2,526,707
558,904
95,566
BCP International B.V.
524,966
524,627
87,434
976,464
976,192
(361)
BCP Finance Bank, Ltd.
520,294
519,976
4,996
520,002
519,686
4,227
BCP \u00c1frica, S.G.P.S., Lda.
561,713
560,269
60,975
500,105
499,294
(26,955)
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade
Unipessoal, Lda.
179,441
178,297
11,406
177,258
177,244
10,353
Interfundos - Sociedade Gestora de Organismos de\u00a0
Investimento Coletivo, S.A.
9,731
8,113
2,084
9,228
7,722
2,531
Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. (1) (2)
8,876,759
401,717
74,425
10,693,447
820,921
69,900
Banco Millennium Atl\u00e2ntico, S.A. (3)
2,910,070
292,893
10,693
2,712,137
296,392
11,563
Banque BCP, S.A.S.
4,944,774
268,097
23,499
4,477,971
236,548
20,447
1) Consolidated accounts.
2) Includes VOBA annual amortisation. The value of the acquired business (VOBA) corresponds to the estimated current value of the
future cash flows of the contracts in force at the date of acquisition and it is recognised in the consolidated accounts of Millenniumbcp
Ageas Grupo Segurador, S.G.P.S., S.A. as intangible assets and is amortised over the period of recognition of the income associated
with the policies acquired.
3) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInAssociatesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-653": { "value": "
This balance is comprised of:
(Thousands of euros)
2022
2021
Gains /(Losses) on disposal of investments
(283)
200
Gains /(Losses) on disposal of other assets
10,450
2,370
10,167
2,570
The balance Gains /(Losses) on disposal of other assets includes essentially gains on disposal of assets held by the Group
and classified as non-current assets held for sale which corresponds to a gain of Euros 11,323,000 in 2022 (2021: gain of
Euros 4,719,000).
Other assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposit account applications
51,371
396,638
Capital supplies
178,725
244,991
Obligations with post-employment benefits (note 50)
593,494
202,366
Debtors for futures and options transactions
191,290
138,688
Debtors
\u00a0 Residents
\u00a0\u00a0Receivables from real estate,\u00a0transfers of assets and other securities
111,693
109,509
\u00a0\u00a0\u00a0\u00a0 Prosecution cases / agreements with the Bank
12,163
13,037
\u00a0\u00a0\u00a0\u00a0 SIBS
3,521
3,490
\u00a0\u00a0\u00a0\u00a0 Others
66,744
23,569
\u00a0 Non-residents
30,584
51,909
Amounts due for collection
80,024
81,082
Interest and other amounts receivable
69,613
69,354
Amounts receivable on trading activity
3,234
32,303
Amounts due from customers
51,229
29,020
Artistic patrimony
28,796
28,818
Prepaid expenses
23,654
23,157
Subsidies receivables
10,764
15,656
Other recoverable tax
9,082
11,696
Gold and other precious metals
3,640
3,851
Capital supplementary contributions
165
165
Associated companies
145
162
Sundry assets
254,276
166,030
1,774,207
1,645,491
Impairment for other assets
(191,752)
(260,199)
1,582,455
1,385,292
As referred in note 47, as at 31 December 2022, the item Capital supplies includes the amount of Euros 171,397,000 (31
December 2021: Euros 237,671,000) arising from the transfers of assets to Specialized recovery funds which have
impairment in the same amount.
As at 31 December 2021, the balance Deposit account applications included the amount of Euros 348,559,000 on the
Clearing houses / Clearing derivatives. During 2022, this type of operations was recorded directly in the book value of
trading and hedging derivatives, as a result of the change made in the clearing process from CTM (Collateralised-to-
Market) to STM (Settled-to-Market).
The balance Amounts receivable on trading activity includes amounts receivable within 3 business days of stock
exchange operations.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is to
periodically assess the collectability of these amounts and whenever impairment is identified, an impairment loss is
registered in the income statement.
The changes occurred in Impairment of other assets are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
260,199
265,342
Transfers resulting from changes in the Group's structure (SIM - Seguradora
Internacional de Mo\u00e7ambique)
(1,038)
(375)
Other transfers
908
536
Charge for the year (note 12)
17,699
16,618
Reversals for the year (note 12)
(7,047)
(9,263)
Amounts charged-off
(78,835)
(12,717)
Exchange rate differences
(134)
58
Balance at the end of the year
191,752
260,199
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-654": { "value": "
This balance is comprised of:
(Thousands of euros)
2022
2021
Gains /(Losses) on disposal of investments
(283)
200
Gains /(Losses) on disposal of other assets
10,450
2,370
10,167
2,570
The balance Gains /(Losses) on disposal of other assets includes essentially gains on disposal of assets held by the Group
and classified as non-current assets held for sale which corresponds to a gain of Euros 11,323,000 in 2022 (2021: gain of
Euros 4,719,000).
The following table presents a summary of financial information for the main subsidiaries included in this balance,
prepared in accordance with IFRS. The information is presented before inter-company eliminations:
(Thousands of euros)
Bank Millennium Group
BIM - Banco International
de Mo\u00e7ambique Group
2022
2021
2022
2021
Net profit for the year
(216,683)
(291,927)
106,030
95,566
Net profit for the year attributable to the shareholders
(108,558)
(146,255)
70,707
63,729
Net profit for the year attributable to non-controlling interests
(108,125)
(145,672)
35,323
31,837
Other comprehensive income attributable to the shareholders
(34,929)
(120,143)
23,390
67,178
Other comprehensive income attributable to non-controlling interests
(34,790)
(119,663)
11,685
34,215
Total comprehensive income
(286,402)
(531,733)
141,105
196,959
Balance sheet
Financial assets
23,055,876
22,101,264
2,606,994
2,339,401
Non-financial assets
641,571
568,059
217,416
187,306
Financial liabilities
(21,684,366)
(20,581,439)
(2,235,210)
(1,900,844)
Non-financial liabilities
(839,464)
(626,847)
(68,008)
(66,959)
Equity
1,173,617
1,461,037
521,192
558,904
Equity attributed to the shareholders
587,999
731,997
347,559
372,708
Equity attributed to the non-controlling interests
585,618
729,040
173,633
186,196
Cash flows arising from:
operating activities
2,134,937
608,072
104,089
90,046
investing activities
260,370
(121,421)
(12,141)
57,945
financing activities
(75,834)
(97,068)
(191,515)
(85,563)
Increase / (decrease) in cash and equivalents
2,319,473
389,583
(99,567)
62,428
Dividends paid during the year:
attributed to the shareholders
\u2014
\u2014
119,244
31,744
attributed to the non-controlling interests
\u2014
\u2014
59,572
15,859
\u2014
\u2014
178,816
47,603
List of subsidiary and associated companies of Banco Comercial Portugu\u00eas
Group
As at 31 December 2022, the Group's subsidiary companies included in the consolidated accounts using the full
consolidation method were as follows:
Group
Bank
Subsidiary companies
Head
office
Share
capital
Curre
ncy
Sector of activity
% economic
interests
% effective
held
% direct
held
Banco ActivoBank, S.A.
Lisbon
127,600,000
EUR
Banking
100%
100%
100%
Bank Millennium, S.A.
Warsaw
1,213,116,777
PLN
Banking
50.1%
50.1%
50.1%
Millennium Bank Hipoteczny S.A.
Warsaw
57,000,000
PLN
Banking
100%
50.1%
\u2014
BCP \u00c1frica, S.G.P.S., Lda.
Funchal
682,965,800
EUR
Holding company
100%
100%
100%
BIM - Banco Internacional de
Mo\u00e7ambique, S.A.
Maputo
4,500,000,000
MZN
Banking
66.7%
66.7%
\u2014
BCP Finance Bank, Ltd.
George
Town
246,000,000
USD
Banking
100%
100%
\u2014
BCP International B.V.
Amsterdam
18,000
EUR
Holding company
100%
100%
100%
Millennium BCP\u00a0 - Escrit\u00f3rio de
Representa\u00e7\u00f5es e Servi\u00e7os, Ltda.
S\u00e3o Paulo
70,062,159
BRL
Financial Services
100%
100%
100%
Millennium bcp Participa\u00e7\u00f5es,
S.G.P.S., Sociedade Unipessoal,
Lda.
Funchal
25,000
EUR
Holding company
100%
100%
100%
Interfundos - Sociedade Gestora
de Organismos de\u00a0 Investimento
Coletivo, S.A.
Oeiras
1,500,000
EUR
Investment fund
management
100%
100%
100%
Monumental Residence -
Sociedade Especial de
Investimento Imobili\u00e1rio de
Capital Fixo, SICAFI, S.A.
Oeiras
32,859,181
EUR
Real-estate
management
100%
100%
100%
Millennium bcp - Presta\u00e7\u00e3o de
Servi\u00e7os, A.C.E.
Lisbon
331,750
EUR
Services
98.6%
97.7%
93.2%
Millennium bcp Teleservi\u00e7os -
Servi\u00e7os de Com\u00e9rcio Electr\u00f3nico,
S.A.
Lisbon
50,004
EUR
E-commerce
100%
100%
100%
Flitptrel Tires, S.A.
Lisbon
50,000
EUR
Real-estate
company
100%
100%
100%
Bichorro \u2013 Empreendimentos
Tur\u00edsticos\u00a0 e Imobili\u00e1rios S.A.
Oeiras
2,150,000
EUR
Real-estate
management
100%
100%
\u2014
Finalgarve \u2013 Sociedade de
Promo\u00e7\u00e3o Imobili\u00e1ria\u00a0 Tur\u00edstica,
S.A.
Oeiras
250,000
EUR
Real-estate
management
100%
100%
\u2014
Fiparso \u2013 Sociedade Imobili\u00e1ria
S.A
Oeiras
50,000
EUR
Real-estate
company
100%
100%
\u2014
Millennium Consulting S.A.
Warsaw
4,339,500
PLN
Consulting services
100%
50.1%
\u2014
Millennium Goodie Sp.z.o.o.
Warsaw
500,000
PLN
Web portals
100%
50.1%
\u2014
Millennium Leasing, Sp.z o.o.
Warsaw
48,195,000
PLN
Leasing
100%
50.1%
\u2014
Millennium Service, Sp.z o.o.
Warsaw
1,000,000
PLN
Services
100%
50.1%
\u2014
Millennium Financial Services,
Sp.z o.o.
Warsaw
100,000
PLN
Services
100%
50.1%
\u2014
Piast Expert Sp. z o.o (em
liquida\u00e7\u00e3o)
Tychy
100,000
PLN
Marketing services
100%
50.1%
\u2014
Millennium Telecommunication
Services Sp. z o.o.
Warsaw
100,000
PLN
Brokerage services
100%
50.1%
\u2014
Millennium TFI - Towarzystwo
Funduszy Inwestycyjnych, S.A.
Warsaw
10,300,000
PLN
Investment fund
management
100%
50.1%
\u2014
(*) - Company classified as non-current assets held for sale.
During 2022, the Group proceeded with the liquidation of \"Millennium Fundo de Capitaliza\u00e7\u00e3o - Fundo de Capital de
Risco\".
The Group holds a securitization transaction regarding mortgage loans which was set through specifically created SPE.
As referred in accounting policy 1 B, when the substance of the relationships with the SPEs indicates that the Group
holds control of its activities, the SPE is fully consolidated, following the application of IFRS 10.
As at 31 December 2022, the Special Purpose Entity included in the consolidated accounts under the full consolidation
method is as follows:
Group
Bank
Special Purpose Entities
Head
office
Share
capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Magellan Mortgages No.3 Limited
Dublin
40,000
EUR
Special Purpose
Entities
82.4%
82.4%
82.4%
As at 31 December 2022, the Group's associated companies included in the consolidated accounts under the equity
method are as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Banco Millennium Atl\u00e2ntico, S.A.
Luanda
53,821,603,000
AOA
Banking
22.7%
22.5%
\u2014
Banque BCP, S.A.S.
Paris
198,295,587
EUR
Banking
19.0%
19.0%
19.0%
Lubuskie Fabryki Mebli, S.A. (em
liquida\u00e7\u00e3o)
Swiebodzin
13,400,050
PLN
Furniture
manufacturer
50%
25.1%
\u2014
SIBS, S.G.P.S., S.A.
Lisbon
24,642,300
EUR
Banking services
23.3%
21.9%
\u2014
UNICRE - Institui\u00e7\u00e3o Financeira
de Cr\u00e9dito, S.A.
Lisbon
10,000,000
EUR
Credit cards
32%
32%
0.54%
Webspectator Corporation
Delaware
950
USD
Digital advertising
services
25.1%
25.1%
25.1%
equity method were as follows:
Group
Bank
Associated companies
Head
office
Share capital
Curre
ncy
Activity
% economic
interests
% effective
held
% direct
held
Millenniumbcp Ageas Grupo
Segurador,\u00a0 S.G.P.S., S.A.
Lisbon
50,002,375
EUR
Holding company
49%
49%
49%
Ocidental - Companhia Portuguesa
de Seguros de Vida, S.A.
Lisbon
22,375,000
EUR
Life insurance
49%
49%
\u2014
Ageas - Sociedade Gestora de
Fundos de Pens\u00f5es, S.A.
Lisbon
1,200,000
EUR
Pension fund
management
49%
49%
\u2014
Fidelidade Mo\u00e7ambique -
Companhia de Seguros S.A.(*)
Maputo
295,000,000
MZN
Insurance
22%
14.7%
\u2014
In December 2022, Seguradora Internacional de Mo\u00e7ambique, S.A. changed its corporate name to Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.
Some indicators of the main subsidiaries and associated companies are analysed as follows:
2022
2021
Subsidiaries and associated companies
Total
Assets
Total
Equity
Net income
for the year
Total
Assets
Total
Equity
Net income
for the year
Banco ActivoBank, S.A.
3,271,355
213,017
19,142
2,786,258
194,491
13,536
Bank Millennium, S.A. (1)
23,697,447
1,173,617
(216,683)
22,669,323
1,461,037
(291,927)
BIM - Banco Internacional de Mo\u00e7ambique, S.A. (1)
2,824,409
521,192
106,030
2,526,707
558,904
95,566
BCP International B.V.
524,966
524,627
87,434
976,464
976,192
(361)
BCP Finance Bank, Ltd.
520,294
519,976
4,996
520,002
519,686
4,227
BCP \u00c1frica, S.G.P.S., Lda.
561,713
560,269
60,975
500,105
499,294
(26,955)
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade
Unipessoal, Lda.
179,441
178,297
11,406
177,258
177,244
10,353
Interfundos - Sociedade Gestora de Organismos de\u00a0
Investimento Coletivo, S.A.
9,731
8,113
2,084
9,228
7,722
2,531
Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. (1) (2)
8,876,759
401,717
74,425
10,693,447
820,921
69,900
Banco Millennium Atl\u00e2ntico, S.A. (3)
2,910,070
292,893
10,693
2,712,137
296,392
11,563
Banque BCP, S.A.S.
4,944,774
268,097
23,499
4,477,971
236,548
20,447
1) Consolidated accounts.
2) Includes VOBA annual amortisation. The value of the acquired business (VOBA) corresponds to the estimated current value of the
future cash flows of the contracts in force at the date of acquisition and it is recognised in the consolidated accounts of Millenniumbcp
Ageas Grupo Segurador, S.G.P.S., S.A. as intangible assets and is amortised over the period of recognition of the income associated
with the policies acquired.
3) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfSignificantInvestmentsInSubsidiariesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-655": { "value": "Net income from discontinued or discontinuing operations
The amount of this account is comprised of:
(Thousands of euros)
2022
2021
Banque Priv\u00e9e BCP (Suisse) S.A.
Net income before taxes
\u2014
1,424
Taxes on net income
\u2014
(223)
Gains arising on disposal of 100% investment held
\u2014
51,093
Gains on disposal of the investment held (price adjustment)
1,765
\u2014
1,765
52,294
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
Net income before taxes
\u2014
9,303
Taxes on net income
\u2014
(2,515)
Gains arising on disposal of investment held (70%)
\u2014
23,736
Correction of gains on disposal of the investment held
3,772
\u2014
Tax on gains arising on disposal
\u2014
(11,937)
3,772
18,587
5,537
70,881
As at 31 December 2022, the Bank's share capital amounts to Euros 3,000,000,000 (2021: Euros 4,725,000,000) and is
represented by 15,113,989,952 nominative book-entry shares without nominal value, fully subscribed and paid up. As
described in note 48, pursuant to the resolutions adopted at the General Meeting held on 20 December 2022, the Bank
registered its new share capital of 3,000,000,000 Euros, maintaining the number of nominatives, book-entry shares
without nominal value and of the voting rights.
There were not identified another dilution effects of the earnings per share as at 31 December 2022 and 2021, so the
diluted result is equivalent to the basic result.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEarningsPerShareExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-657": { "value": "Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Cash
593,033
601,772
Central Banks
Bank of Portugal
3,370,139
6,418,682
Central Banks abroad
2,058,829
775,845
6,022,001
7,796,299
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy the
legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective liabilities.
According to the European Central Bank System for Euro Zone, the cash reserve requirements establish the
maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other liabilities,
during each reserve requirement period. The rate is different for countries outside the Euro Zone.
In addition, from the reserve counting period started on 30 October 2019, the ECB introduced the tiering regime, in
which the balance with the Central Bank in excess of the minimum cash reserves, up to an estimated maximum of 6
times of the reserves, is remunerated at the central bank's lending rate instead of the deposit rate.
Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Credit institutions in Portugal
2,338
24,301
Credit institutions abroad
112,443
278,860
Amounts due for collection
98,679
58,625
213,460
361,786
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in
the respective contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred
operations (IRS and CIRS), whose revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2022
2021
Up to 3 months
752,913
428,202
3 to 6 months
79,247
9,723
6 to 12 months
132,136
7,164
1 to 5 years
\u2014
9,311
964,296
454,400
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,187
304
Transfers
\u2014
(1)
Impairment charge for the year (note 11)
349
911
Reversals for the year (note 11)
(673)
(27)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
862
1,187
", "dimensions": { "concept": "ifrs-full:DisclosureOfRestrictedCashAndCashEquivalentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-658": { "value": "Cash and deposits at Central Banks
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Cash
593,033
601,772
Central Banks
Bank of Portugal
3,370,139
6,418,682
Central Banks abroad
2,058,829
775,845
6,022,001
7,796,299
The balance Central Banks includes deposits at Central Banks of the countries where the Group operates to satisfy the
legal requirements to maintain a cash reserve calculated based on the value of deposits and other effective liabilities.
According to the European Central Bank System for Euro Zone, the cash reserve requirements establish the
maintenance of a deposit with the Central Bank equivalent to 1% of the average value of deposits and other liabilities,
during each reserve requirement period. The rate is different for countries outside the Euro Zone.
In addition, from the reserve counting period started on 30 October 2019, the ECB introduced the tiering regime, in
which the balance with the Central Bank in excess of the minimum cash reserves, up to an estimated maximum of 6
times of the reserves, is remunerated at the central bank's lending rate instead of the deposit rate.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCashAndBankBalancesAtCentralBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-659": { "value": "Loans and advances to credit institutions repayable on demand
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Credit institutions in Portugal
2,338
24,301
Credit institutions abroad
112,443
278,860
Amounts due for collection
98,679
58,625
213,460
361,786
(*) Under the scope of derivative financial instruments operations (IRS and CIRS) with institutional counterparties, and as defined in
the respective contracts (\"Cash collateral\"), these deposits are held by the counterparties and are given as collateral of the referred
operations (IRS and CIRS), whose revaluation is negative for the Group.
This balance analysed by the period to maturity, before impairment, is as follows:
(Thousands of euros)
2022
2021
Up to 3 months
752,913
428,202
3 to 6 months
79,247
9,723
6 to 12 months
132,136
7,164
1 to 5 years
\u2014
9,311
964,296
454,400
The changes occurred in impairment of Loans and advances to credit institutions are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,187
304
Transfers
\u2014
(1)
Impairment charge for the year (note 11)
349
911
Reversals for the year (note 11)
(673)
(27)
Exchange rate differences
(1)
\u2014
Balance at the end of the year
862
1,187
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
", "dimensions": { "concept": "ifrs-full:DisclosureOfLoansAndAdvancesToBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-660": { "value": "Loans and advances to customers
The analysis of loans and advances to customers, by type of credit, is as follows:
(Thousands of euros)
2022
2021
Mortgage loans
28,658,104
28,544,360
Loans
17,672,581
18,298,171
Finance leases
4,176,329
4,155,758
Factoring operations
3,022,248
2,725,080
Current account credits
822,473
817,440
Overdrafts
1,046,121
1,073,654
Discounted bills
201,081
143,109
55,598,937
55,757,572
Overdue loans - less than 90 days
94,063
127,928
Overdue loans - Over 90 days
485,166
936,185
56,178,166
56,821,685
Loans impairment
(1,502,373)
(1,849,284)
54,675,793
54,972,401
The balances Asset-backed loans and Other guaranteed loans follow the subsequent types of guarantees considered:
\u2013Asset-backed loans: Financial collaterals, physical collaterals (movable or immovable) and amounts receivable (income
consignment);
\u2013Credit with other guarantees: First-demand guarantees issued by banks or other entities and personal guarantees.
The balance Loans and advances to customers, as at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
Public sector
635,424
\u2014
635,424
(1,681)
633,743
Asset-backed loans
32,425,246
528,636
32,953,882
(839,830)
32,114,052
Other guaranteed loans
6,182,245
99,957
6,282,202
(226,767)
6,055,435
Unsecured loans
7,423,516
347,056
7,770,572
(541,446)
7,229,126
Foreign loans
2,210,303
8,497
2,218,800
(30,443)
2,188,357
Factoring operations
2,725,080
11,304
2,736,384
(41,967)
2,694,417
Finance leases
4,155,758
68,663
4,224,421
(167,150)
4,057,271
55,757,572
1,064,113
56,821,685
(1,849,284)
54,972,401
As at 31 December 2022, the balance Loans and advances to customers includes the amount of Euros 10,613,589,000
(31 December 2021: Euros 11,896,688,000) regarding mortgage loans assigned to the cover pool backing the Group\u2019s
covered bond programme issuances.
As part of the liquidity risk management, the Group holds a pool of eligible assets that can serve as collateral in funding
operations with the European Central Bank and other Central Banks in countries where the Group operates, which
include loans and advances to customers.
As referred in note 51, the Group provides loans and/or guarantees to qualifying shareholders holding individually or
together with their affiliates, 5% or more of the share capital identified in the Board of Directors report and in note 41.
As at 31 December 2022, the Group granted credit to qualifying shareholders and entities controlled by them, in the
amount of Euros 98,658,000 (31 December 2021: Euros 152,056,000), as referred in note 51 a). The amount of
impairment recognised for these contracts amounts to Euros 914,000 (31 December 2021: Euros 3,140,000).
The conclusion of business between the Company and holders of qualifying holdings or individuals or legal entities
related to them in accordance with the provisions of article 33.\u00ba, n.\u00ba 3 of Notice 3/2020 of Bank of Portugal, regardless
of the amount, is always subject of consideration and deliberation by the Board of Directors, after obtaining a prior
opinion from the Audit Committee, and by proposal of the Executive Committee, which in turn deliberates under
proposal from the Credit Committee, after obtaining an analysis and opinion from the Compliance Office, which
pronounces regarding the compliance of the proposed operations with internal regulations, legal and regulatory
provisions and other conditions that may apply to them, and the Risk Office, which evaluates and issues an opinion on
the risks inherent to the operation.
As at 31 December 2022, the balance Finance leases includes the amount of Euros 348,000 (31 December 2021: Euros
6,938,000) relative to sublease operations, as referred in accounting policy 1 H.
The analysis of the outstanding amount of financial lease contracts, by type of client, is presented as follows:
(Thousands of euros)
2022
2021
Individuals
Home
43,402
48,249
Consumer
27,606
31,359
Others
75,666
83,744
146,674
163,352
Companies
Equipment
1,890,361
1,889,697
Real estate
2,139,294
2,102,709
4,029,655
3,992,406
4,176,329
4,155,758
The analysis of loans and advances to customers, as at 31 December 2022, by sector of activity, is as follows:
(Thousands of euros)
2022
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
461,680
8,517
470,197
(13,879)
456,318
0.84%
Fisheries
25,308
3,226
28,534
(2,563)
25,971
0.05%
Mining
70,970
1,676
72,646
(5,249)
67,397
0.13%
Food, beverage and tobacco
813,359
11,634
824,993
(26,201)
798,792
1.47%
Textiles
497,338
8,989
506,327
(17,109)
489,218
0.90%
Wood and cork
260,175
3,730
263,905
(5,364)
258,541
0.47%
Paper, printing and publishing
148,937
742
149,679
(3,924)
145,755
0.27%
Chemicals
862,826
38,334
901,160
(63,538)
837,622
1.60%
Machinery, equipment and basic
metallurgical
1,526,778
25,298
1,552,076
(56,649)
1,495,427
2.76%
Electricity and gas
229,821
443
230,264
(1,285)
228,979
0.41%
Water
204,736
452
205,188
(8,371)
196,817
0.37%
Construction
1,497,114
21,639
1,518,753
(141,991)
1,376,762
2.70%
Retail business
1,705,882
18,730
1,724,612
(36,848)
1,687,764
3.07%
Wholesale business
2,225,903
26,755
2,252,658
(67,081)
2,185,577
4.01%
Restaurants and hotels
1,505,963
15,721
1,521,684
(71,192)
1,450,492
2.71%
Transports
1,320,236
7,464
1,327,700
(20,751)
1,306,949
2.36%
Post offices
19,918
254
20,172
(412)
19,760
0.04%
Telecommunications
411,885
1,508
413,393
(9,411)
403,982
0.74%
Services
Financial intermediation
2,047,265
2,149
2,049,414
(44,691)
2,004,723
3.65%
Real estate activities
1,978,182
10,931
1,989,113
(35,469)
1,953,644
3.54%
Consulting, scientific and technical
activities
969,410
8,232
977,642
(86,718)
890,924
1.74%
Administrative and support services
activities
532,237
4,296
536,533
(57,220)
479,313
0.96%
Public sector
823,904
\u2014
823,904
(2,545)
821,359
1.47%
Education
143,930
814
144,744
(14,627)
130,117
0.26%
Health and collective service activities
378,423
1,029
379,452
(7,108)
372,344
0.68%
Artistic, sports and recreational
activities
236,543
2,128
238,671
(37,124)
201,547
0.43%
Other services
234,399
2,971
237,370
(101,356)
136,014
0.42%
Consumer loans
5,775,239
237,160
6,012,399
(369,220)
5,643,179
10.70%
Mortgage credit
28,012,946
110,809
28,123,755
(181,551)
27,942,204
50.06%
Other domestic activities
1,377
332
1,709
(38)
1,671
0%
Other international activities
676,253
3,266
679,519
(12,888)
666,631
1.21%
55,598,937
579,229
56,178,166
(1,502,373)
54,675,793
100%
The analysis of loans and advances to customers, as at 31 December 2021, by sector of activity, is as follows:
(Thousands of euros)
2021
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
Net
amount
% Gross
amount
Agriculture and forestry
444,936
6,142
451,078
(10,764)
440,314
0.79%
Fisheries
38,039
1,148
39,187
(2,752)
36,435
0.07%
Mining
87,811
1,943
89,754
(2,038)
87,716
0.16%
Food, beverage and tobacco
806,228
8,326
814,554
(22,048)
792,506
1.43%
Textiles
528,010
9,436
537,446
(17,959)
519,487
0.95%
Wood and cork
274,385
5,520
279,905
(11,116)
268,789
0.49%
Paper, printing and publishing
189,495
605
190,100
(3,799)
186,301
0.34%
Chemicals
841,454
25,028
866,482
(44,219)
822,263
1.53%
Machinery, equipment and basic
metallurgical
1,568,322
30,550
1,598,872
(56,605)
1,542,267
2.81%
Electricity and gas
237,037
837
237,874
(2,515)
235,359
0.42%
Water
223,210
352
223,562
(19,330)
204,232
0.39%
Construction
1,715,141
36,691
1,751,832
(120,633)
1,631,199
3.08%
Retail business
1,772,527
27,490
1,800,017
(52,210)
1,747,807
3.17%
Wholesale business
2,319,324
34,827
2,354,151
(85,691)
2,268,460
4.14%
Restaurants and hotels
1,669,080
16,810
1,685,890
(128,012)
1,557,878
2.97%
Transports
1,349,930
13,804
1,363,734
(37,792)
1,325,942
2.40%
Post offices
18,695
208
18,903
(461)
18,442
0.03%
Telecommunications
437,097
1,773
438,870
(12,275)
426,595
0.77%
Services
Financial intermediation
1,886,333
65,780
1,952,113
(118,938)
1,833,175
3.44%
Real estate activities
1,868,624
11,680
1,880,304
(50,639)
1,829,665
3.31%
Consulting, scientific and technical
activities
879,296
5,301
884,597
(60,492)
824,105
1.56%
Administrative and support services
activities
588,528
6,725
595,253
(64,140)
531,113
1.05%
Public sector
903,437
\u2014
903,437
(2,848)
900,589
1.59%
Education
151,152
1,002
152,154
(13,240)
138,914
0.27%
Health and collective service activities
401,740
1,306
403,046
(15,802)
387,244
0.71%
Artistic, sports and recreational
activities
347,660
42,689
390,349
(108,601)
281,748
0.69%
Other services
229,001
242,691
471,692
(206,320)
265,372
0.83%
Consumer loans
5,599,131
305,938
5,905,069
(391,664)
5,513,405
10.39%
Mortgage credit
27,920,953
151,456
28,072,409
(173,316)
27,899,093
49.40%
Other domestic activities
1,080
707
1,787
(108)
1,679
0.00%
Other international activities
459,916
7,348
467,264
(12,957)
454,307
0.82%
55,757,572
1,064,113
56,821,685
(1,849,284)
54,972,401
100.00%
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31 December 2022, is as
follows:
(Thousands of euros)
2022
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
104,760
181,701
175,219
461,680
8,517
470,197
Fisheries
3,756
12,465
9,087
25,308
3,226
28,534
Mining
17,107
42,103
11,760
70,970
1,676
72,646
Food, beverage and tobacco
408,663
307,334
97,362
813,359
11,634
824,993
Textiles
154,019
265,451
77,868
497,338
8,989
506,327
Wood and cork
92,259
135,429
32,487
260,175
3,730
263,905
Paper, printing and publishing
42,397
76,818
29,722
148,937
742
149,679
Chemicals
335,828
396,647
130,351
862,826
38,334
901,160
Machinery, equipment and basic
metallurgical
559,264
742,898
224,616
1,526,778
25,298
1,552,076
Electricity and gas
55,254
67,104
107,463
229,821
443
230,264
Water
35,418
80,638
88,680
204,736
452
205,188
Construction
524,861
638,536
333,717
1,497,114
21,639
1,518,753
Retail business
668,493
729,772
307,617
1,705,882
18,730
1,724,612
Wholesale business
1,011,781
933,752
280,370
2,225,903
26,755
2,252,658
Restaurants and hotels
81,252
523,536
901,175
1,505,963
15,721
1,521,684
Transports
334,717
840,728
144,791
1,320,236
7,464
1,327,700
Post offices
12,384
6,551
983
19,918
254
20,172
Telecommunications
82,116
274,708
55,061
411,885
1,508
413,393
Services
Financial intermediation
194,026
783,252
1,069,987
2,047,265
2,149
2,049,414
Real estate activities
345,774
830,401
802,007
1,978,182
10,931
1,989,113
Consulting, scientific and technical
activities
211,357
387,691
370,362
969,410
8,232
977,642
Administrative and support services
activities
122,350
278,364
131,523
532,237
4,296
536,533
Public sector
84,965
283,426
455,513
823,904
\u2014
823,904
Education
29,436
47,613
66,881
143,930
814
144,744
Health and collective service activities
70,100
167,080
141,243
378,423
1,029
379,452
Artistic, sports and recreational
activities
11,618
64,764
160,161
236,543
2,128
238,671
Other services
70,922
121,649
41,828
234,399
2,971
237,370
Consumer loans
1,901,816
2,744,264
1,129,159
5,775,239
237,160
6,012,399
Mortgage credit
464,882
1,593,206
25,954,858
28,012,946
110,809
28,123,755
Other domestic activities
247
477
653
1,377
332
1,709
Other international activities
432,937
81,442
161,874
676,253
3,266
679,519
8,464,759
13,639,800
33,494,378
55,598,937
579,229
56,178,166
The analysis of loans and advances to customers, by maturity and by sector of activity, as at 31 December 2021, is as
follows:
(Thousands of euros)
2021
Outstanding loans
Due within
1 year
1 year to
5 years
Over 5
years
Total
Outstanding
Overdue
loans
Total
Agriculture and forestry
105,704
161,400
177,832
444,936
6,142
451,078
Fisheries
5,753
14,677
17,609
38,039
1,148
39,187
Mining
16,303
58,651
12,857
87,811
1,943
89,754
Food, beverage and tobacco
359,259
332,183
114,786
806,228
8,326
814,554
Textiles
137,952
277,945
112,113
528,010
9,436
537,446
Wood and cork
99,291
131,284
43,810
274,385
5,520
279,905
Paper, printing and publishing
75,064
74,969
39,462
189,495
605
190,100
Chemicals
267,511
412,437
161,506
841,454
25,028
866,482
Machinery, equipment and basic
metallurgical
521,463
759,272
287,587
1,568,322
30,550
1,598,872
Electricity and gas
48,354
66,317
122,366
237,037
837
237,874
Water
31,754
57,684
133,772
223,210
352
223,562
Construction
510,600
742,757
461,784
1,715,141
36,691
1,751,832
Retail business
668,955
756,484
347,088
1,772,527
27,490
1,800,017
Wholesale business
914,425
1,082,909
321,990
2,319,324
34,827
2,354,151
Restaurants and hotels
88,460
512,541
1,068,079
1,669,080
16,810
1,685,890
Transports
292,026
692,834
365,070
1,349,930
13,804
1,363,734
Post offices
11,885
5,976
834
18,695
208
18,903
Telecommunications
87,200
273,315
76,582
437,097
1,773
438,870
Services
Financial intermediation
213,955
401,976
1,270,402
1,886,333
65,780
1,952,113
Real estate activities
316,696
819,454
732,474
1,868,624
11,680
1,880,304
Consulting, scientific and technical
activities
174,787
312,648
391,861
879,296
5,301
884,597
Administrative and support services
activities
146,087
272,501
169,940
588,528
6,725
595,253
Public sector
78,613
349,831
474,993
903,437
\u2014
903,437
Education
29,090
50,130
71,932
151,152
1,002
152,154
Health and collective service activities
67,409
166,250
168,081
401,740
1,306
403,046
Artistic, sports and recreational
activities
48,141
54,849
244,670
347,660
42,689
390,349
Other services
75,324
83,111
70,566
229,001
242,691
471,692
Consumer loans
1,772,975
2,675,033
1,151,123
5,599,131
305,938
5,905,069
Mortgage credit
483,741
2,017,730
25,419,482
27,920,953
151,456
28,072,409
Other domestic activities
250
402
428
1,080
707
1,787
Other international activities
215,105
98,822
145,989
459,916
7,348
467,264
7,864,132
13,716,372
34,177,068
55,757,572
1,064,113
56,821,685
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31 December 2022, is as
follows:
(Thousands of euros)
2022
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
21,138
19,832
543,029
583,999
\u2014
583,999
Asset-backed loans
1,608,240
3,615,091
27,010,051
32,233,382
123,063
32,356,445
Other guaranteed loans
842,171
3,866,580
958,781
5,667,532
100,085
5,767,617
Unsecured loans
2,660,372
3,452,035
1,345,905
7,458,312
258,186
7,716,498
Foreign loans
171,535
785,272
1,500,328
2,457,135
2,451
2,459,586
Factoring operations
2,592,313
426,935
3,000
3,022,248
16,680
3,038,928
Finance leases
568,990
1,474,055
2,133,284
4,176,329
78,764
4,255,093
8,464,759
13,639,800
33,494,378
55,598,937
579,229
56,178,166
The analysis of loans and advances to customers, by type of credit and by maturity, as at 31 December 2021, is as
follows:
(Thousands of euros)
2021
Outstanding loans
Due within
1 year
1 year to
5 years
Over
5 years
Total
Outstanding
Overdue
loans
Total
Public sector
24,756
28,028
582,640
635,424
\u2014
635,424
Asset-backed loans
1,638,995
3,843,990
26,942,261
32,425,246
528,636
32,953,882
Other guaranteed loans
811,185
3,992,200
1,378,860
6,182,245
99,957
6,282,202
Unsecured loans
2,480,837
3,515,890
1,426,789
7,423,516
347,056
7,770,572
Foreign loans
129,608
377,963
1,702,732
2,210,303
8,497
2,218,800
Factoring operations
2,217,684
507,242
154
2,725,080
11,304
2,736,384
Finance leases
561,067
1,451,059
2,143,632
4,155,758
68,663
4,224,421
7,864,132
13,716,372
34,177,068
55,757,572
1,064,113
56,821,685
The item Loans and advances to customers, split by stage according with IFRS 9, is analysed as follows:
(Thousands of euros)
2022
2021
Stage 1
Gross amount
46,404,751
46,115,097
Impairment
(214,469)
(207,328)
46,190,282
45,907,769
Stage 2
Gross amount
7,567,944
7,969,921
Impairment
(284,653)
(283,657)
7,283,291
7,686,264
Stage 3
Gross amount
2,205,471
2,736,666
Impairment
(1,003,251)
(1,358,298)
1,202,220
1,378,368
54,675,793
54,972,401
The exposure and impairment of the above table also includes the operations classified as POCI as detailed in note 54.
The analysis of the exposure covered by collaterals associated with loans and advances to customers' portfolio, by stage
according with IFRS 9, considering the collaterals' fair value, is as follows:
(Thousands of euros)
2022
2021
Stage 1
Securities and other financial assets
1,533,809
1,253,189
Residential real estate
24,796,864
23,489,794
Other real estate
3,475,795
3,182,387
Other guarantees
7,654,261
6,961,806
37,460,729
34,887,176
Stage 2
Securities and other financial assets
192,025
268,388
Residential real estate
2,507,458
2,645,791
Other real estate
1,158,362
1,551,993
Other guarantees
1,744,218
1,715,619
5,602,063
6,181,791
Stage 3
Securities and other financial assets
28,765
71,291
Residential real estate
432,138
540,907
Other real estate
516,903
578,807
Other guarantees
235,900
404,485
1,213,706
1,595,490
44,276,498
42,664,457
consequent establishment of a new funding to replace the previous and which arise to the marking of operations as
being restructured due to financial difficulties of customers. The restructuring may include in a reinforce of
guarantees, liquidation of part of the credit as well as changes in the payment plan and/or in interest rate. The
analysis of the restructured loans, by sector of activity, is as follows:
(Thousands of euros)
2022
2021
Restructured
loans
Impairment
(*)
Net amount
Restructured
loans
Impairment
(*)
Net amount
Agriculture and forestry
15,009
(2,216)
12,793
12,408
(2,838)
9,570
Fisheries
2,772
(1,762)
1,010
3,705
(1,568)
2,137
Mining
1,305
(199)
1,106
10,360
(275)
10,085
Food, beverage and tobacco
28,393
(10,112)
18,281
26,556
(7,468)
19,088
Textiles
14,120
(4,981)
9,139
14,877
(4,336)
10,541
Wood and cork
6,088
(784)
5,304
7,030
(1,034)
5,996
Paper, printing and publishing
8,698
(1,701)
6,997
6,911
(1,825)
5,086
Chemicals
30,146
(11,809)
18,337
27,056
(8,744)
18,312
Machinery, equipment and basic
metallurgical
74,637
(22,688)
51,949
79,015
(16,826)
62,189
Electricity and gas
1,133
(255)
878
603
(113)
490
Water
1,767
(734)
1,033
14,812
(9,673)
5,139
Construction
151,970
(94,787)
57,183
183,645
(74,672)
108,973
Retail business
38,861
(10,085)
28,776
42,916
(13,218)
29,698
Wholesale business
68,474
(13,627)
54,847
86,149
(14,276)
71,873
Restaurants and hotels
97,002
(16,126)
80,876
130,031
(17,508)
112,523
Transports
9,620
(1,767)
7,853
9,945
(2,001)
7,944
Post offices
125
(33)
92
149
(56)
93
Telecommunications
25,228
(4,066)
21,162
28,566
(5,225)
23,341
Services
Financial intermediation
54,764
(19,879)
34,885
144,402
(76,108)
68,294
Real estate activities
45,785
(9,927)
35,858
96,019
(15,212)
80,807
Consulting, scientific and technical
activities
190,444
(63,606)
126,838
205,449
(33,369)
172,080
Administrative and support services
activities
67,941
(46,519)
21,422
72,439
(45,569)
26,870
Public sector
63,016
(427)
62,589
58,940
(307)
58,633
Education
17,310
(11,358)
5,952
20,357
(10,415)
9,942
Health and collective service
activities
8,428
(1,206)
7,222
29,690
(7,853)
21,837
Artistic, sports and recreational
activities
19,732
(8,865)
10,867
166,973
(91,547)
75,426
Other services
11,855
(1,601)
10,254
249,210
(176,099)
73,111
Consumer loans
274,500
(99,459)
175,041
273,902
(93,134)
180,768
Mortgage credit
535,948
(69,129)
466,819
555,922
(55,970)
499,952
Other domestic activities
\u2014
\u2014
\u2014
48
(26)
22
Other international activities
977
(594)
383
5,910
(5,169)
741
1,866,048
(530,302)
1,335,746
2,563,995
(792,434)
1,771,561
(*)The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology
described in point i. of the section \"Additional measures with impact on the Impairment level\" of note 54.
The breakdown of the restructured loans as at 31 December 2022, by restructuring measure, is as follows:
(Thousands of euros)
2022
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
40,796
383,529
64,104
447,633
(130,635)
316,998
Introduction of the grace period for
capital and / or interest
7,359
433,555
30,187
463,742
(134,502)
329,240
Interest rate reduction
3,933
147,583
5,694
153,277
(105,411)
47,866
Payment plan change
10,832
233,879
9,338
243,217
(21,762)
221,455
Debt relief
105
935
1,693
2,628
(1,391)
1,237
Debt-asset swaps
4
368
21
389
(31)
358
Other restructured loans
6,877
507,410
47,752
555,162
(136,570)
418,592
69,906
1,707,259
158,789
1,866,048
(530,302)
1,335,746
The breakdown of the restructured loans as at 31 December 2021, by restructuring measure, is as follows:
(Thousands of euros)
2021
Number of
operations
Outstanding
loans
Overdue
loans
Gross
amount
Impairment
(*)
Net
amount
Extension of the repayment term
39,767
614,627
76,723
691,350
(149,925)
541,425
Introduction of the grace period for
capital and / or interest
6,303
459,222
352,001
811,223
(352,912)
458,311
Interest rate reduction
4,949
248,877
11,085
259,962
(130,692)
129,270
Payment plan change
9,826
287,763
7,813
295,576
(28,135)
267,441
Debt relief
289
1,630
5,692
7,322
(5,055)
2,267
Debt-asset swaps
7
441
1,270
1,711
(1,318)
393
Other restructured loans
10,263
425,088
71,763
496,851
(124,397)
372,454
71,404
2,037,648
526,347
2,563,995
(792,434)
1,771,561
(*) The impairment presented in the tables does not include the amounts of impairment calculated using the overlays methodology described in
point i. of the section \"Additional measures with impact on the Impairment level\" of note 54.
The restructured loans are also subject to an impairment analysis resulting from the revaluation of expectation to meet
new cash flows inherent to the new contract terms and considering new collaterals.
The Group has implemented a process for marking operations restructured due to clients' financial difficulties. This
marking is part of the credit analysis process, being in charge of the respective decision-making bodies, according to
the corresponding competencies, established in the regulations in force.
The information on operations restructured due to financial difficulties is available in the Group's information systems,
having a relevant role in the processes of credit analysis, in the marking of customers in default and in the process of
determining impairment. In particular:
- there are several default triggers related to restructuring due to financial difficulties (restructuring with loss of value,
recidivism of restructuring, default on customers with restructured operations);
- in the process of individual impairment analysis, in addition to the existence of operations restructured due to
financial difficulties, being a reason for customer selection, the loss inherent to the change in the conditions resulting
from the restructuring is determined.
The demarcation of an operation marked as restructured due to financial difficulties, can only take place at least 2
periods after the date of marking, provided that a set of conditions exist that allow to conclude by the improvement of
the financial condition of the client. In the case of credits marked as Non-Performing Exposure (NPE), this 2-year period
will only start on the date of classification of the credit as performing.
The definition of Non-Performing Loans for more than 90 days (NPL > 90) incorporates total credit (past due plus
outstanding) associated with past due operations for more than 90 days. As at 31 December 2022, the amount
calculated is Euros 725,300,000 (31 December 2021: Euros 1,236,979,000).
All customers who check at least one of the following conditions are marked in default and therefore as NPE:
- Material payment delay of more than 90 days in the amounts of principal, interest or unpaid commissions on the due
date that, cumulatively, represent: more than 100 euros (retail) or more than 500 euros (non-retail); and more than 1%
of the total debt (direct liabilities).
- Indications of low probability of payment:
a) Credit restructuring due to financial difficulties with loss of value; b) Delay after restructuring due to financial
difficulties; c) Recurrence of restructuring due to financial difficulties; d) Credit with signs of impairment (or Stage 3 of
IFRS 9); e) Insolvency or equivalent process; f) Litigation; g) Guarantees of operations in default; h) Loss of credit sales;
i) Credit fraud; j) Unpaid credit status; k) Breach of covenants in a credit agreement; l) Contagion of default in an
economic group; m) Cross default in the BCP Group.
As at 31 December 2022, the NPE associated with Loans and advances customers at amortized cost amounts to Euros
2,205,471,000 (31 December 2021: Euros 2,736,666,000).
The changes occurred in Loans impairment are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,849,284
2,036,522
Charge for the year in net income interest
32,942
25,935
Transfers resulting from changes in the Group's structure
\u2014
(375)
Other transfers
(53,634)
4,778
Impairment charge for the year (note 11)
830,750
861,212
Reversals for the year (note 11)
(506,926)
(487,084)
Loans charged-off
Write-offs
(458,405)
(372,710)
Credit assignments
(189,061)
(227,470)
Exchange rate differences
(2,577)
8,476
Balance at the end of the year
1,502,373
1,849,284
The analysis of recovered loans and interest occurred during 2022 and 2021, by sector of activity, is as follows:
(Thousands of euros)
2022
2021
Agriculture and forestry
6
159
Mining
\u2014
97
Food, beverage and tobacco
34
95
Textiles
41
245
Wood and cork
43
26
Paper, printing and publishing
\u2014
2
Chemicals
105
673
Machinery, equipment and basic metallurgical
165
1,216
Electricity and gas
\u2014
12
Water
\u2014
9
Construction
2,719
1,591
Retail business
757
1,016
Wholesale business
113
811
Restaurants and hotels
67
121
Transports
56
137
Post offices
1
2
Telecommunications
2
5
Services
Financial intermediation
619
143
Real estate activities
483
146
Consulting, scientific and technical activities
8
37
Administrative and support services activities
29
931
Education
5
2
Health and collective service activities
1
1
Artistic, sports and recreational activities
3
6
Other services
8
75
Consumer loans
13,967
13,185
Mortgage credit
130
832
Other domestic activities
29
1,198
Other international activities
1,446
165
20,837
22,938
The analysis of recovered loans and interest occurred during 2022 and 2021, by type of credit, is as follows:
(Thousands of euros)
2022
2021
Asset-backed loans
130
818
Other guaranteed loans
4,237
1,547
Unsecured loans
16,301
18,089
Foreign loans
80
1,210
Factoring operations
\u2014
22
Finance leases
89
1,252
20,837
22,938
with this operation amounts to Euros 188,214.000 (31 December 2021: Euros 215.259.000) and bonds issued with
different subordination levels amount to Euros 142.062.000 (this amount excludes bonds hold by the Group in the
amount of Euros 63.937.000) and the most subordinated tranche amounts to Euros 44,000 (this amount excludes bonds
already acquired by the Group in the amount Euros 206,000).
Synthetic securitizations
As at 31 December 2022, BCP has three operations in progress which form structures of synthetic securitization with
similar characteristics, with reference to credit portfolios granted by the Bank mainly to Small and Medium Enterprises
(SMEs).
Caravela SME No. 3
Caravela SME No.3, supports an operation started on 28 June 2013, based on a medium and long term loans portfolio of
current accounts and authorized overdrafts. The legal maturity date of the operation is 25 March of 2036 and the
operation amounts to Euros 276,209,000 as at 31 December 2022 (31 December 2021: Euros 395,657,000). The fair value
of the relative Credit Default Swap (CDS) is recorded as a positive amount of Euros 179,713,000 and the respective
registered cost in 2022 amounts to Euros 4,824,000.
Caravela SME No. 4
Caravela SME No.4 is a similar operation, initiated on 5 June 2014, which portfolio contains car, real estate and
equipment leasing. The legal maturity date is 21 September of 2043 and, as at 31 December 2022, the operation
amounts to Euros 506,117,000 (31 December 2021: Euros 627,053,000). The fair value of the relative CDS is recorded as
a positive amount of Euros 61.551.000 and the respective registered cost in 2022 amounts to Euros 2,026,000.
Caravela SME No.5
Caravela SME No.5, initiated on 20 December 2022, is supported by a portfolio of medium and long term loans, leasing
contract and commercial paper programmes. The legal maturity date is 26 September of 2035 and, as at 31 December
2022, the operation amounts to Euros 1,918,408,000. The fair value of the relative CDS is recorded as a negative
amount of Euros 76,000 and the respective registered cost in 2022 amounts to Euros 1,424,000.
In any of these operations, the Bank contracted a Credit Default Swap (CDS) from a Special Purpose Entity (SPE),
buying, this way, protection over the total referenced portfolio. As in all synthetic securitizations, under CDS, the risk
of the respective portfolios was divided in 3 tranches: senior, mezzanine and equity. In the case of both Caravela no. 3
and no. 4, the mezzanine and part of the equity (20%) were placed in the market through the issuance of Credit Linked
Notes (CLNs) by the above mentioned SPE which were subscribed by investors, while the Group retained the senior risk
and the remaining part of the equity (80%). In the case of Caravela, SME no. 5, only the full amount of the mezzanine
was placed in the market, while the Group retained the risk of the full amount of the senior and equity tranches. The
product of the CLNs issue was invested by the SPE in a deposit, which fully collateralizes the responsibilities in the
presence of its creditors including BCP, in accordance with the CDS.
These operations allowed the Bank to reduce the risk-weighted assets associated with the credit portfolios supporting
the operations, but the Bank did not transfer to third parties most of the rights and obligations arising from the credits
included in the respective portfolios, thus not meeting the derecognition criteria in the accounting policy presented in
note 1 C1.3.
Bank's Millennium securitization transactions
In March 2022, the Group's subsidiary Bank Millennium concluded a synthetic securitization transaction with the
participation of European Investment Bank (EIB) and European Investment Fund (EIF). The portfolio covered by the
transaction concerned receivables from small and medium-sized enterprises (SME) worth ca PLN 1.5 billion (Euros 320
million). Bank Millennium obtained the EIF guarantee for the senior tranche (ca PLN 1.2 billion [Euros 256 million]) and
the junior tranche (ca PLN 300 million [Euros 64 million]), which is unfunded credit protection within the meaning of
the CRR. The selected loan portfolio covered by the securitization remained in the Bank Millennium''s balance sheet.
On 23 December 2022, Bank Millennium settled another synthetic securitisation transaction executed on a portfolio of
corporate and SME receivables. The selected loan portfolio securitised remained on the bank's balance sheet. The risk
transfer was affected by a recognised credit protection instrument in the form of Credit Linked Notes (CLNs). The
issued bonds with a total nominal value of PLN 242.5 million (Euros 51.8 million) were acquired by a fund.
The transaction meets the requirements for the transfer of a material part of the risk, set out in the CRR Regulation
(Regulation of the European Parliament and of the Council No. 575/2013 of 26 June 2013 on prudential requirements
for credit institutions and investment firms).
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
During 2022, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2022
Financial assets at amortised cost - Loans and advances to customers -
Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,111,726)
2,111,726
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(258,614)
\u2014
258,614
\u2014
\u2014
Transfers from stage 2 to stage 1
1,946,027
(1,946,027)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(631,859)
631,859
\u2014
\u2014
Transfers from stage 3 to stage 1
26,176
\u2014
(26,176)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
174,249
(174,249)
\u2014
\u2014
Write-offs
(922)
(2,996)
(440,667)
(13,820)
(458,405)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
681,402
(104,910)
(764,669)
3,063
(185,114)
Gross amount at the end of the year
46,395,996
7,564,235
2,170,979
46,956
56,178,166
(Suisse))
(354,100)
\u2014
\u2014
\u2014
\u2014
(354,100)
Gross amount at the end of the year
46,113,653
7,964,052
2,686,267
57,713
\u2014
56,821,685
The analysis of this balance, by maturity,
is as follows:
(Thousands of euros)
2022
2021
Until 1 year
20,402
22,250
1 to 5 years
137,949
82,181
Over 5 years
33,485
114,296
191,836
218,727
Accrued costs recognised in Net interest income
(6,673)
(7,382)
185,163
211,345
", "dimensions": { "concept": "ifrs-full:DisclosureOfLeasesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-662": { "value": "Debt securities
The balance Debt securities is analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Portuguese issuers
Bonds
183,260
197,723
Commercial paper
1,256,557
1,074,715
Foreign issuers
Commercial paper
65,781
42,920
1,505,598
1,315,358
Overdue securities - over 90 days
40
40
1,505,638
1,315,398
Impairment
(4,676)
(7,059)
1,500,962
1,308,339
Debt securities held not associated with credit operations
Bonds issued by public entities (*)
Portuguese issuers
3,517,560
3,781,480
Foreign issuers
7,317,443
2,438,017
Bonds issued by other entities
Portuguese issuers
248,399
59,816
Foreign issuers
124,438
33,706
Treasury bills (Public Issuers and Central Banks)
\u00a0 Foreign issuers
336,343
592,581
11,544,183
6,905,600
Impairment
(9,563)
(8,743)
11,534,620
6,896,857
13,035,582
8,205,196
(*) Includes the negative amount of Euros 417,311,000 (31 December 2021: negative amount of Euros 17,349,000) related to
adjustments resulting from the application of fair value hedge accounting.
Under the terms of IFRS 9, the balance Debt securities held not associated with credit operations - Bonds issued by
public issuers, includes essentially a portfolio of securities to support Bank's ALM (Asset and Liability Management),
whose business model seeks to receive the respective income until maturity, that is, of a portfolio Held to Collect,
whose value as at 31 December 2022 amounts to Euros 9,248,707,000 (31 December 2021: Euros 5,409,085,000).
The balance Debt securities held not associated with credit operations - Bonds issued by other entities includes the
amount of Euros 69,805,000 (31 December 2021: Euros 39,519,000) related to public sector companies.
The analysis of the balance Debt securities before impairment, by maturity, as at 31 December 2022 is as follows:
(Thousands of euros)
2022
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese issuers
\u00a0 Bonds
\u2014
\u2014
13,480
169,780
\u2014
183,260
\u00a0 Commercial paper
860,395
396,162
\u2014
\u2014
40
1,256,597
Foreign issuers
\u00a0 Commercial paper
31,361
34,420
65,781
891,756
430,582
13,480
169,780
40
1,505,638
Debt securities held not associated
with credit operations
Public entities
\u00a0 Portuguese issuers
\u2014
\u2014
1,865,689
1,651,871
\u2014
3,517,560
\u00a0 Foreign issuers
50,410
212,482
970,601
6,083,950
\u2014
7,317,443
Other entities
\u00a0 Portuguese issuers
\u2014
\u2014
153,548
94,851
\u2014
248,399
\u00a0 Foreign issuers
\u2014
97,962
\u2014
26,476
\u2014
124,438
Treasury bills (Public Issuers and Central Banks)
\u00a0 Foreign issuers
237,209
99,134
\u2014
\u2014
336,343
287,619
409,578
2,989,838
7,857,148
\u2014
11,544,183
1,179,375
840,160
3,003,318
8,026,928
40
13,049,821
The analysis of the balance Debt securities before impairment, by maturity, as at 31 December 2021 is as follows:
(Thousands of euros)
2021
Up to
3 months
3 months to
1 year
1 year to
5 years
Over 5
years
Overdue
Total
Debt securities held associated
with credit operations
Portuguese issuers
Bonds
\u2014
\u2014
5,542
192,181
\u2014
197,723
Commercial paper
794,596
280,119
\u2014
\u2014
40
1,074,755
Foreign issuers
Commercial paper
6,426
36,494
\u2014
\u2014
\u2014
42,920
801,022
316,613
5,542
192,181
40
1,315,398
Debt securities held not associated
with credit operations
Public entities
Portuguese issuers
\u2014
99,898
883,952
2,797,630
\u2014
3,781,480
Foreign issuers
4,659
40,048
288,741
2,104,569
\u2014
2,438,017
Other entities
Portuguese issuers
\u2014
\u2014
13,691
46,125
\u2014
59,816
Foreign issuers
\u2014
\u2014
\u2014
33,706
\u2014
33,706
Treasury bills (Public Issuers and Central Banks)
Foreign issuers
143,081
449,500
\u2014
\u2014
\u2014
592,581
147,740
589,446
1,186,384
4,982,030
\u2014
6,905,600
948,762
906,059
1,191,926
5,174,211
40
8,220,998
The analysis of debt securities portfolio, net of impairment, by sector of activity, is analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Agriculture and forestry
2,496
4,733
Mining
46,403
13,736
Food, beverage and tobacco
79,448
63,815
Textiles
58,555
57,140
Wood and cork
19,630
12,103
Paper, printing and publishing
8,104
7,184
Chemicals
179,516
77,930
Machinery, equipment and basic metallurgical
65,973
48,453
Electricity and gas
165,676
172,325
Water
5,475
8,891
Construction
13,397
13,876
Retail business
20,507
13,601
Wholesale business
56,698
62,450
Restaurants and hotels
8,789
4,119
Transports
36,591
37,731
Telecommunications
9,706
6,559
Services
\u00a0 \u00a0 Financial intermediation
107,372
54,300
\u00a0 \u00a0 Real estate activities
50,845
40,150
\u00a0 \u00a0 Consulting, scientific and technical activities
473,231
541,187
\u00a0 \u00a0 Administrative and support services activities
12,269
10,706
\u00a0 \u00a0 Artistic, sports and recreational activities
10,406
9,868
\u00a0 \u00a0 Other services
4,095
4,562
Other international activities
65,780
42,920
1,500,962
1,308,339
Debt securities held not associated with credit operations
Electricity and Gas
88,873
6,573
Water
39,704
39,478
Services
Financial intermediation
460,781
626,287
Consulting, scientific and technical activities
119,297
13,511
708,655
685,849
Government and Public securities
10,825,965
6,211,008
11,534,620
6,896,857
13,035,582
8,205,196
The changes occurred in impairment of debt securities are analysed as follows:
(Thousands of euros)
2022
2021
Debt securities held associated with credit operations
Balance on 1 January
7,059
11,021
Charge for the year in net income interest
\u2014
47
Charge for the year (note 11)
8
244
Reversals for the year (note 11)
(2,393)
(2,533)
Loans charged-off
\u2014
(1,721)
Exchange rate differences
2
1
Balance at the end of the year
4,676
7,059
Debt securities held not associated with credit operations
Balance on 1 January
8,743
5,332
Transfers resulting from changes in the Group's structure
(Seguradora Internacional de Mo\u00e7ambique, S.A.)
\u2014
(15)
Other transfers
\u2014
(13)
Charge for the year (note 11)
3,329
4,874
Reversals for the year (note 11)
(2,779)
(1,826)
Exchange rate differences
270
391
Balance at the end of the year
9,563
8,743
Non subordinated debt securities issued
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Bonds
53,799
10,606
Covered bonds
\u2014
999,468
Medium term notes (MTN)
1,347,967
1,020,063
Securitisations
142,062
161,267
1,543,828
2,191,404
Interests to pay
(66,860)
(979)
Corrections to the value of liabilities subject to hedging operations
(12,523)
(13,564)
Deferred cost expenses
17,641
11,502
1,482,086
2,188,363
As described in note 48, in 2022 Banco Comercial Portugu\u00eas, S.A. issued senior preferred debt securities eligible for
MREL (Minimum Requirement for own funds and Eligible Liabilities), under its Euro Note Programme. The issue, in the
amount of Euros 350 million, will have a tenor of 3 years, with the option of early redemption by the Bank at the end of
year 2, an issue price of 100% and an annual interest rate of 8.5% during the first 2 years (corresponding to a spread of
5.547% over the 2-year mid-swap rate). The annual interest rate for the 3rd year was set at 3-month Euribor plus a
5.547% spread.
The characteristics of the bonds issued by the Group, as at 31 December 2022 are analysed as follows:
(Thousands of euros)
Issue
Issue
date
Maturity
date
Interest rate
Nominal
value
Book
value
Banco Comercial Portugu\u00eas:
BCP Cln Brisa Fev 2023 Epvm Sr 23
February, 2015
February, 2023
Fixed rate 2.65% - underlying
asset Brisa 022023
2,000
2,008
Bcp 6NC5 Senior Preferred EUR 500MN NG -
MTN 856
February, 2021
February, 2027
Fixed rate 1.125%year until
Feb-26 /after Euribor 3M +
Variable rate 1.55%
500,000
499,283
Bcp 1.75% Eur 500M 6.5Nc5.5 Social
Senior Preferred Notes - Mtn 857
October, 2021
April, 2028
Fixed rate 1.75% per year
until Apr-27/after + Euribor
3M+ 2%
500,000
443,148
BCP2022 MTN 859 BCP Senior Preferred
Notes OCT 2025
October, 2022
October, 2025
Fixed rate\u00a0 8.5% until
October 2024; after 5.547% +
Euribor 3M
350,000
353,112
BCP Finance Bank:
BCP Fin.Bank - EUR 10 M
March, 2004
March, 2024
Fixed rate 5.01%
300
311
Magellan Mortgages n.\u00ba 3:
Mbs Magellan Mortgages S 3 Cl.A
June, 2005
May, 2058
Euribor 3M + 0.26%
140,215
130,439
Mbs Magellan Mortgages S.3 Cl.B
June, 2005
May, 2058
Euribor 3M + 0.38%
724
673
Mbs Magellan Mortgages S. 3 Cl.C
June, 2005
May, 2058
Euribor 3M + 0.58%
1,124
1,046
Bank Millennium:
Bank Millennium - BMCN_012040
December, 2022
January, 2040
Wibor 3m 7.05% + 1.39% =
20.95%
51,799
52,066
1,482,086
This balance as at 31 December 2022 is analysed by the remaining period, as follows:
(Thousands of euros)
2022
Up to 3
months
3 months to 6
months
6 months to 1
year
1 year to 5
years
Over
5 years
Total
Bonds
2,008
\u2014
\u2014
\u2014
52,066
54,074
Medium term notes (MTNs)
\u2014
\u2014
\u2014
852,706
443,148
1,295,854
Securitisations
\u2014
\u2014
\u2014
\u2014
132,158
132,158
2,008
\u2014
\u2014
852,706
627,372
1,482,086
", "dimensions": { "concept": "ifrs-full:DisclosureOfDebtSecuritiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-663": { "value": "Financial assets at fair value through profit or loss and financial assets at fair
value through other comprehensive income
The balances Financial assets at fair value through profit or loss and Financial assets at fair value through other
comprehensive income are analysed as follows:
(Thousands of euros)
2022
2021
Financial assets at fair value through profit or loss
Financial assets held for trading
Debt instruments
338,813
452,105
Equity instruments
51,540
48,879
Trading derivatives
376,244
430,501
766,597
931,485
Financial assets not held for trading mandatorily at fair value through profit or loss
Loans and advances to customers at fair value
20,929
79,189
Debt instruments
504,200
881,556
Equity instruments
27,550
30,193
552,679
990,938
Financial assets at fair value through other comprehensive income
Debt instruments
7,434,152
12,856,165
Equity instruments
27,401
34,823
7,461,553
12,890,988
8,780,829
14,813,411
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2022, is analysed as follows:
(Thousands of euros)
2022
At fair value through profit or loss
Held for trading
Not held for trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
21,450
\u2014
2,448,636
2,470,086
Foreign issuers
8,353
\u2014
2,916,098
2,924,451
Bonds issued by other entities
Portuguese issuers
\u2014
51
542,765
542,816
Foreign issuers
74
\u2014
897,146
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
308,936
\u2014
993
309,929
Foreign issuers
\u2014
\u2014
628,514
628,514
Shares of foreign companies (a)
\u2014
19,387
\u2014
19,387
Investment fund units (b)
\u2014
484,762
\u2014
484,762
338,813
504,200
7,434,152
8,277,165
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
18,811
18,811
Foreign companies
24
27,550
8,590
36,164
Other securities
51,516
\u2014
\u2014
51,516
51,540
27,550
27,401
106,491
Trading derivatives
376,244
\u2014
\u2014
376,244
766,597
531,750
7,461,553
8,759,900
Level 1
389,954
\u2014
6,489,282
6,879,236
Level 2
81,347
\u2014
322,514
403,861
Level 3
295,296
531,750
649,757
1,476,803
(a)Under IFRS 9 these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9 these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred in
IFRS 13, financial instruments are measured according to the levels of valuation described in note 49.
As at 31 December 2022, the balances Financial assets held for trading include bonds issued with different levels of
subordination associated with the traditional securitization transactions Magellan Mortgages No. 4, referred in note 1 D,
in the amount of Euros 74,000 (31 December 2021: Euros 87,000).
As at 31 December 2022, the balance Financial assets at fair value through other comprehensive income - Bonds issued
by other entities - Portuguese issuers includes the amount of Euros 25,505,000 (31 December 2021: Euros 165,967,000)
related to public sector companies.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
At fair value through profit or loss
Held for trading
Not held for
trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
10,317
\u2014
3,798,776
3,809,093
Foreign issuers
18,857
\u2014
6,736,241
6,755,098
Bonds issued by other entities
Portuguese issuers
1,716
16,734
742,554
761,004
Foreign issuers
1,073
\u2014
1,011,740
1,012,813
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
420,142
\u2014
6,027
426,169
Foreign issuers
\u2014
\u2014
560,827
560,827
Shares of foreign companies (a)
\u2014
35,185
\u2014
35,185
Investment fund units (b)
\u2014
829,637
\u2014
829,637
452,105
881,556
12,856,165
14,189,826
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
17,275
17,275
Foreign companies
32
30,193
17,548
47,773
Other securities
48,847
\u2014
\u2014
48,847
48,879
30,193
34,823
113,895
Trading derivatives
430,501
\u2014
\u2014
430,501
931,485
911,749
12,890,988
14,734,222
Level 1
499,147
\u2014
12,463,415
12,962,562
Level 2
169,181
\u2014
303,629
472,810
Level 3
263,157
911,749
123,944
1,298,850
(a)Under IFRS 9, these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9, these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
On balance sheet, the changes occurred during the 2022 and 2021, for impairment of financial assets at fair value
through other comprehensive, are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
1,092
1,097
Transfers to fair value changes (note 43)
5,024
(4,626)
Impairment through profit and loss (note 12)
545
4,784
Reversals through profit and loss (note 12)
(5,569)
(158)
Exchange rate differences
(25)
(5)
Balance at the end of the year
1,067
1,092
As at 31 December 2022, the accumulated impairment related to credit risk associated with the financial assets at fair
value through other comprehensive income amounts to Euros 5,270,000 and is recognised against Fair value reserves (31
December 2021: Euros 18,496,000).
The portfolio of financial assets at fair value through other comprehensive income, as at 31 December 2022, is analysed
as follows:
(Thousands of euros)
2022
Amortised cost
(a)
Fair value
hedge
adjustments
(note 43)
Fair value
adjustments
(note 43)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,708,319
(169,699)
(89,984)
2,448,636
Foreign issuers
3,007,189
\u2014
(91,091)
2,916,098
Bonds issued by other entities
Portuguese issuers
566,480
(19,099)
(4,616)
542,765
Foreign issuers
1,023,516
(83,632)
(42,738)
897,146
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
994
\u2014
(1)
993
Foreign issuers
628,509
\u2014
5
628,514
7,935,007
(272,430)
(228,425)
7,434,152
Equity instruments
Shares
Portuguese companies
33,448
\u2014
(14,637)
18,811
Foreign companies
19,799
\u2014
(11,209)
8,590
53,247
\u2014
(25,846)
27,401
7,988,254
(272,430)
(254,271)
7,461,553
(a)Include interest accrued and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of financial assets at fair value through other comprehensive income, as at 31 December 2021, is analysed
as follows:
(Thousands of euros)
2021
Amortised cost
(a)
Fair value hedge
adjustments
(note 43)
Fair value
adjustments
(note 43)
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
3,780,832
(23,435)
41,379
3,798,776
Foreign issuers
6,811,530
(21,427)
(53,862)
6,736,241
Bonds issued by other entities
Portuguese issuers
727,477
4,799
10,278
742,554
Foreign issuers
1,001,729
(1,051)
11,062
1,011,740
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
6,026
\u2014
1
6,027
Foreign issuers
560,989
\u2014
(162)
560,827
12,888,583
(41,114)
8,696
12,856,165
Equity instruments
Shares
Portuguese companies
37,069
\u2014
(19,794)
17,275
Foreign companies
27,996
\u2014
(10,448)
17,548
65,065
\u2014
(30,242)
34,823
12,953,648
(41,114)
(21,546)
12,890,988
(a)Include interest accrued and accumulated impairment for debt securities classified as financial assets at fair value through other
comprehensive income, as provided by IFRS 9, and according to the requirements defined in the accounting policy 1 C1.5.1.2.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31 December 2022, by
valuation levels, is analysed as follows:
(Thousands of euros)
2022
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,336,787
133,299
\u2014
2,470,086
Foreign issuers
2,908,924
\u2014
15,527
2,924,451
Bonds issued by other entities
Portuguese issuers
416,374
57,212
69,230
542,816
Foreign issuers
853,605
43,615
\u2014
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
309,929
\u2014
\u2014
309,929
Foreign issuers
\u2014
88,462
540,052
628,514
Shares of Foreign companies (**)
\u2014
\u2014
19,387
19,387
Investment fund units
\u2014
\u2014
484,762
484,762
6,825,619
322,588
1,128,958
8,277,165
Equity instruments
Shares
Portuguese companies
2,402
\u2014
16,409
18,811
Foreign companies
24
\u2014
36,140
36,164
Other securities
51,191
\u2014
325
51,516
53,617
\u2014
52,874
106,491
Trading derivatives
\u2014
81,273
294,971
376,244
6,879,236
403,861
1,476,803
8,759,900
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances at fair value and
trading derivatives) and Financial assets at fair value through other comprehensive, by residual maturity, as at 31
December 2021, is as follows:
(Thousands of euros)
2021
Up to 3
months
3 months to 1
year
1 year to 5
years
Over
5 years
Undetermined
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
\u2014
32,301
1,370,717
2,406,075
\u2014
3,809,093
Foreign issuers
\u2014
1,067,698
4,285,163
1,402,237
\u2014
6,755,098
Bonds issued by other entities
Portuguese issuers
40,017
203
588,298
132,486
\u2014
761,004
Foreign issuers
\u2014
\u2014
389,622
623,191
\u2014
1,012,813
Treasury bills (Public Issuers and
Central Banks)
Portuguese issuers
270,511
155,658
\u2014
\u2014
\u2014
426,169
Foreign issuers
20,411
540,416
\u2014
\u2014
\u2014
560,827
Shares of Foreign companies
\u2014
\u2014
\u2014
\u2014
35,185
35,185
Investment fund units
\u2014
\u2014
284,865
539,067
5,705
829,637
330,939
1,796,276
6,918,665
5,103,056
40,890
14,189,826
Equity instruments
Shares
Portuguese companies
17,275
17,275
Foreign companies
47,773
47,773
Other securities
48,847
48,847
\u2014
\u2014
\u2014
\u2014
113,895
113,895
330,939
1,796,276
6,918,665
5,103,056
154,785
14,303,721
The balance Financial assets not held for trading mandatorily at fair value through profit or loss - Loans to customers at
fair value is analysed as follows:
(Thousands of euros)
2022
2021
Unsecured loans
17,217
74,248
Overdue loans - less than 90 days
554
1,626
Overdue loans - Over 90 days
3,158
3,315
20,929
79,189
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2022, is as follows:
(Thousands of euros)
2022
Bonds and
Treasury bills
Shares
Other Financial
Assets
Total
Mining
\u2014
5
\u2014
5
Paper, printing and publishing
45,562
2
\u2014
45,564
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
6
\u2014
6
Electricity and gas
2,302
\u2014
\u2014
2,302
Water
44,627
\u2014
\u2014
44,627
Construction
9,460
2
20,159
29,621
Retail business
4,934
2
\u2014
4,936
Wholesale business
20,503
260
\u2014
20,763
Restaurants and hotels
6,456
1,401
\u2014
7,857
Transports
29,491
\u2014
\u2014
29,491
Telecommunications
38,869
4,401
\u2014
43,270
Services
\u00a0 Financial intermediation (*)
1,533,154
54,477
512,408
2,100,039
\u00a0 Consulting, scientific and technical activities
303,036
103
\u2014
303,139
\u00a0 Administrative and support services activities
26,691
8,629
\u2014
35,320
\u00a0 Public sector
\u2014
\u2014
325
325
\u00a0 Other services
3,465
5,054
3,386
11,905
Other international activities
\u2014
18
\u2014
18
2,068,550
74,362
536,278
2,679,190
Government and Public securities
5,704,466
\u2014
\u2014
5,704,466
7,773,016
74,362
536,278
8,383,656
(*) The balance Other financial assets includes restructuring funds in the amount of Euros 410,571,000, which are classified in the
sector of activity Services - Financial intermediation but the core segment is disclosed in note 47.
The analysis of Financial assets at fair value through profit or loss (excluding loans and advances to customers at fair
value and trading derivatives) and Financial assets at fair value through other comprehensive income, by sector of
activity, as at 31 December 2021, is as follows:
(Thousands of euros)
2021
Bonds and Treasury
bills
Shares
Other Financial
Assets
Total
Fisheries
1,513
\u2014
\u2014
1,513
Mining
\u2014
6
\u2014
6
Paper, printing and publishing
47,865
1
\u2014
47,866
Chemicals
\u2014
2
\u2014
2
Machinery, equipment and basic metallurgical
\u2014
7
\u2014
7
Electricity and gas
43,805
\u2014
\u2014
43,805
Water
10,241
\u2014
\u2014
10,241
Construction
21,155
2
20,423
41,580
Retail business
42,322
3
\u2014
42,325
Wholesale business
39,161
8,087
\u2014
47,248
Restaurants and hotels
\u2014
1,330
\u2014
1,330
Transports
77,463
\u2014
\u2014
77,463
Telecommunications
42,854
4,285
\u2014
47,139
Services
Financial intermediation (*)
1,016,537
72,308
839,714
1,928,559
Real estate activities
\u2014
\u2014
13,588
13,588
Consulting, scientific and technical activities
455,409
103
\u2014
455,512
Administrative and support services activities
12,220
7,981
\u2014
20,201
Public sector
\u2014
\u2014
136
136
Artistic, sports and recreational activities
16,683
\u2014
\u2014
16,683
Other services
4,893
6,118
4,623
15,634
1,832,121
100,233
878,484
2,810,838
Government and Public securities
11,492,883
\u2014
\u2014
11,492,883
13,325,004
100,233
878,484
14,303,721
The average of the reference rates of the yield curve obtained from the market prices of the different currencies used
in the determination of the fair value of the\u00a0 issues is analysed as follows:
2022
2021
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
9.33%
\u2014
4.8%
\u2014
Senior
0.19%
\u2014
2.33%
\u2014
Covered bonds
\u2014
\u2014
-0.08%
\u2014
Placed in retail
Senior and collateralised
3.37%
6.19%
0.12%
3.63%
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2022
2021
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.00%
4.45%
3.55%
6.76%
-0.59%
0.11%
0.19%
1.99%
7 days
2.00%
4.47%
3.58%
6.76%
-0.59%
0.14%
0.21%
1.99%
1 month
2.04%
4.57%
3.67%
6.83%
-0.56%
0.14%
0.25%
2.13%
2 months
2.13%
4.66%
3.80%
6.87%
-0.56%
0.16%
0.32%
2.28%
3 months
2.25%
4.77%
3.91%
6.92%
-0.56%
0.21%
0.38%
2.44%
6 months
2.73%
5.07%
4.32%
7.04%
-0.54%
0.33%
0.56%
2.74%
9 months
3.11%
5.28%
4.65%
7.09%
-0.51%
0.47%
0.76%
2.89%
1 year
3.26%
5.11%
4.87%
7.35%
-0.49%
0.52%
0.89%
3.71%
2 years
3.39%
4.69%
4.69%
6.97%
-0.30%
0.92%
1.20%
3.93%
3 years
3.31%
4.33%
4.56%
6.53%
-0.15%
1.15%
1.30%
3.88%
5 years
3.23%
4.02%
4.33%
6.20%
0.02%
1.34%
1.29%
3.74%
7 years
3.19%
3.89%
4.14%
6.13%
0.13%
1.45%
1.24%
3.63%
10 years
3.21%
3.82%
3.99%
6.20%
0.30%
1.56%
1.21%
3.54%
15 years
3.14%
3.79%
3.91%
6.45%
0.49%
1.68%
1.18%
3.74%
20 years
2.93%
3.72%
3.84%
6.49%
0.55%
1.74%
1.15%
3.86%
30 years
2.54%
3.48%
3.70%
6.49%
0.48%
1.72%
1.10%
3.86%
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2022, is analysed as follows:
(Thousands of euros)
2022
At fair value through profit or loss
Held for trading
Not held for trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
21,450
\u2014
2,448,636
2,470,086
Foreign issuers
8,353
\u2014
2,916,098
2,924,451
Bonds issued by other entities
Portuguese issuers
\u2014
51
542,765
542,816
Foreign issuers
74
\u2014
897,146
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
308,936
\u2014
993
309,929
Foreign issuers
\u2014
\u2014
628,514
628,514
Shares of foreign companies (a)
\u2014
19,387
\u2014
19,387
Investment fund units (b)
\u2014
484,762
\u2014
484,762
338,813
504,200
7,434,152
8,277,165
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
18,811
18,811
Foreign companies
24
27,550
8,590
36,164
Other securities
51,516
\u2014
\u2014
51,516
51,540
27,550
27,401
106,491
Trading derivatives
376,244
\u2014
\u2014
376,244
766,597
531,750
7,461,553
8,759,900
Level 1
389,954
\u2014
6,489,282
6,879,236
Level 2
81,347
\u2014
322,514
403,861
Level 3
295,296
531,750
649,757
1,476,803
(a)Under IFRS 9 these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9 these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolios are recorded at fair value in accordance with the accounting policy described in note 1 C. As referred in
IFRS 13, financial instruments are measured according to the levels of valuation described in note 49.
As at 31 December 2022, the balances Financial assets held for trading include bonds issued with different levels of
subordination associated with the traditional securitization transactions Magellan Mortgages No. 4, referred in note 1 D,
in the amount of Euros 74,000 (31 December 2021: Euros 87,000).
As at 31 December 2022, the balance Financial assets at fair value through other comprehensive income - Bonds issued
by other entities - Portuguese issuers includes the amount of Euros 25,505,000 (31 December 2021: Euros 165,967,000)
related to public sector companies.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive income, net of impairment, by type of asset, as
at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
At fair value through profit or loss
Held for trading
Not held for
trading
mandatorily at fair
value through
profit or loss
At fair value
through other
comprehensive
income
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
10,317
\u2014
3,798,776
3,809,093
Foreign issuers
18,857
\u2014
6,736,241
6,755,098
Bonds issued by other entities
Portuguese issuers
1,716
16,734
742,554
761,004
Foreign issuers
1,073
\u2014
1,011,740
1,012,813
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
420,142
\u2014
6,027
426,169
Foreign issuers
\u2014
\u2014
560,827
560,827
Shares of foreign companies (a)
\u2014
35,185
\u2014
35,185
Investment fund units (b)
\u2014
829,637
\u2014
829,637
452,105
881,556
12,856,165
14,189,826
Equity instruments
Shares
Portuguese companies
\u2014
\u2014
17,275
17,275
Foreign companies
32
30,193
17,548
47,773
Other securities
48,847
\u2014
\u2014
48,847
48,879
30,193
34,823
113,895
Trading derivatives
430,501
\u2014
\u2014
430,501
931,485
911,749
12,890,988
14,734,222
Level 1
499,147
\u2014
12,463,415
12,962,562
Level 2
169,181
\u2014
303,629
472,810
Level 3
263,157
911,749
123,944
1,298,850
(a)Under IFRS 9, these shares were considered as debt instruments because they do not fall within the definition of SPPI.
(b)Under IFRS 9, these participation units were considered as debt instruments because they do not fall within the definition of
equity instruments.
The portfolio of Financial assets at fair value through profit or loss (excluding Loans and advances to customers at fair
value) and Financial assets at fair value through other comprehensive, net of impairment, as at 31 December 2022, by
valuation levels, is analysed as follows:
(Thousands of euros)
2022
Level 1
Level 2
Level 3
Total
Debt instruments
Bonds issued by public entities
Portuguese issuers
2,336,787
133,299
\u2014
2,470,086
Foreign issuers
2,908,924
\u2014
15,527
2,924,451
Bonds issued by other entities
Portuguese issuers
416,374
57,212
69,230
542,816
Foreign issuers
853,605
43,615
\u2014
897,220
Treasury bills (Public Issuers and Central Banks)
Portuguese issuers
309,929
\u2014
\u2014
309,929
Foreign issuers
\u2014
88,462
540,052
628,514
Shares of Foreign companies (**)
\u2014
\u2014
19,387
19,387
Investment fund units
\u2014
\u2014
484,762
484,762
6,825,619
322,588
1,128,958
8,277,165
Equity instruments
Shares
Portuguese companies
2,402
\u2014
16,409
18,811
Foreign companies
24
\u2014
36,140
36,164
Other securities
51,191
\u2014
325
51,516
53,617
\u2014
52,874
106,491
Trading derivatives
\u2014
81,273
294,971
376,244
6,879,236
403,861
1,476,803
8,759,900
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-665": { "value": "Investments in associated companies
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Portuguese credit institutions
49,228
40,581
Foreign credit institutions
170,045
165,393
Other Portuguese companies
115,275
308,937
Other foreign companies
30,432
25,695
364,980
540,606
Impairment
(66,263)
(78,268)
298,717
462,338
These investments correspond to unquoted companies. According to the accounting policy described in note 1 B, these
investments are measured at the equity method.
The balance Investments in associated companies, as at 31 December 2021, is analysed as follows:
(Thousands of euros)
2021
Ownership on
equity
Goodwill
Impairment of
investments in
associated
companies
Total
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.
261,446
\u2014
\u2014
261,446
Banco Millennium Atl\u00e2ntico, S.A.
65,716
54,744
(60,257)
60,203
Banque BCP, S.A.S.
44,933
\u2014
\u2014
44,933
SIBS, S.G.P.S, S.A.
47,142
\u2014
\u2014
47,142
Fidelidade Mo\u00e7ambique - Companhia de Seguros S.A.
7,684
\u2014
\u2014
7,684
Unicre - Institui\u00e7\u00e3o Financeira de Cr\u00e9dito, S.A.
33,146
7,435
\u2014
40,581
Webspectator Corporation
\u2014
18,011
(18,011)
\u2014
Others
349
\u2014
\u2014
349
460,416
80,190
(78,268)
462,338
The Group's companies included in the consolidation perimeter are presented in note 59, as well as the main indicators
of the most relevant ones.
The movements occurred in Impairment of investments in associated companies are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
78,268
52,559
Transfers from Other provisions (Banco Millennium Atl\u00e2ntico, S.A.) (note 39)
5,000
22,300
Sale Cold River's Homestead, S.A.
\u2014
(4,557)
Impairment charge for the year (note 13)
1,435
\u2014
Impairment\u00a0 write-off\u00a0 (Banco Millennium Atl\u00e2ntico, S.A.)
(16,787)
\u2014
Exchange rate differences
(1,653)
7,966
Balance at the end of the year
66,263
78,268
8,814
13,962
Goodwill associated with investment in BMA
3,419
4,373
Impairment of investments in associated companies (note 43)
1,653
(7,966)
Investment held at the end of the year
70,928
60,203
(*) Includes adjustments according to BCP GAAP.
The following table presents the financial statements of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A.,
prepared in accordance with IFRS, modified by the consolidation adjustments:
(Thousands of euros)
2022
2021
Net profit for the year
74,425
69,900
Comprehensive income
(222,939)
(11,690)
Total comprehensive income attributable to Shareholders of the associated company
(148,514)
58,210
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
6,822
8,096
Attributable to Shareholders of the associated company adjusted to BCP GAAP
(141,692)
66,306
Attributable to the BCP Group
(69,429)
32,490
Balance sheet
Financial assets
8,417,704
10,263,904
Non-financial assets
459,055
429,543
Financial liabilities
(8,405,919)
(9,810,182)
Non-financial liabilities
(69,123)
(62,344)
Total equity
401,717
820,921
Attributable to non-controlling interests
10,929
11,718
Attributable to Shareholders of the associated companies
390,788
809,203
Adjustments of intra-group transactions (reverse of the VOBA annual amortisation (*)
362,086
355,263
Attributable to Shareholders of the associated company adjusted to BCP GAAP
752,874
1,164,466
Attributable to the BCP Group
368,908
570,588
Reverse of the initial gain in 2004 allocated to the BCP Group
(309,142)
(309,142)
Attributable to the BCP Group adjusted of consolidation items
59,766
261,446
(*) VOBA corresponds to the estimated current value of the future cash flows of the contracts in force at the date of acquisition. The
value of the acquired business (VOBA) is recognised in the consolidated accounts of Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. as intangible assets and is amortised over the period of recognition of the income associated with the policies acquired.
The Group owns 49% of Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., being accounted for under the equity
method, as Investments in associated companies.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A. is dedicated to the management of life insurance and pension
funds.
On 1 January 2023 Millenniumbcp Ageas made the simultaneous adoption of IFRS9 - Financial Instruments and IFRS17 -
Insurance Contracts. It opted for the possibility given to Insurance Companies to defer the application of IFRS9, since
the combined implementation with IFRS17 would minimize the distortion of results.
IFRS 17 replaces IFRS 4 - \"Insurance Contracts\" and is applicable to all entities that issue insurance contracts,
reinsurance contracts and investment contracts with discretionary participation features if they are also issuers of
insurance contracts.
In accordance with IFRS 17, at initial recognition, Millenniumbcp Ageas Grupo Segurador has identified the contracts
that are subject to similar risks and that are managed together, being aggregated in portfolios. For measurement
purposes, further divides portfolios of insurance contracts into groups of insurance contracts. A group of insurance
contracts is determined by first dividing the portfolio of insurance contracts into annual cohorts. Each annual cohort is
then further divided in the following groups: i) group of contracts that are onerous at initial recognition; ii) group of
contracts that at initial recognition have no significant possibility of becoming onerous subsequently; and iii) a group of
the remaining contracts in the portfolio.
Insurance contracts are now measured using estimates and updated assumptions that reflect the timing of cash flows
discounted and any uncertainty related to insurance contracts. Income is now recognized as it provides insurance
services (rather than when it receives premiums) provide information on the insurance contract earnings that it expects
to recognize in the future.
In the measurement of insurance contracts, Millenniumbcp Ageas Grupo Segurador has opted for two measurement
methods: i) Premium allocation approach (\"PAA\") for contracts with duration equal to or less than one year and ii)
General measurement model measurement model (\"GMM\") for the remaining contracts.
Initial application of IFRS 17 and IFRS 9 requires comparative information. Therefore, Millenniumbcp Ageas Grupo
Segurador made the transition exercise on 1 January 2022. The estimated impacts of the transition to IFRS 17 represent
a reduction in the Equity of Millenniumbcp Ageas Grupo Segurador, partially offset by the positive impact resulting from
the adoption of IFRS9.
IFRS 17 is retrospective with exemptions provided for the transition date. These exemptions are related to the
impracticability and complexity involved e.g. in calculating the liability, the current service margin (\"CSM\"), loss
component, or other comprehensive income (\"OCI option\") at transition date. When impracticable, the standard
provides for the use of the Modified Retrospective Approach or the Fair Value Approach. Millenniumbcp Ageas Grupo
Segurador, for contracts prior to 2018 adopted the fair value and for contracts after 2018 the full retrospective
approach.
Millenniumbcp Ageas Grupo Segurador, S.G.P.S., S.A., ('Millenniumbcp Ageas' or 'Group'), is owned by Ageas Insurance
International, N.V. (51%), through Ageas Portugal Holdings S.G.P.S., S.A. (51%), and by Banco Comercial Portugu\u00eas, S.A.
(49%).
Some indicators of the main subsidiaries and associated companies are analysed as follows:
2022
2021
Subsidiaries and associated companies
Total
Assets
Total
Equity
Net income
for the year
Total
Assets
Total
Equity
Net income
for the year
Banco ActivoBank, S.A.
3,271,355
213,017
19,142
2,786,258
194,491
13,536
Bank Millennium, S.A. (1)
23,697,447
1,173,617
(216,683)
22,669,323
1,461,037
(291,927)
BIM - Banco Internacional de Mo\u00e7ambique, S.A. (1)
2,824,409
521,192
106,030
2,526,707
558,904
95,566
BCP International B.V.
524,966
524,627
87,434
976,464
976,192
(361)
BCP Finance Bank, Ltd.
520,294
519,976
4,996
520,002
519,686
4,227
BCP \u00c1frica, S.G.P.S., Lda.
561,713
560,269
60,975
500,105
499,294
(26,955)
Millennium bcp Participa\u00e7\u00f5es, S.G.P.S., Sociedade
Unipessoal, Lda.
179,441
178,297
11,406
177,258
177,244
10,353
Interfundos - Sociedade Gestora de Organismos de\u00a0
Investimento Coletivo, S.A.
9,731
8,113
2,084
9,228
7,722
2,531
Millenniumbcp Ageas Grupo Segurador, S.G.P.S.,
S.A. (1) (2)
8,876,759
401,717
74,425
10,693,447
820,921
69,900
Banco Millennium Atl\u00e2ntico, S.A. (3)
2,910,070
292,893
10,693
2,712,137
296,392
11,563
Banque BCP, S.A.S.
4,944,774
268,097
23,499
4,477,971
236,548
20,447
1) Consolidated accounts.
2) Includes VOBA annual amortisation. The value of the acquired business (VOBA) corresponds to the estimated current value of the
future cash flows of the contracts in force at the date of acquisition and it is recognised in the consolidated accounts of Millenniumbcp
Ageas Grupo Segurador, S.G.P.S., S.A. as intangible assets and is amortised over the period of recognition of the income associated
with the policies acquired.
3) These indicators correspond to the statutory financial statements that do not include the effects of applying IAS 29.
", "dimensions": { "concept": "ifrs-full:DisclosureOfInterestsInOtherEntitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-666": { "value": "Non-current assets held for sale
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Gross value
Impairment
Net value
Gross value
Impairment
Net value
Real estate
Assets arising from recovered loans
326,577
(90,699)
235,878
630,082
(127,218)
502,864
Assets belong to investments funds and
real estate companies
266,544
(46,497)
220,047
279,071
(50,481)
228,590
Assets for own use (closed branches)
20,556
(6,626)
13,930
22,800
(5,939)
16,861
Equipment and other
22,117
(5,743)
16,374
24,421
(7,076)
17,345
Other assets
12,806
\u2014
12,806
14,854
\u2014
14,854
648,600
(149,565)
499,035
971,228
(190,714)
780,514
", "dimensions": { "concept": "ifrs-full:DisclosureOfInvestmentPropertyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-668": { "value": "Other tangible assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Real estate
670,000
708,803
Equipment
Computer equipment
334,864
337,457
Security equipment
67,687
67,542
Interior installations
149,986
148,532
Machinery
47,283
49,455
Furniture
84,516
84,923
Motor vehicles
32,529
29,703
Other equipment
28,224
30,711
Right of use
Real estate
366,363
352,346
Vehicles and equipment
431
505
Work in progress
21,279
20,656
Other tangible assets
39
38
1,803,201
1,830,671
Accumulated depreciation
Relative to the current year (note 9)
(98,916)
(98,972)
Relative to the previous years
(1,129,588)
(1,130,978)
(1,228,504)
(1,229,950)
574,697
600,721
The balance Right-of-use essentially corresponds to real estate (branches and central buildings) and to a residual
number of vehicles, which are amortized according to the lease term of each contract, as described in the accounting
policy 1 H.
The changes occurred in Other tangible assets during 2022 are analysed as follows:
(Thousands of euros)
2022
Balance on 1
January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Real estate
708,803
2,442
(37,606)
(6,690)
3,051
670,000
Equipment:
Computer equipment
337,457
15,238
(31,600)
12,186
1,583
334,864
Security equipment
67,542
844
(1,372)
382
291
67,687
Interior installations
148,532
1,339
(1,880)
1,198
797
149,986
Machinery
49,455
611
(2,068)
(380)
(335)
47,283
Furniture
84,923
440
(3,583)
2,371
365
84,516
Motor vehicles
29,703
7,033
(4,869)
306
356
32,529
Other equipment
30,711
180
(2,223)
107
(551)
28,224
Right of use
Real estate
352,346
35,010
(20,114)
(8)
(871)
366,363
Vehicles and equipment
505
\u2014
(65)
\u2014
(9)
431
Work in progress
20,656
24,408
(1,133)
(22,808)
156
21,279
Other tangible assets
38
\u2014
\u2014
\u2014
1
39
1,830,671
87,545
(106,513)
(13,336)
4,834
1,803,201
Accumulated depreciation
Real estate
(428,656)
(14,917)
31,982
5,702
(176)
(406,065)
Equipment:
Computer equipment
(300,560)
(16,375)
31,432
(116)
(1,359)
(286,978)
Security equipment
(63,723)
(862)
1,337
152
(254)
(63,350)
Interior installations
(131,897)
(3,007)
1,828
446
(524)
(133,154)
Machinery
(41,681)
(1,535)
1,997
1,427
268
(39,524)
Furniture
(78,344)
(2,717)
3,543
(1,232)
(257)
(79,007)
Motor vehicles
(17,743)
(4,636)
4,189
(53)
(214)
(18,457)
Other equipment
(23,811)
(1,498)
2,222
12
415
(22,660)
Right of use
Real estate
(142,996)
(53,365)
17,094
1
427
(178,839)
Vehicles and equipment
(501)
(4)
65
\u2014
9
(431)
Other tangible assets
(38)
\u2014
\u2014
\u2014
(1)
(39)
(1,229,950)
(98,916)
95,689
6,339
(1,666)
(1,228,504)
600,721
(11,371)
(10,824)
(6,997)
3,168
574,697
The changes occurred in Other tangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on 1
January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Real estate
725,639
990
(29,510)
(2,200)
13,884
708,803
Equipment:
Computer equipment
330,853
7,011
(12,828)
5,915
6,506
337,457
Security equipment
69,812
403
(3,413)
(136)
876
67,542
Interior installations
144,693
1,275
(1,243)
1,446
2,361
148,532
Machinery
49,452
369
(1,670)
984
320
49,455
Furniture
84,962
448
(2,097)
534
1,076
84,923
Motor vehicles
29,448
4,375
(6,087)
432
1,535
29,703
Other equipment
30,886
18
(1,168)
1,045
(70)
30,711
Right of use
Real estate
334,608
35,024
(19,979)
\u2014
2,693
352,346
Vehicles and equipment
929
14
(436)
\u2014
(2)
505
Work in progress
18,021
15,792
(128)
(13,860)
831
20,656
Other tangible assets
248
2
(252)
\u2014
40
38
1,819,551
65,721
(78,811)
(5,840)
30,050
1,830,671
Accumulated depreciation
Real estate
(431,312)
(14,945)
18,823
2,589
(3,811)
(428,656)
Equipment:
Computer equipment
(291,414)
(16,606)
12,505
(34)
(5,011)
(300,560)
Security equipment
(65,662)
(864)
3,413
136
(746)
(63,723)
Interior installations
(128,864)
(2,726)
1,041
155
(1,503)
(131,897)
Machinery
(41,333)
(1,294)
1,425
(253)
(226)
(41,681)
Furniture
(77,162)
(2,781)
1,958
376
(735)
(78,344)
Motor vehicles
(17,215)
(4,353)
4,850
(20)
(1,005)
(17,743)
Other equipment
(23,586)
(1,497)
1,073
179
20
(23,811)
Right of use
Real estate
(101,475)
(53,799)
13,302
\u2014
(1,024)
(142,996)
Vehicles and equipment
(668)
(107)
272
\u2014
2
(501)
Other tangible assets
(35)
\u2014
1
\u2014
(4)
(38)
(1,178,726)
(98,972)
58,663
3,128
(14,043)
(1,229,950)
640,825
(33,251)
(20,148)
(2,712)
16,007
600,721
", "dimensions": { "concept": "ifrs-full:DisclosureOfPropertyPlantAndEquipmentExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-669": { "value": "Goodwill and intangible assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
102,655
104,843
Euro Bank, S.A. (Poland)
41,038
41,913
Others
10,182
12,675
153,875
159,431
Impairment
Bank Millennium, S.A. (Poland)
(102,655)
\u2014
Others
(9,880)
(11,931)
(112,535)
(11,931)
41,340
147,500
Intangible assets
Software
277,205
234,192
Other intangible assets
73,607
70,823
350,812
305,015
Accumulated amortisation
Charge for the year (note 9)
(40,334)
(38,184)
Charge for the previous years
(169,131)
(158,118)
(209,465)
(196,302)
141,347
108,713
182,687
256,213
According to the accounting policy described in note 1 B, the recoverable amount of the Goodwill is annually assessed
in the second half of each year or whenever there are indications of eventual loss of value. In accordance with IAS 36
the recoverable amount of goodwill resulting from the consolidation of the subsidiaries, should be the greater between
its value in use (the present value of the future cash flows expected from its use) and its fair value less costs to sell.
Based on these criteria, the Group made in 2022, valuations of their investments for which there is goodwill recognised
considering among other factors:
(i) an estimate of future cash flows generated by each cash generating unit;
(ii) an expectation of potential changes in the amounts and timing of cash flows;
(iii) the time value of money;
(iv) a risk premium associated with the uncertainty by holding the asset; and
(v) other factors associated with the current situation of financial markets.
The valuations are based on reasonable and sustainable assumptions representing the best estimate of the Executive
Committee on the economic conditions that affect each subsidiary, the budgets and the latest projections approved for
those subsidiaries and their extrapolation to future periods. The assumptions made for these valuations might vary with
the change in economic conditions and in the market.
In 2022, there were no factors pointing to the deterioration of the value of those financial participations that could
lead to impairment charges in respect of goodwill, nor to the improvement of the value of those financial participations
that could lead to a reversion of previously booked impairments to the goodwill, except in the case of Bank Millennium
S.A. (Poland), in which case factors were identified during 2022 that showed a deterioration in the value of this
financial participation, which led to a total impairment of the goodwill then associated with the acquisition by the BCP
Group of the percentage of control over Bank Millennium S.A. (Poland) in the amount of Euros 102.3 million in the first
half of 2022.
Bank Millennium, S.A. (Poland)
The valuation exercises as of the end of 2021 and as of the end of the first half of 2022 considered as estimated cash
flows of the business the ones projected based on current operating results and assuming the business plan and
projections approved at the end of 2021 by the Executive Committee up to 2026. After that date, a perpetuity was
considered based on the average long-term expected adjusted rate of return for this activity in the Polish market.
Additionally, the market performance of Bank Millennium, S.A. in the Polish capital market was taken into
consideration (closing price of 8.195 PLN per share as at the end of 2021 and 3.886 PLN per share as at the end of the
first half of 2022) and the direct percentage of shareholding.
The above-mentioned business plan of Bank Millennium, S.A. covered a five-year period, from 2022 to 2026,
considering, along this period, an estimated compound annual growth rate of 7.0% (6.2% in 2020) for Total Assets and of
19.6% (8.4% in 2020) for Total Equity, while considering a ROE evolution from -8.0% by the end of 2022 to 17.6% by the
end of 2026 and 12.5% in perpetuity vs. an estimated evolution of 2.9% by the end of 2021 to 9.2% by the end of 2025
and 11.0% in perpetuity considered in 2020.
In the valuation exercise performed at year-end 2021, the exchange rate EUR/PLN considered was 4.5839 as at 31
December 2021. The Cost of Equity considered was 11.000% for the period 2022 to 2026 and in perpetuity, whereas
2020 exercise considered a Cost of Equity of 8.875% for the period 2021 to 2025 and in perpetuity, and, in both years, a
discretionary factor was considered to accommodate the uncertainty regarding the legal risk associated with the
mortgage loan portfolio in foreign currency to the PLN. The annual growth rate in perpetuity (g) was 2.88%.
Together with the business plans, other main assumptions considered for the impairment test were:
2021
2020
2019
Discount rate
11%
8.875%
8.565%
Growth rate (g)
2.88%
2.37%
2.8%
RoE steady state \u2013 Discount rate
1.5%
2.125%
1.935%
Despite the increase of the Cost of Equity and the negative deviation in shareholders' equity in the first half of 2022,
Bank Millennium S.A. (Poland) continued to deliver its Business Plan and projections with regard to operational
performance.
Notwithstanding the good operating performance of Bank Millennium S.A. (Poland), the expected effect that the
increase in reference interest rates has on the prospective evolution of net interest income and the fact that Bank
Millennium S.A. (Poland) continues to assess that the goodwill associated with the consumer credit business acquired
from EuroBank (40.9 million euros as at\u00a0 June 2022) is recoverable, given i) the sensitivity of the estimated value of the
Business Plan capitalized from end of 2021 to June 2022 to the main assumptions considered, ii) the variation of the
Shareholder\u2019s Equity in the first semester of 2022 when compared to the budgeted one, iii) the uncertainty associated
with the material impacts on the Business Plan and projections arising from potential regulatory and legislative
measures and those then communicated to the market, and iv) that the subsequent value estimate results in an
impairment amount proximate to the goodwill associated with the acquisition by the BCP Group of the current
percentage of control over Bank Millennium S.A. (Poland) in the amount of 102.3 million euros as at 30 June 2022, the
Executive Committee deemed it prudent to consider the total impairment of the goodwill then associated with the
acquisition by the BCP Group of the current percentage of control over Bank Millennium S.A. (Poland) in the amount of
Euros 102.3 million as at 30 June 2022.
The changes occurred in Goodwill and intangible assets, during 2022, are analysed as follows:
(Thousands of euros)
2022
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
159,431
\u2014
(2,512)
\u2014
(3,044)
153,875
Impairment for goodwill
(11,931)
(102,770)
2,512
\u2014
(346)
(112,535)
147,500
(102,770)
\u2014
\u2014
(3,390)
41,340
Intangible assets
Software
234,192
72,441
(25,315)
(3,664)
(449)
277,205
Other intangible assets
70,823
1,213
(1,037)
4,073
(1,465)
73,607
305,015
73,654
(26,352)
409
(1,914)
350,812
Accumulated depreciation
Software
(136,360)
(36,168)
24,859
419
451
(146,799)
Other intangible assets
(59,942)
(4,166)
1,027
(828)
1,239
(62,670)
(196,302)
(40,334)
25,886
(409)
1,690
(209,469)
108,713
33,320
(466)
\u2014
(224)
141,343
256,213
(69,450)
(466)
\u2014
(3,614)
182,683
The changes occurred in Goodwill and intangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
161,775
347
(3,558)
\u2014
867
159,431
Impairment for goodwill
(13,573)
(347)
1,989
\u2014
\u2014
(11,931)
148,202
\u2014
(1,569)
\u2014
867
147,500
Intangible assets
Software
201,918
49,781
(17,616)
(3,826)
3,935
234,192
Other intangible assets
67,777
\u2014
(341)
3,746
(359)
70,823
269,695
49,781
(17,957)
(80)
3,576
305,015
Accumulated depreciation
Software
(115,427)
(34,173)
15,543
57
(2,360)
(136,360)
Other intangible assets
(56,516)
(4,011)
341
(57)
301
(59,942)
(171,943)
(38,184)
15,884
\u2014
(2,059)
(196,302)
97,752
11,597
(2,073)
(80)
1,517
108,713
245,954
11,597
(3,642)
(80)
2,384
256,213
", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsAndGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-670": { "value": "
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
102,655
104,843
Euro Bank, S.A. (Poland)
41,038
41,913
Others
10,182
12,675
153,875
159,431
Impairment
Bank Millennium, S.A. (Poland)
(102,655)
\u2014
Others
(9,880)
(11,931)
(112,535)
(11,931)
41,340
147,500
Intangible assets
Software
277,205
234,192
Other intangible assets
73,607
70,823
350,812
305,015
Accumulated amortisation
Charge for the year (note 9)
(40,334)
(38,184)
Charge for the previous years
(169,131)
(158,118)
(209,465)
(196,302)
141,347
108,713
182,687
256,213
The changes occurred in Goodwill and intangible assets, during 2022, are analysed as follows:
(Thousands of euros)
2022
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
159,431
\u2014
(2,512)
\u2014
(3,044)
153,875
Impairment for goodwill
(11,931)
(102,770)
2,512
\u2014
(346)
(112,535)
147,500
(102,770)
\u2014
\u2014
(3,390)
41,340
Intangible assets
Software
234,192
72,441
(25,315)
(3,664)
(449)
277,205
Other intangible assets
70,823
1,213
(1,037)
4,073
(1,465)
73,607
305,015
73,654
(26,352)
409
(1,914)
350,812
Accumulated depreciation
Software
(136,360)
(36,168)
24,859
419
451
(146,799)
Other intangible assets
(59,942)
(4,166)
1,027
(828)
1,239
(62,670)
(196,302)
(40,334)
25,886
(409)
1,690
(209,469)
108,713
33,320
(466)
\u2014
(224)
141,343
256,213
(69,450)
(466)
\u2014
(3,614)
182,683
The changes occurred in Goodwill and intangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
161,775
347
(3,558)
\u2014
867
159,431
Impairment for goodwill
(13,573)
(347)
1,989
\u2014
\u2014
(11,931)
148,202
\u2014
(1,569)
\u2014
867
147,500
Intangible assets
Software
201,918
49,781
(17,616)
(3,826)
3,935
234,192
Other intangible assets
67,777
\u2014
(341)
3,746
(359)
70,823
269,695
49,781
(17,957)
(80)
3,576
305,015
Accumulated depreciation
Software
(115,427)
(34,173)
15,543
57
(2,360)
(136,360)
Other intangible assets
(56,516)
(4,011)
341
(57)
301
(59,942)
(171,943)
(38,184)
15,884
\u2014
(2,059)
(196,302)
97,752
11,597
(2,073)
(80)
1,517
108,713
245,954
11,597
(3,642)
(80)
2,384
256,213
", "dimensions": { "concept": "ifrs-full:DisclosureOfIntangibleAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-671": { "value": "
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Goodwill - Differences arising on consolidation
Bank Millennium, S.A. (Poland)
102,655
104,843
Euro Bank, S.A. (Poland)
41,038
41,913
Others
10,182
12,675
153,875
159,431
Impairment
Bank Millennium, S.A. (Poland)
(102,655)
\u2014
Others
(9,880)
(11,931)
(112,535)
(11,931)
41,340
147,500
Intangible assets
Software
277,205
234,192
Other intangible assets
73,607
70,823
350,812
305,015
Accumulated amortisation
Charge for the year (note 9)
(40,334)
(38,184)
Charge for the previous years
(169,131)
(158,118)
(209,465)
(196,302)
141,347
108,713
182,687
256,213
The changes occurred in Goodwill and intangible assets, during 2022, are analysed as follows:
(Thousands of euros)
2022
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
159,431
\u2014
(2,512)
\u2014
(3,044)
153,875
Impairment for goodwill
(11,931)
(102,770)
2,512
\u2014
(346)
(112,535)
147,500
(102,770)
\u2014
\u2014
(3,390)
41,340
Intangible assets
Software
234,192
72,441
(25,315)
(3,664)
(449)
277,205
Other intangible assets
70,823
1,213
(1,037)
4,073
(1,465)
73,607
305,015
73,654
(26,352)
409
(1,914)
350,812
Accumulated depreciation
Software
(136,360)
(36,168)
24,859
419
451
(146,799)
Other intangible assets
(59,942)
(4,166)
1,027
(828)
1,239
(62,670)
(196,302)
(40,334)
25,886
(409)
1,690
(209,469)
108,713
33,320
(466)
\u2014
(224)
141,343
256,213
(69,450)
(466)
\u2014
(3,614)
182,683
The changes occurred in Goodwill and intangible assets during 2021 are analysed as follows:
(Thousands of euros)
2021
Balance on
1 January
Acquisitions
/ Charge
Disposals
/ Charged-off
Transfers
Exchange
differences
Balance on
31 December
Goodwill - Differences arising
on consolidation
161,775
347
(3,558)
\u2014
867
159,431
Impairment for goodwill
(13,573)
(347)
1,989
\u2014
\u2014
(11,931)
148,202
\u2014
(1,569)
\u2014
867
147,500
Intangible assets
Software
201,918
49,781
(17,616)
(3,826)
3,935
234,192
Other intangible assets
67,777
\u2014
(341)
3,746
(359)
70,823
269,695
49,781
(17,957)
(80)
3,576
305,015
Accumulated depreciation
Software
(115,427)
(34,173)
15,543
57
(2,360)
(136,360)
Other intangible assets
(56,516)
(4,011)
341
(57)
301
(59,942)
(171,943)
(38,184)
15,884
\u2014
(2,059)
(196,302)
97,752
11,597
(2,073)
(80)
1,517
108,713
245,954
11,597
(3,642)
(80)
2,384
256,213
", "dimensions": { "concept": "ifrs-full:DisclosureOfGoodwillExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-672": { "value": "Income tax
The deferred income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
982,465
\u2014
982,465
983,177
\u2014
983,177
Employee benefits
835,619
\u2014
835,619
835,619
\u2014
835,619
1,818,084
\u2014
1,818,084
1,818,796
\u2014
1,818,796
Deferred taxes depending
on the future profits
Impairment losses (b)
438,430
(50,303)
388,127
601,925
(50,303)
551,622
Tax losses carried forward
188,693
\u2014
188,693
187,475
\u2014
187,475
Employee benefits
50,770
(136,019)
(85,249)
55,274
(6,918)
48,356
Financial assets at fair value through other
comprehensive income
729,416
(134,154)
595,262
125,907
(104,865)
21,042
Derivatives
\u2014
(5,482)
(5,482)
\u2014
(4,923)
(4,923)
Intangible assets
1,143
\u2014
1,143
1,639
\u2014
1,639
Other tangible assets
8,693
(3,380)
5,313
8,835
(4,037)
4,798
Others
111,336
(89,949)
21,387
123,468
(80,989)
42,479
1,528,481
(419,287)
1,109,194
1,104,523
(252,035)
852,488
Total deferred taxes
3,346,565
(419,287)
2,927,278
2,923,319
(252,035)
2,671,284
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(407,579)
407,579
\u2014
(235,103)
235,103
\u2014
Net deferred taxes
2,938,986
(11,708)
2,927,278
2,688,216
(16,932)
2,671,284
(a) Special Regime applicable to deferred tax assets
(b) The amounts as at 31 December 2022 and 2021 include deferred tax assets related with credit impairments non-accepted fiscally
of which credits were written-off, according to the expectation that the use of such impairments will be deductible for the purposes
of determining taxable income for the tax periods in which the legal conditions required for their tax deductibility are met.
As at 31 December 2022, the balance deferred tax assets amounts to Euros 2,938,986,000, of which Euros 2,750,881,000
are related to the Bank's activity. The deferred taxes assets relating to the individual activity include a net amount of
Euros 532,498,000 resulting from potential losses on derivatives of hedging cash flows from interest rate risk recognized
in other comprehensive income, whose average maturity of operations is four years and Euros 400,330,000 which
depends on the existence of future profitable profits (deferred tax assets not eligible under the special regime
applicable to deferred tax assets, approved by Law No. 61/2014, of 26 August), including:
- Euros 259,983,000 (net value) related to impairment losses; and
- Euros 162,400,000 resulting from tax losses carried forward from 2016 and 2020.
Special regime applicable to deferred tax assets
The Extraordinary General Meeting of the Bank that took place on 15 October 2014 approved the Bank's accession to the
Special Regime approved by Law No. 61/2014, of 26 August, applicable to deferred tax assets that resulted from not
deduction of expenses and negative equity variations with impairment losses on credits and post-employment or long-
term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods beginning on
or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last tax period prior
to that date and to part of expenses and negative equity variations associated with them. Pursuant to Law No. 23/2016,
of 19 August, this special regime is not applicable to expenses and negative equity variations with impairment losses on
credits and with post-employment or long-term employee benefits recorded in the period's taxation commencing on or
after 1 January 2016, nor to deferred tax assets to these associates.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-term
employee benefits covered by it are deducted, under the terms and conditions set out in the IRC Code and in relevant
separate tax legislation, up to the limit of the taxable profit for the tax period determined before these deductions.
Expenses and negative equity variations not deducted because of applying this limit are deducted in subsequent tax
periods, with the same limit. In the BCP Group, deferred tax assets associated with expenses and negative equity
variations under these conditions amount to Euros 1,599,199,000 (31 December 2021: Euros 1,569,265,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorization), deferred tax assets covered by
the Special Regime are converted into tax credits, in part or in wholeness. In situations of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period and the
total of equity capital, and a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights attributable to the State of equivalent value, rights that can be acquired by the
shareholders upon payment to the State of the same value. Tax credits may be offset against tax debts of the
beneficiaries (or an entity based in Portugal within the same prudential consolidation perimeter or included in the same
group of entities for which are applied the Special Tax Regime for Groups of Companies) or reimbursed by the State.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by Law
No. 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance no. 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law No. 98/2019, of 4
September, establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after
which the Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these rights are
subject to a right of acquisition by the shareholders on the date of creation of the rights of the State, exercisable in
periods that will be established by the Board of Directors until 3 years after the confirmation date of the conversion of
the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing entity shall deposit in
favour of the State the amount of the price corresponding to all the rights issued, within 3 months beginning from the
confirmation date of the conversion of the deferred tax asset into tax credit. Such deposit shall be redeemed when and
to the extent that the rights of the State are acquired by the shareholders or exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the approved rates or substantially approved at the balance sheet date. The deferred
tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law, current tax assets
and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities related to income
taxes levied by the same fiscal authority over the same taxable entity.
The current tax rate for Banco Comercial Portugu\u00eas, S.A. is analysed as follows:
2022
2021
Income tax
21%
21%
Municipal surtax rate (on taxable net income)
1.5%
1.5%
State tax rate (on taxable net income)
More than 1,500,000 to 7,500,000
3%
3%
From more than 7,500,000 to 35,000,000
5%
5%
More than 35,000,000
9%
9%
companies that comprise it. Income tax is calculated and registered, on an individual basis, in each of the Companies
that make up the RETGS as if the regime were not applicable. The effect of the offset between taxable income and tax
losses is reflected in the company that calculates tax losses.
The balance of Deferred tax assets not depending on the future profits (covered by the regime approved by Law no.
61/2014, of 26 August) includes the amounts of Euros 210,686,000 and Euros 4,020,000 recorded in 2015 and 2016,
respectively, related to expenses and negative equity variations with post-employment or long-term employee benefits
and to impairment losses in loans accounted until 31 December 2014.
Following the publication of the Notice of Bank of Portugal No. 5/2015, the entities that presented their financial
statements in Adjusted Accounting Standards issued by the Bank of Portugal (NCA), since 1 January 2016 began to apply
the International Financial Reporting Standards as adopted in the European Union, including, among others, the Bank's
individual financial statements.
As a result of this change, in the Bank's individual financial statements, the loans portfolio, guarantees provided and
other operations of a similar nature became subject to impairment losses calculated in accordance with the
requirements of International Accounting Standards (IAS 39 until 31 December 2017 and IFRS 9 since 1 January 2018),
replacing the registration of provisions for specific risk, for general credit risks and for country risk, in accordance with
Bank of Portugal\u2019s Notice No. 3/95.
The Regulatory Decrees No. 5/2016, of 18 November, No. 11/2017, of 28 December, and No. 13/2018, of 28 December,
established the maximum limits of impairment losses and other corrections of value for specific credit risk that are
deductible for the purpose of calculating the taxable profit under IRC in 2016, 2017 and 2018, respectively. These
Decrees declare that Bank of Portugal Notice No. 3/95 (Notice that was relevant for determining provisions for credit in
the financial statements presented on an NCA basis) should be considered for the purpose of calculating the maximum
limits of impairment losses accepted for tax purposes in 2016, 2017 and 2018, respectively.
In calculating the taxable income for the year 2021, the maintenance of the tax rules in force until 2018 was
considered. In 2022, Banco Comercial Portugu\u00eas, S.A. and Banco ActivoBank, S.A. exercised the option to apply the
regime introduced by Law No. 98/2019, of September 4, under which impairment losses for credit risk relating to
exposures analysed on an individual basis or on a collective basis recognised under the terms of the applicable
accounting and regulatory standards and the rules in force until 2018 for the balance of impairment losses and other
value corrections for specific credit risk recorded until 31 December 2021 are maintained.
The Group complies with the guidelines of IFRIC 23 - Uncertainty over Income Tax Treatments on the determination of
taxable profit, tax bases, tax losses to be reported, tax credits to be used and tax rates in scenarios of uncertainty
regarding the income tax treatment, not having occurred material impact on the financial statements resulting from its
application.
Analysis of the recoverability of deferred tax assets
In accordance with the accounting policy 1 Y.3 and with the requirements of IAS 12, the deferred tax assets were
recognised based on the Group's expectation of their recoverability. The recoverability of deferred taxes depends on
the implementation of the strategy of the Bank's Board of Directors, namely the generation of estimated taxable
income and its interpretation of tax legislation. Any changes in the assumptions used in estimating future profits or tax
legislation may have material impacts on deferred tax assets.
The assessment of the recoverability of deferred taxes assets is based on the projection of results for the period
between 2023 and 2032. The projected results before taxes for the years 2023, 2024 and 2025 are consistent with the
budget approved by the Board of Directors of the Bank in December 2022, which incorporates the priorities arising from
the Strategic Plan 2021-2024.
The abandonment of negative interest rates, which imposed a burden on banks, is favourably reflected in projected
profitability and convergence towards medium/long-term metrics and trends consistent with commercial positioning
and the coveted capture of efficiency gains, established in the review of the 2021-2024 Strategic Plan approved by the
corporate bodies, highlighting:
- the improvement in net interest income, which mainly reflects the referred increase in market interest rates and also
benefits from the preserving of the deposit base, the effort to grow credit and also the reinvestment of assets at the
new interest rates;
- the increase in commission income based on efficient and judicious management of commissioning and pricing
- the reduction of the cost of risk for levels in line with the Bank's current activity, with a lesser impact from the
historical portfolios of NPE, foreclosed assets and FRE (Corporate Restructuring Funds), consolidated the reduction of
these exposures achieved over the last years;
- capturing efficiency gains enhanced by digitalization, reflected in the control of operating costs, after the staff
reduction carried out in 2021.
To estimate taxable net income for the periods of 2023 to 2032, the following main assumptions were considered:
- The rules of the new tax regime of credit impairment were applied. In the application of these rules, the following
assumptions were considered, in general terms:
a) the impairment losses for credit risk relating to exposures analysed on an individual or collective basis, recognised
in accordance with the applicable accounting and regulatory standards, were considered deductible for tax purposes;
b) impairment reversals created until 31 December 2021 not accepted for tax purposes were estimated based on the
Reduction Plan of Non-Performing Assets 2022-2024 submitted to the supervisory authority in March 2022, and also on
the average reversal percentage observed in the last years of 2016 to 2022;
c) the referred average percentages were calculated separately, according to the presence or not of a mortgage
security, the eligibility for the special regime applicable to deferred tax assets and according to the clients\u2019 rating as
Non-Performing\u00a0 Exposures (NPE).
- The deductions related to impairment of financial assets were projected based on the destination (sale or settlement)
and the estimated date of the respective operations;
- Reversals of impairment of non-financial assets not accepted for tax purposes were projected considering the
expected periods of disinvestment in certain real estate. For the remaining assets without a forecasted term for
disinvestment, the reversals were estimated based on the average percentage of reversal observed in the years from
2016 to 2022. Non-deductible expenses related to the reinforcement of impairment of non-financial assets were
estimated on the based on the average percentage of amounts not deducted for tax purposes in the years from 2016 to
2022, compared to the amounts of reinforcements net of impairment recorded in those years.\u00a0
- The deductions related to employee benefits were projected based on their estimated payments or deduction plans,
in accordance with information provided by the actuary of the pension fund.\u00a0
- The realization of changes in the fair value of real estate investment funds was projected based on the information
available in the management agreements of the funds in question for the period expected for the respective
liquidation.
According to the estimate of future taxable income, the deferred taxes assets recorded as at 31 December 2022 are
adequate under the IAS 12 requirements.
In accordance with these assessments, the amount of unrecognised deferred tax related to tax losses, by year of origin
is as follows:
(Thousands of euros)
Tax losses carried forward
2022
2021
2014
161,895
160,206
2015
2
269
2016
286,419
286,422
2017
2,303
2,309
2018
108,234
108,261
2019
24,265
40,591
2020
2,307
2,359
2021
207,294
200,743
2022
21,080
\u2014
813,799
801,160
as follows:
(Thousands of euros)
2022
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(712)
\u2014
\u2014
(712)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(160,953)
\u2014
(2,542)
Tax losses carried forward (a)
2,785
(2,236)
669
Employee benefits
(6,199)
(126,957)
(449)
Financial assets at fair value through other comprehensive income
\u2014
575,491
(1,271)
Derivatives
\u2014
\u2014
(559)
Intangible assets
(463)
\u2014
(33)
Other tangible assets
503
\u2014
12
Others
(29,649)
6,803
1,755
(193,976)
453,101
(2,418)
(194,688)
453,101
(2,418)
Current taxes
Current year
(110,551)
(18)
\u2014
Correction of previous years
919
\u2014
\u2014
(109,632)
(18)
\u2014
(304,320)
453,083
(2,418)
The impact of income taxes in Net\u00a0 income and in other balances of Group's equity, as at 31 December 2021, is analysed
as follows:
(Thousands of euros)
2021
Net income for
the year
Reserves
Exchange
differences
Discontinued
operations (b)
Deferred taxes not depending on the future profits
Employee benefits
(1,288)
(2)
\u2014
\u2014
(1,288)
(2)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(121,002)
\u2014
(937)
\u2014
Tax losses carried forward (a)
15,567
3,353
3,607
(11,937)
Employee benefits
4,774
(10,218)
(283)
(643)
Financial assets at fair value through other
comprehensive income
\u2014
184,667
(12,286)
20
Derivatives
\u2014
\u2014
(472)
\u2014
Intangible assets
(382)
\u2014
1,972
\u2014
Other tangible assets
(174)
\u2014
(1,939)
\u2014
Others
(19,768)
332
11,802
(27)
(120,985)
178,134
1,464
(12,587)
(122,273)
178,132
1,464
(12,587)
Current taxes
Current year
(81,689)
6
\u2014
(3,233)
Correction of previous years
336
\u2014
\u2014
\u2014
(81,353)
6
\u2014
(3,233)
(203,626)
178,138
1,464
(15,820)
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity
changes recorded in reserves that contribute to the calculation of taxable income.
(b) Relates to Banque Priv\u00e9e BCP (Suisse), S.A. and Seguradora Internacional de Mo\u00e7ambique, S.A. (now designated Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.)
The reconciliation between the nominal tax rate and the effective tax rate is analysed as follows:
(Thousands of euros)
2022
2021
Net income / (loss) before income taxes
428,458
157,737
Current tax rate (%)
31.5%
31.5%
Expected tax
(134,964)
(49,687)
Non-deductible impairment and provisions (a)
(145,811)
(100,417)
Mandatory contributions to the banking sector (b)
(25,502)
(30,400)
Results of companies accounted by the equity method
21,657
17,935
Interests on other equity instruments (c)
11,655
11,655
Effect of the tax rate difference (d)
(8,508)
(20,002)
Effect of recognition/derecognition net of deferred taxes (e)
(24,252)
(23,400)
Non-deductible costs and other corrections
2,013
(2,875)
Correction of previous years
660
(5,410)
Autonomous tax
(1,268)
(1,025)
Total
(304,320)
(203,626)
Effective rate (%)
71.0%
129.1%
(e) In 2022 includes the negative amount of Euros 12,916,000 relating to unrecognized deferred taxes on tax losses for the year of\u00a0 BIM
\u2013 Banco Internacional de Mo\u00e7ambique. In 2021, it includes the negative amount of Euros 2,071,000 related to unrecognized income
taxes losses for the year of BIM and the negative amount of Euros 18,784,000 related to the non-recognition of deferred taxes on
temporary differences.
", "dimensions": { "concept": "ifrs-full:DisclosureOfIncomeTaxExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-674": { "value": "
The deferred income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
982,465
\u2014
982,465
983,177
\u2014
983,177
Employee benefits
835,619
\u2014
835,619
835,619
\u2014
835,619
1,818,084
\u2014
1,818,084
1,818,796
\u2014
1,818,796
Deferred taxes depending
on the future profits
Impairment losses (b)
438,430
(50,303)
388,127
601,925
(50,303)
551,622
Tax losses carried forward
188,693
\u2014
188,693
187,475
\u2014
187,475
Employee benefits
50,770
(136,019)
(85,249)
55,274
(6,918)
48,356
Financial assets at fair value through other
comprehensive income
729,416
(134,154)
595,262
125,907
(104,865)
21,042
Derivatives
\u2014
(5,482)
(5,482)
\u2014
(4,923)
(4,923)
Intangible assets
1,143
\u2014
1,143
1,639
\u2014
1,639
Other tangible assets
8,693
(3,380)
5,313
8,835
(4,037)
4,798
Others
111,336
(89,949)
21,387
123,468
(80,989)
42,479
1,528,481
(419,287)
1,109,194
1,104,523
(252,035)
852,488
Total deferred taxes
3,346,565
(419,287)
2,927,278
2,923,319
(252,035)
2,671,284
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(407,579)
407,579
\u2014
(235,103)
235,103
\u2014
Net deferred taxes
2,938,986
(11,708)
2,927,278
2,688,216
(16,932)
2,671,284
(a) Special Regime applicable to deferred tax assets
(b) The amounts as at 31 December 2022 and 2021 include deferred tax assets related with credit impairments non-accepted fiscally
of which credits were written-off, according to the expectation that the use of such impairments will be deductible for the purposes
of determining taxable income for the tax periods in which the legal conditions required for their tax deductibility are met.
As at 31 December 2022, the balance deferred tax assets amounts to Euros 2,938,986,000, of which Euros 2,750,881,000
are related to the Bank's activity. The deferred taxes assets relating to the individual activity include a net amount of
Euros 532,498,000 resulting from potential losses on derivatives of hedging cash flows from interest rate risk recognized
in other comprehensive income, whose average maturity of operations is four years and Euros 400,330,000 which
depends on the existence of future profitable profits (deferred tax assets not eligible under the special regime
applicable to deferred tax assets, approved by Law No. 61/2014, of 26 August), including:
- Euros 259,983,000 (net value) related to impairment losses; and
- Euros 162,400,000 resulting from tax losses carried forward from 2016 and 2020.
Special regime applicable to deferred tax assets
The Extraordinary General Meeting of the Bank that took place on 15 October 2014 approved the Bank's accession to the
Special Regime approved by Law No. 61/2014, of 26 August, applicable to deferred tax assets that resulted from not
deduction of expenses and negative equity variations with impairment losses on credits and post-employment or long-
term employee benefits.
The special regime is applicable to those expenses and negative equity variations recorded in tax periods beginning on
or after 1 January 2015, as well as to deferred tax assets recorded in the annual accounts for the last tax period prior
to that date and to part of expenses and negative equity variations associated with them. Pursuant to Law No. 23/2016,
of 19 August, this special regime is not applicable to expenses and negative equity variations with impairment losses on
credits and with post-employment or long-term employee benefits recorded in the period's taxation commencing on or
after 1 January 2016, nor to deferred tax assets to these associates.
The special regime applicable to deferred tax assets provides for an optional framework and with the possibility of
subsequent waiver, under which:
- Expenses and negative equity variations with impairment losses on credits and with post-employment or long-term
employee benefits covered by it are deducted, under the terms and conditions set out in the IRC Code and in relevant
separate tax legislation, up to the limit of the taxable profit for the tax period determined before these deductions.
Expenses and negative equity variations not deducted because of applying this limit are deducted in subsequent tax
periods, with the same limit. In the BCP Group, deferred tax assets associated with expenses and negative equity
variations under these conditions amount to Euros 1,599,199,000 (31 December 2021: Euros 1,569,265,000).
- In certain situations (those with negative net results in annual individual accounts or liquidation by voluntary
dissolution, insolvency decreed by court or revocation of the respective authorization), deferred tax assets covered by
the Special Regime are converted into tax credits, in part or in wholeness. In situations of negative net income, the
conversion is made according to the proportion between the amount of the negative net income for the period and the
total of equity capital, and a special reserve corresponding to 110% of the tax credit must be constituted and,
simultaneously, conversion rights attributable to the State of equivalent value, rights that can be acquired by the
shareholders upon payment to the State of the same value. Tax credits may be offset against tax debts of the
beneficiaries (or an entity based in Portugal within the same prudential consolidation perimeter or included in the same
group of entities for which are applied the Special Tax Regime for Groups of Companies) or reimbursed by the State.
Pursuant to the regime described, the recovery of deferred tax assets covered by the optional regime approved by Law
No. 61/2014, of 26 August, is not dependent on future profits.
The above-mentioned legal framework was densified by Ordinance no. 259/2016, of 4 October, about the control and
use of tax credits, and by the Ordinance No. 293-A/2016, of 18 November, which establishes the conditions and
procedures for the acquisition by the shareholders of the referred rights of the State. Law No. 98/2019, of 4
September, establishes a deadline for the acquisition of the referred rights of the State by the shareholders, after
which the Management Board of the issuing bank is obliged to promote the record of the capital increase by the amount
resulting from the exercise of the conversion rights. According to this legislation, among other aspects, these rights are
subject to a right of acquisition by the shareholders on the date of creation of the rights of the State, exercisable in
periods that will be established by the Board of Directors until 3 years after the confirmation date of the conversion of
the deferred tax asset into tax credit by the Portuguese Tax and Customs Authority. The issuing entity shall deposit in
favour of the State the amount of the price corresponding to all the rights issued, within 3 months beginning from the
confirmation date of the conversion of the deferred tax asset into tax credit. Such deposit shall be redeemed when and
to the extent that the rights of the State are acquired by the shareholders or exercised by the State.
Deferred taxes are calculated based on the tax rates expected to be in force when the temporary differences are
reversed, which correspond to the approved rates or substantially approved at the balance sheet date. The deferred
tax assets and liabilities are presented on a net basis whenever, in accordance with applicable law, current tax assets
and current tax liabilities can be offset with each other, and the deferred tax assets and liabilities related to income
taxes levied by the same fiscal authority over the same taxable entity.
", "dimensions": { "concept": "ifrs-full:DisclosureOfTaxReceivablesAndPayablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-673": { "value": "
The deferred income tax assets and liabilities are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Liabilities
Net
Assets
Liabilities
Net
Deferred taxes not depending
on the future profits (a)
Impairment losses (b)
982,465
\u2014
982,465
983,177
\u2014
983,177
Employee benefits
835,619
\u2014
835,619
835,619
\u2014
835,619
1,818,084
\u2014
1,818,084
1,818,796
\u2014
1,818,796
Deferred taxes depending
on the future profits
Impairment losses (b)
438,430
(50,303)
388,127
601,925
(50,303)
551,622
Tax losses carried forward
188,693
\u2014
188,693
187,475
\u2014
187,475
Employee benefits
50,770
(136,019)
(85,249)
55,274
(6,918)
48,356
Financial assets at fair value through other
comprehensive income
729,416
(134,154)
595,262
125,907
(104,865)
21,042
Derivatives
\u2014
(5,482)
(5,482)
\u2014
(4,923)
(4,923)
Intangible assets
1,143
\u2014
1,143
1,639
\u2014
1,639
Other tangible assets
8,693
(3,380)
5,313
8,835
(4,037)
4,798
Others
111,336
(89,949)
21,387
123,468
(80,989)
42,479
1,528,481
(419,287)
1,109,194
1,104,523
(252,035)
852,488
Total deferred taxes
3,346,565
(419,287)
2,927,278
2,923,319
(252,035)
2,671,284
Offset between deferred tax assets
and deferred tax liabilities\u00a0
(407,579)
407,579
\u2014
(235,103)
235,103
\u2014
Net deferred taxes
2,938,986
(11,708)
2,927,278
2,688,216
(16,932)
2,671,284
(a) Special Regime applicable to deferred tax assets
In accordance with these assessments, the amount of unrecognised deferred tax related to tax losses, by year of origin
is as follows:
(Thousands of euros)
Tax losses carried forward
2022
2021
2014
161,895
160,206
2015
2
269
2016
286,419
286,422
2017
2,303
2,309
2018
108,234
108,261
2019
24,265
40,591
2020
2,307
2,359
2021
207,294
200,743
2022
21,080
\u2014
813,799
801,160
as follows:
(Thousands of euros)
2022
Net income for
the year
Reserves
Exchange
differences
Deferred taxes not depending on the future profits
Impairment losses
(712)
\u2014
\u2014
(712)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(160,953)
\u2014
(2,542)
Tax losses carried forward (a)
2,785
(2,236)
669
Employee benefits
(6,199)
(126,957)
(449)
Financial assets at fair value through other comprehensive income
\u2014
575,491
(1,271)
Derivatives
\u2014
\u2014
(559)
Intangible assets
(463)
\u2014
(33)
Other tangible assets
503
\u2014
12
Others
(29,649)
6,803
1,755
(193,976)
453,101
(2,418)
(194,688)
453,101
(2,418)
Current taxes
Current year
(110,551)
(18)
\u2014
Correction of previous years
919
\u2014
\u2014
(109,632)
(18)
\u2014
(304,320)
453,083
(2,418)
The impact of income taxes in Net\u00a0 income and in other balances of Group's equity, as at 31 December 2021, is analysed
as follows:
(Thousands of euros)
2021
Net income for
the year
Reserves
Exchange
differences
Discontinued
operations (b)
Deferred taxes not depending on the future profits
Employee benefits
(1,288)
(2)
\u2014
\u2014
(1,288)
(2)
\u2014
\u2014
Deferred taxes depending on the future profits
Impairment losses
(121,002)
\u2014
(937)
\u2014
Tax losses carried forward (a)
15,567
3,353
3,607
(11,937)
Employee benefits
4,774
(10,218)
(283)
(643)
Financial assets at fair value through other
comprehensive income
\u2014
184,667
(12,286)
20
Derivatives
\u2014
\u2014
(472)
\u2014
Intangible assets
(382)
\u2014
1,972
\u2014
Other tangible assets
(174)
\u2014
(1,939)
\u2014
Others
(19,768)
332
11,802
(27)
(120,985)
178,134
1,464
(12,587)
(122,273)
178,132
1,464
(12,587)
Current taxes
Current year
(81,689)
6
\u2014
(3,233)
Correction of previous years
336
\u2014
\u2014
\u2014
(81,353)
6
\u2014
(3,233)
(203,626)
178,138
1,464
(15,820)
(a) The amount recorded in reserves refers to the deferred tax on the part of tax loss arising from the deduction of negative equity
changes recorded in reserves that contribute to the calculation of taxable income.
(b) Relates to Banque Priv\u00e9e BCP (Suisse), S.A. and Seguradora Internacional de Mo\u00e7ambique, S.A. (now designated Fidelidade
Mo\u00e7ambique - Companhia de Seguros S.A.)
", "dimensions": { "concept": "ifrs-full:DisclosureOfDeferredTaxesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-675": { "value": "Other assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposit account applications
51,371
396,638
Capital supplies
178,725
244,991
Obligations with post-employment benefits (note 50)
593,494
202,366
Debtors for futures and options transactions
191,290
138,688
Debtors
\u00a0 Residents
\u00a0\u00a0Receivables from real estate,\u00a0transfers of assets and other securities
111,693
109,509
\u00a0\u00a0\u00a0\u00a0 Prosecution cases / agreements with the Bank
12,163
13,037
\u00a0\u00a0\u00a0\u00a0 SIBS
3,521
3,490
\u00a0\u00a0\u00a0\u00a0 Others
66,744
23,569
\u00a0 Non-residents
30,584
51,909
Amounts due for collection
80,024
81,082
Interest and other amounts receivable
69,613
69,354
Amounts receivable on trading activity
3,234
32,303
Amounts due from customers
51,229
29,020
Artistic patrimony
28,796
28,818
Prepaid expenses
23,654
23,157
Subsidies receivables
10,764
15,656
Other recoverable tax
9,082
11,696
Gold and other precious metals
3,640
3,851
Capital supplementary contributions
165
165
Associated companies
145
162
Sundry assets
254,276
166,030
1,774,207
1,645,491
Impairment for other assets
(191,752)
(260,199)
1,582,455
1,385,292
As referred in note 47, as at 31 December 2022, the item Capital supplies includes the amount of Euros 171,397,000 (31
December 2021: Euros 237,671,000) arising from the transfers of assets to Specialized recovery funds which have
impairment in the same amount.
As at 31 December 2021, the balance Deposit account applications included the amount of Euros 348,559,000 on the
Clearing houses / Clearing derivatives. During 2022, this type of operations was recorded directly in the book value of
trading and hedging derivatives, as a result of the change made in the clearing process from CTM (Collateralised-to-
Market) to STM (Settled-to-Market).
The balance Amounts receivable on trading activity includes amounts receivable within 3 business days of stock
exchange operations.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is to
periodically assess the collectability of these amounts and whenever impairment is identified, an impairment loss is
registered in the income statement.
The changes occurred in Impairment of other assets are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
260,199
265,342
Transfers resulting from changes in the Group's structure (SIM - Seguradora
Internacional de Mo\u00e7ambique)
(1,038)
(375)
Other transfers
908
536
Charge for the year (note 12)
17,699
16,618
Reversals for the year (note 12)
(7,047)
(9,263)
Amounts charged-off
(78,835)
(12,717)
Exchange rate differences
(134)
58
Balance at the end of the year
191,752
260,199
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherReceivablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-676": { "value": "Other assets
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposit account applications
51,371
396,638
Capital supplies
178,725
244,991
Obligations with post-employment benefits (note 50)
593,494
202,366
Debtors for futures and options transactions
191,290
138,688
Debtors
\u00a0 Residents
\u00a0\u00a0Receivables from real estate,\u00a0transfers of assets and other securities
111,693
109,509
\u00a0\u00a0\u00a0\u00a0 Prosecution cases / agreements with the Bank
12,163
13,037
\u00a0\u00a0\u00a0\u00a0 SIBS
3,521
3,490
\u00a0\u00a0\u00a0\u00a0 Others
66,744
23,569
\u00a0 Non-residents
30,584
51,909
Amounts due for collection
80,024
81,082
Interest and other amounts receivable
69,613
69,354
Amounts receivable on trading activity
3,234
32,303
Amounts due from customers
51,229
29,020
Artistic patrimony
28,796
28,818
Prepaid expenses
23,654
23,157
Subsidies receivables
10,764
15,656
Other recoverable tax
9,082
11,696
Gold and other precious metals
3,640
3,851
Capital supplementary contributions
165
165
Associated companies
145
162
Sundry assets
254,276
166,030
1,774,207
1,645,491
Impairment for other assets
(191,752)
(260,199)
1,582,455
1,385,292
As referred in note 47, as at 31 December 2022, the item Capital supplies includes the amount of Euros 171,397,000 (31
December 2021: Euros 237,671,000) arising from the transfers of assets to Specialized recovery funds which have
impairment in the same amount.
As at 31 December 2021, the balance Deposit account applications included the amount of Euros 348,559,000 on the
Clearing houses / Clearing derivatives. During 2022, this type of operations was recorded directly in the book value of
trading and hedging derivatives, as a result of the change made in the clearing process from CTM (Collateralised-to-
Market) to STM (Settled-to-Market).
The balance Amounts receivable on trading activity includes amounts receivable within 3 business days of stock
exchange operations.
Considering the nature of these transactions and the age of the amounts of these items, the Group's procedure is to
periodically assess the collectability of these amounts and whenever impairment is identified, an impairment loss is
registered in the income statement.
The changes occurred in Impairment of other assets are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
260,199
265,342
Transfers resulting from changes in the Group's structure (SIM - Seguradora
Internacional de Mo\u00e7ambique)
(1,038)
(375)
Other transfers
908
536
Charge for the year (note 12)
17,699
16,618
Reversals for the year (note 12)
(7,047)
(9,263)
Amounts charged-off
(78,835)
(12,717)
Exchange rate differences
(134)
58
Balance at the end of the year
191,752
260,199
", "dimensions": { "concept": "ifrs-full:DisclosureOfPrepaymentsAndOtherAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-677": { "value": "Resources from credit institutions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Resources and other financing
from Central Banks
Bank of Portugal
\u2014
592,740
592,740
\u2014
8,028,747
8,028,747
Central Banks abroad
\u2014
14,736
14,736
\u2014
82,155
82,155
\u2014
607,476
607,476
\u2014
8,110,902
8,110,902
Resources from credit institutions in
Portugal
Sight deposits
92,493
\u2014
92,493
96,654
\u2014
96,654
Term Deposits
\u2014
151,244
151,244
\u2014
64,217
64,217
CIRS and IRS operations collateralised
by deposits (*)
\u2014
\u2014
\u2014
\u2014
1,620
1,620
Other resources
\u2014
\u2014
\u2014
\u2014
1
1
92,493
151,244
243,737
96,654
65,838
162,492
Resources from credit institutions
abroad
Repayable on demand
74,890
\u2014
74,890
108,247
\u2014
108,247
Term deposits
\u2014
152,385
152,385
\u2014
89,053
89,053
Loans obtained
\u2014
293,387
293,387
\u2014
399,678
399,678
CIRS and IRS operations collateralised
by deposits (*)
92,299
\u2014
92,299
19,998
\u2014
19,998
Other resources
\u2014
4,186
4,186
\u2014
5,704
5,704
167,189
449,958
617,147
128,245
494,435
622,680
259,682
1,208,678
1,468,360
224,899
8,671,175
8,896,074
", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromBanksExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-678": { "value": "Resources from credit institutions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Resources and other financing
from Central Banks
Bank of Portugal
\u2014
592,740
592,740
\u2014
8,028,747
8,028,747
Central Banks abroad
\u2014
14,736
14,736
\u2014
82,155
82,155
\u2014
607,476
607,476
\u2014
8,110,902
8,110,902
Resources from credit institutions in
Portugal
Sight deposits
92,493
\u2014
92,493
96,654
\u2014
96,654
Term Deposits
\u2014
151,244
151,244
\u2014
64,217
64,217
CIRS and IRS operations collateralised
by deposits (*)
\u2014
\u2014
\u2014
\u2014
1,620
1,620
Other resources
\u2014
\u2014
\u2014
\u2014
1
1
92,493
151,244
243,737
96,654
65,838
162,492
Resources from credit institutions
abroad
Repayable on demand
74,890
\u2014
74,890
108,247
\u2014
108,247
Term deposits
\u2014
152,385
152,385
\u2014
89,053
89,053
Loans obtained
\u2014
293,387
293,387
\u2014
399,678
399,678
CIRS and IRS operations collateralised
by deposits (*)
92,299
\u2014
92,299
19,998
\u2014
19,998
Other resources
\u2014
4,186
4,186
\u2014
5,704
5,704
167,189
449,958
617,147
128,245
494,435
622,680
259,682
1,208,678
1,468,360
224,899
8,671,175
8,896,074
Subordinated debt
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Bonds
Non-Perpetual
1,376,856
1,383,821
Interests to pay
(72,040)
(4,530)
Corrections to the value of liabilities subject to hedging operations
(2,436)
(2,709)
Deferred cost expenses
30,676
18,198
1,333,056
1,394,780
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following: mid-swap rate\u00a0 in force at the beginning of this period + 4.267%;
(ii) Annual interest rate of 3.871% during the first 5.5 years (corresponding to a spread of 4.231% over the 5.5-year mid-swap rate, for
the remaining 5 years will be applied over the mid-swap rate in force at the beginning of that period).
(iii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the
mid-swap rates of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the
5-year mid swaps rate prevailing at that time plus the Spread.
The analysis of the subordinated debt by remaining period, is as follows:
(Thousands of euros)
2022
2021
1 to 5 years
314,519
\u2014
Over 5 years
1,018,537
1,394,780
1,333,056
1,394,780
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
", "dimensions": { "concept": "ifrs-full:DisclosureOfBorrowingsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-679": { "value": "Resources from customers and other loans
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Non-interest
bearing
Interest
bearing
Total
Non-interest
bearing
Interest
bearing
Total
Deposits from customers
Repayable on demand
48,490,922
182,647
48,673,569
48,771,241
176,561
48,947,802
Term deposits
\u2014
19,816,079
19,816,079
\u2014
14,241,514
14,241,514
Saving accounts
\u2014
6,315,759
6,315,759
\u2014
5,912,193
5,912,193
Treasury bills and other assets
sold under repurchase agreement
\u2014
\u2014
\u2014
\u2014
28,718
28,718
Cheques and orders to pay
564,369
\u2014
564,369
369,802
\u2014
369,802
Other
\u2014
60,367
60,367
\u2014
60,198
60,198
49,055,291
26,374,852
75,430,143
49,141,043
20,419,184
69,560,227
In the terms of the Law, the Deposit Guarantee Fund was established to guarantee the reimbursement of funds
deposited in Credit Institutions. The criteria to calculate the annual contributions to the Portuguese fund are defined in
the Regulation no. 11/94 of the Bank of Portugal.
This balance is analysed, by remaining period until the next operation renewal date, as follows:
(Thousands of euros)
2022
2021
Deposits repayable on demand
48,673,569
48,947,802
Term deposits and saving accounts
Up to 3 months
14,069,453
10,785,617
3 to 6 months
7,034,909
5,999,221
6 to 12 months
3,921,351
2,784,000
1 to 5 years
1,106,125
584,717
Over 5 years
\u2014
152
26,131,838
20,153,707
Treasury bills and other assets sold under repurchase agreement
Up to 3 months
\u2014
28,718
\u2014
28,718
Cheques and orders to pay
Up to 3 months
564,369
369,802
564,369
369,802
Other
Up to 3 months
367
198
Over 5 years
60,000
60,000
60,367
60,198
75,430,143
69,560,227
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
", "dimensions": { "concept": "ifrs-full:DisclosureOfDepositsFromCustomersExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-680": { "value": "Subordinated debt
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Bonds
Non-Perpetual
1,376,856
1,383,821
Interests to pay
(72,040)
(4,530)
Corrections to the value of liabilities subject to hedging operations
(2,436)
(2,709)
Deferred cost expenses
30,676
18,198
1,333,056
1,394,780
(*) Amount of subordinated loans, eligible as Level 2 own funds, in accordance with Articles 62 a), 63 to 65, 66 a) and 67 of the CRR.
References - Interest rate:
(i) up to the 5th year fixed rate 4.5%; 6th year and following: mid-swap rate\u00a0 in force at the beginning of this period + 4.267%;
(ii) Annual interest rate of 3.871% during the first 5.5 years (corresponding to a spread of 4.231% over the 5.5-year mid-swap rate, for
the remaining 5 years will be applied over the mid-swap rate in force at the beginning of that period).
(iii)\u00a0 Interest rate of 4%, per annum, during the first 5 years and 6 months (corresponding to a spread of 4.065% over the average of the
mid-swap rates of 5 and 6 years). At the end of the first 5 years and 6 months the interest rate will be reset to maturity based on the
5-year mid swaps rate prevailing at that time plus the Spread.
The analysis of the subordinated debt by remaining period, is as follows:
(Thousands of euros)
2022
2021
1 to 5 years
314,519
\u2014
Over 5 years
1,018,537
1,394,780
1,333,056
1,394,780
", "dimensions": { "concept": "ifrs-full:DisclosureOfSubordinatedLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-681": { "value": "Financial liabilities held for trading
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Short selling securities
1,022
3,625
Trading derivatives (note 23)
\u00a0 Swaps
170,157
217,587
\u00a0 Options
7,414
1,478
Embedded derivatives
53,495
6,365
Forwards
9,418
2,186
240,484
227,616
241,506
231,241
Level 2
186,130
221,040
Level 3
55,376
10,201
As referred in IFRS 13, financial instruments are measured according to the levels of valuation described in note 49. The
balance Financial liabilities held for trading includes, as at 31 December 2022, the embedded derivatives valuation
separated from the host contracts in accordance with the accounting policy presented in note 1 C5. in the amount of
Euros 53,495,000 (31 December 2021: Euros 6,365,000). This note should be analysed together with note 24.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialLiabilitiesHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-682": { "value": "Financial liabilities designated at fair value through profit or loss
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Deposits from customers (*)
476,671
\u2014
Certificates
850,681
961,730
Debt securities at fair value through profit and loss
Medium term notes (MTN)
490,326
620,048
1,817,678
1,581,778
As at 31 December 2021, the analysis of this balance, by remaining period, is as follows:
(Thousands of euros)
2021
Up to
3 months
3 months to
6 months
6 months to
1 year
1 year to
5 years
Over 5
years
Total
Certificates
\u2014
\u2014
\u2014
\u2014
961,730
961,730
Debt securities at fair value through
profit and loss
MTN
13,781
606,267
\u2014
620,048
13,781
\u2014
\u2014
606,267
961,730
1,581,778
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialInstrumentsDesignatedAtFairValueThroughProfitOrLossExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-683": { "value": "Provisions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Provision for guarantees and other commitments
110,754
110,649
Other provisions for liabilities and charges
451,032
348,095
561,786
458,744
Changes in Other provisions for liabilities and charges are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
348,095
207,691
Transfers resulting from changes in the Group's structure
\u2014
(30)
Transfers to Impairment of investments in associates
(Banco Millennium Atl\u00e2ntico, S.A.) (note 26)
\u2014
(22,300)
Other transfers
(5,504)
4,596
Charge of the year for restructuring costs (note 7)
4,414
84,152
Charge for the year (note 13)
569,226
651,156
Reversals for the year (note 13)
(1,854)
(16,566)
Amounts charged-off
(116,874)
(135,506)
Allocation to loan's portfolio (note 22)
(344,052)
(443,296)
Exchange rate differences
(2,419)
18,198
Balance at the end of the year
451,032
348,095
estimate of the amount and respective probability of payment.
This balance includes provisions for lawsuits, frauds and tax contingencies. As at 31 December 2022, the provisions
constituted to cover tax contingencies totalled Euros 38,311,000 (31 December 2021: Euros 37,524,000) and are
associated, essentially, to contingencies related to VAT and Stamp Duty.
Additionally, there are provisions for liabilities and charges recorded for corporate restructuring funds and carved-out
assets of the Project Crow, completed in December 2022.
In 2021, the Bank's Board of Directors approved in April the employee reduction plan. The decision was taken based on
a thorough analysis of needs and existing capacity, considering the specifics of the Bank, the changes in behaviour and
needs of customers, the impact of new technologies on business models and processes, as well as the developments
that are expected for the Bank.
The implementation of this plan started in mid-June 2021, having been contacted throughout the 3rd quarter of 2021
all employees covered by the program, which included early retirements and terminations. For diverse reasons, the
effective departure of some Employees was agreed for dates during the first half of 2022.
In view of the initiatives that had already been developed on 30 June 2021, the Bank considered that the requirements
defined in IAS 37 - Provisions, Contingent Liabilities and Contingent Assets for the recognition of restructuring costs in
its accounts for the first half of 2021 were met. Thus, in the first half of 2021, was recorded\u00a0 in personnel costs, a
provision for restructuring costs in the amount of Euros 81,373,000, which was reinforced in December in the amount of
Euros 2,779,000, which makes a total of Euros 84,152,000 in 2021 (note 7). As at 31 December 2021, the balance of the
provision for restructuring costs amounted to Euros 4,692,000, of which Euros 2,297,000 are referred to agreements
already concluded with some employees whose effective departures have been occur during the first half of 2022 and
Euros 2,395,000 are referred to future costs with the health protection of former Employees, who left the Bank as part
of the employees' reduction process developed in 2021.
As at December 2022, the balance of this provision amounts to Euros 4,893,000, which was reinforced in the amount of
Euros 4,414,000 (note 7), referring to agreements already concluded with some employees whose effective departures
will occur during the first half of 2023. In 2022, the Bank also has written-off the\u00a0 amount of Euros 4,213,000, of which
Euros 3,443,000 corresponds to costs with the employee's departures and Euros 770,000 refers to costs with health
protection of former Employees.
Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium (Poland)
In 2021, Bank Millennium changed the accounting policy regarding the recognition of provisions for future claims related
to active CHF mortgage loans in the balance sheet. As a result of changes in market conditions, such as the growing
number of unfavourable court judgments declaring the entire agreement or certain provisions of these credits to be
invalid, the Bank does not expect that all contractual cash flows related to these loans will be recovered. As a result,
Bank Millennium allocates provisions for future claims and recognizes them as a reduction of the gross carrying amount
of loans for which a decrease in future cash flows is expected, in accordance with paragraph B5.4.6 of IFRS 9 \"Financial
Instruments\" (previously provisions for future claims used to be recognized in accordance with IAS 37 \"Provisions,
Contingent Liabilities and Contingent Assets\"). As a result of the above change, the approach applied in accordance
with IAS 37 will be continued only regarding claims relating to already repaid (or almost fully repaid) receivables not
recognised in Bank Millennium's balance sheet.
As at 31 December 2022, the Loans and advances to customers portfolio in CHF has a gross amount of Euros
2.477.851,000 (31 December 2021: Euros 2,817,504,000).
As at 31 December 2022, the provisions estimated by Bank Millennium to address the legal risk related to foreign
currency-indexed mortgage loans amount to Euros 1,152,457,000 (PLN 5,395,344,000)), of which Euros 976,782,000
(PLN 4,572,901,000) are presented under assets, as a deduction from the gross amount of the loan portfolio in CHF
(note 22) and Euros 175,676,000 (PLN 822,443,000) are presented under Provisions.\u00a0
With reference to 31 December 2021, the provisions estimated by Bank Millennium to address the legal risk related to
foreign currency-indexed mortgage loans amounted to Euros 727,026,000 (PLN 3,332,614,000), of which Euros
636,309,000 (PLN 2,916,778,000) were presented under assets, as a deduction from the gross amount of the loan
portfolio in CHF (note 21) and Euros 90,716,000 (PLN 415,835,000) were presented under Provisions.
The variation in the level of provisions or concrete losses will depend on the final court decisions about each case and
on the number of court cases.
Mozambique's sovereign debt
Following a period of deceleration in economic activity and increase of inflation, reduction of Republic of Mozambique
rating, depreciation of Metical and decrease in foreign direct investment, the Bank of Mozambique has adopted a
restrictive policy, with increases in the reference rate since December 2015, as well as increasing the reserve ratio.
This set of factors constrained commercial banking in Mozambique, pushing it to pursue a strict liquidity management,
emphasis on raising funds, despite contributing to the improvement of net interest income.
According to an International Monetary Fund (IMF) statement dated 23 April 2016, existing debt guaranteed by the State
of Mozambique in an amount over USD 1 billion that had not been disclosed to the IMF. Following this disclosure, the
economic program supported by the IMF was suspended. According to an IMF statement dated 13 December 2016,
discussions were initiated on a possible new agreement with the Government of Mozambique and the terms of
reference for an external audit were agreed.
In June 2017, the Attorney General's Office of the Republic of Mozambique published an Executive Summary regarding
the above-mentioned external audit. On 24 June 2017, the IMF released in a statement that due to the existence of
information gaps in this audit, an IMF mission would visit the country to discuss audit results and possible follow-up
measures. Following this visit, the IMF requested the Government of Mozambique to obtain additional information on
the use of the funds.
On 14 December 2017, in a statement from the IMF staff, after the end of the mission held between 30 November and
13 December 2017, it was reiterated the need for the Mozambican State to provide missing information. In the
statement of the Mozambican Attorney General's Office dated 29 January 2018, it is mentioned, among other things,
that the Public Prosecutor submitted to the Administrative Court, on 26 January 2018, a complaint regarding the
financial responsibility of public managers and companies participated by the State, participants in the execution and
management of contracts for financing, supplying and providing services related to debts not disclosed to the IMF.
In the statements dated of 16 January 2017 and 17 July 2017, the Ministry of Economy and Finance of Mozambique
informed the holders of bonds issued by the Republic of Mozambique specifically \"US$726.524 million, 10.5%, repayable
securities in 2023\" that the interest payment due on 18 January 2017 and 18 July 2017, would not be paid by the
Republic of Mozambique. In November 2018, the Ministry of Economy and Finance of the Republic of Mozambique
announced that it has reached an agreement in principle on the key commercial terms of a proposed restructuring
transaction related to this debt securities with four members of the Global Group of Mozambique Bondholders. The
Bondholders currently own or control approximately 60% of the outstanding Bonds. The agreement in principle reached
by the parties, and the support of the Bondholders for the proposed restructuring, is conditional on the parties reaching
an agreement on mutually satisfactory documentation setting out the detailed terms of the restructuring including
implementation, and the mentioned Ministry obtaining all necessary approvals, including Parliamentary and government
approvals of Mozambique.
On 6 September 2019, the Ministry of Economy and Finance of the Republic of Mozambique announced the approval by
99.95% of the Bondholders of a written decision containing the terms and conditions of the restructuring proposal. The
Group has no exposure to this debt.
In May 2020, the Constitutional Council of the Republic of Mozambique issued a Judgment, declaring the nullity of the
acts related with the loans contracted by Proindicus, SA (\"Proindicus\") and Mozambique Asset Management, MAM, SA
(\"MAM\"), and the respective sovereign guarantees granted by the Government in 2013 and 2014, respectively, and on 19
October 2020, the dissolution of the two companies was registered based on an order issued by the Judicial Court of the
City of Maputo.
In the context of the liquidation of Proindicus and MAM, the Liquidator published, on 3 May 2022, an announcement in
the Jornal de Not\u00edcias de Mo\u00e7ambique, through which the creditors of those companies are notified to submit, within
thirty days counted from the said publication, the supporting documents of their credits. Following the publication of
the said announcement, BIM and BCP submitted, on 1 June 2022, their credit claims on Proindicus and MAM,
respectively.
An action brought on 27 February 2019 and amended on 30 April 2020, by the Republic of Mozambique (represented by
the Attorney General of the Republic) against the arranger and originating lender of the loan to Proindicus and other
entities, by which the Republic of Mozambique requests, inter alia, the declaration of nullity of the sovereign
guarantee of the Mozambican State to the Proindicus loan. Following this lawsuit, on 27 April 2020, the Banco
Internacional de Mo\u00e7ambique (BIM) filed a lawsuit, in the London Commercial Court, against the arranger and lender of
the loan to Proindicus, claiming, inter alia, payment of BIM's exposure to the Proindicus, in the event that the said
sovereign guarantee of the State of Mozambique to Proindicus is, in a court of law declared null and void. Considering
the dependency of this claim in relation with the lawsuit brought by the Republic of Mozambique above mentioned, it is
expected that the judgment sessions of the claim brought by BIM will only take place simultaneously or after the
judgment sessions scheduled for the beginning of October 2023, relating to the lawsuit filed by the Republic of
Mozambique.
Regarding MAM, as far as we are aware, no lawsuit with the same purpose was brought by the Republic of Mozambique
at the London Commercial Court. However, it is expected that, in the context of ongoing legal proceedings, that
several creditors of MAM (including BCP) have filed, at the London Commercial Court, against MAM and the Republic of
Mozambique in order to recover their credits, the question of the validity of the sovereign guarantee of the
Mozambican State to the MAM loan will be raised by the Republic of Mozambique. In July 2021, London Commercial
Court decided that the various lawsuits brought by several creditors of MAM (including BCP) against the Republic of
Mozambique, as guarantor, and MAM, as debtor, as well as the lawsuit brought by the Republic of Mozambique within
the scope of the loan to Proindicus, must be judged through a unitary trial and scheduled the start of the respective
trial sessions for 3 October 2023 and several interim sessions related to the process of collecting and disclosure of
evidence (DRD - Disclosure Review Documents), which is still ongoing.
According to public information made available by the IMF, there are defaults on credits granted to non-state
Mozambican companies' and guaranteed by the Mozambican State. Considering the above-mentioned developments
related to these credits, although the Ministry of Economy and Finance of the Republic of Mozambique has submitted in
November 2018 new proposals regarding this matter and interactions are ongoing between the Government of
Mozambique, the IMF and the creditors with the objective of finding a solution to the aforementioned debt guaranteed
by the State of Mozambique, which had not been previously disclosed to the IMF, a solution that changes the ex-
approved a solution that would change the Group's current expectations, reflected in the financial statements as at 31
December 2022, on: (i) the ability of the Government of Mozambique and public companies to repay their debts and
commitments assumed; and (ii) the development of the activity of its subsidiary Banco Internacional de Mo\u00e7ambique
(BIM).
As at 31 December 2022, considering the 66.7% indirect investment in BIM, the Group's interest in BIM's equity
amounted to Euros 347,559,000 (31 December 2021: Euros 372,708,000), with the exchange translation reserve
associated with this participation, accounted in Group's consolidated equity, in a negative amount of Euros 139,373,000
(31 December 2021: negative amount of Euros 162,561,000). BIM's contribution to consolidated net income for 2022,
attributable to the shareholders of the Bank, amounts to Euros\u00a0 70,707,000 (2021: Euros 63,729,000).
As at 31 December 2022, the subsidiary BIM's exposure to the State of Mozambique and to the Central Bank includes
public debt securities denominated in Metical classified as Financial assets measured at amortised cost - Debt
instruments in the gross amount of MZN 57,909,918,000 corresponding to Euros 849,306,000 (31 December 2021: MZN
72,710,220,000 corresponding to Euros 997,397,000) and Financial assets at fair value through other comprehensive
income in the gross amount of MZN 7,172,774,000 corresponding to Euros 105,196,000 (31 December 2021: MZN
4,359,808,000 corresponding to Euros 59,805,000).
Additionally, the Group has also registered as at 31 December 2022, in the balance Loans and advances to customers, a
direct gross exposure to the Mozambican State in the amount of MZN 19,081,523,000 corresponding to Euros
279,849,000 (31 December 2021: MZN 20,380,268,000 corresponding to Euros 279,567,000) and in the balance
Guarantees granted revocable and irrevocable commitments, an amount of MZN 4,818,871,000 corresponding to Euros
70,704,000 (31 December 2021: MZN 6,318,155,000 corresponding to Euros 86,904,000).\u00a0
Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37 are the
following:
1. In 2012, the Portuguese Competition Authority (\"PCA\") initiated an administrative proceeding relating to competition
restrictive practices (no. PRC 2012/9). On 6 March 2013, unannounced inspections were conducted in the premises of
Banco Comercial Portugu\u00eas, S.A. (\"BCP\" or \"Bank\") and other credit institutions, where documentation was seized to
investigate allegations of a commercially sensitive information exchange between Portuguese banks.
The administrative proceeding was subject to judicial secrecy by the PCA, as the publicity of the process would not be
compatible with the interests of the investigation and with the rights of the investigated companies. On 2 June 2015,
the Bank was notified of the PCA\u2019s statement of objections (\u201cSO\u201d) in connection with the administrative offence no.
2012/9, by which the Bank is accused of participating in a commercially sensitive information exchange between other
fourteen banks related to retail credit products, namely housing, consumer and small and medium enterprises credit
products.
The proceedings, including the deadline to submit a response to the SO, were suspended for several months between
2015 and 2017, following the appeals lodged by some defendants (including the Bank) before the Portuguese
Competition, Regulation and Supervision Court (\u201cCompetition Court\u201d) on procedural grounds (namely, on the right to
have access to confidential documents which were not used as evidence by the Authority \u2013 for several months, the PCA
denied the Defendant\u2019 right to have access to confidential documents not used as evidence). In the end of June 2017,
the suspension on the deadline to reply to the SO was lifted.
On 27 September 2017, BCP submitted its reply to the statement of objections. A non-confidential version of the Bank\u2019s
defense was sent to the PCA, at the latter\u2019s request, on 30 October 2017. The witnesses indicated by the Bank were
interrogated by the PCA in December 2017 (although without the presence of BCP\u2019s legal representatives).
In May 2018, the PCA refused the BCP\u2019s application for confidential treatment of some of the information in the Bank\u2019s
reply to the SO, having also imposed that the Bank protects the confidential information of the co-defendants
(providing a summary of the information). On 1 June 2018, the Bank filed an appeal with the Competition Court, which,
upholding the appeal, concluded that the PCA infringed on the right to a prior hearing. Complying with the judgment,
in November 2018, the PCA notified the Bank of its intention to deny the application for confidential treatment of some
of the information included in the Bank\u2019s defence; subsequently, in January 2019, it requested BCP to provide
summaries for the co-defendants\u2019 confidential information. The Bank filed an appeal before the Competition Court,
which ruled in favor of BCP, as it considered that the elaboration by the Bank of summaries for its co-defendants\u2019
confidential information an illegitimate burden.
In April 2019, at the PCA\u2019s request, BCP declared to be in favor of the re-examination of its witnesses, requested in its
defense and previously held. The witnesses were re-inquired on 16-17 April 2019 with the presence of the Bank\u2019s legal
representatives.
The PCA denied the request of BCP to be allowed to conduct cross-examination of the witnesses appointed by its co-
defendants. The Bank appealed to the Competition Court, which denied the appeal, through a decision which was latter
upheld by the Lisbon Court of Appeal. BCP then lodged an appeal before the Portuguese Constitutional Court for breach
of the constitutional right of defence. The Constitutional Court dismissed the appeal on 29 April 2021, on the grounds
that the requested cross-examination was not required by the Portuguese Constitution, at that stage of the
proceedings. On 12 August 2020, the Bank lodged a complaint before the European Court of Human Rights on this
matter.
On 2 July 2019, the Bank submitted its observations to the PCA\u2019s report on complementary evidence measures.
On 3 June 2019, BCP was notified of the partial dismissal of the complementary evidence measures it had requested in
its reply to the SO, which it judicially contested. By judgment of September 2019, the Competition Court declared the
nullity of the PCA\u2019s decision, for breach of the right of the parties to be heard on the PCA\u2019s draft decision. The Bank
appealed to the Lisbon Court of Appeal in what concerned the limitation by the Competition Court of the effects of the
nullity declaration of the PCA\u2019s decision. Although this appeal was ultimately admitted by the panel of judges of the
Lisbon Court of Appeal, it ends up being denied.
In order to give compliance to BCP\u2019s right to be heard, the PCA notified the BCP of its intention to reject the above-
mentioned complementary evidence measures. Following BCP\u2019s observations in November 2019, the PCA adopted its
final decision rejecting the measures, which was judicially contested by the BCP in December 2019. In March 2020, the
Competition Court rejected the appeal. This judgment was upheld by the Lisbon Court of Appeal in October 2020.
On 9 September 2019, the PCA adopted its final decision in this proceeding, fining the Bank in a Euros 60 million fine
for its alleged participation in an information exchange system with its competitors in the housing, consumer and SME
credit segments. The BCP considers that the Decision contains serious factual and legal errors, having, on 21 October
2019, filed an appeal before the Competition Court requesting the annulation of the Decision and the suspensory effect
of the appeal. On 8 May 2020, BCP\u2019s appeal was admitted. On 8 June 2020, the BCP submitted a request before the
Court, claiming that the rule according to which appeals do not have, in principle, suspensory effect violates the
Portuguese Constitution, submitting elements aimed at demonstrating considerable harm in the advance provisional
payment of the fine, and offering a guarantee in lieu (indicating the respective percentage of the fine to be offered as
a guarantee). On 14 December 2020, a hearing was held before the Competition Court, and a consensual solution was
reached between the PCA and the defendant banks, including BCP, as to the dosimetry (i.e., 50% of the amount of the
fine) and the forms of the guarantee to be provided, in order for the appeal of the PCA\u2019s decision to have suspensory
effect. On 21 December 2020, BCP submitted a bank guarantee issued by the BCP, which was accepted by the
Competition Court. On 1 March 2021, the Competition Court notified BCP that the guarantee had been presented in a
timely manner and in the agreed form, and, as a result, attributed suspensory effect to the appeal. By order of 20
March 2021, the Competition Court lifted the judicial secrecy and informed the appellants that the trial would, in
principle, start in September 2021.
On 9 July 2020, the BCP requested the Court to declare the nullity of the fining decision of the PCA for failure to assess
the economic and legal context, as determined by the recent case-law of the Court of Justice of the European Union.
The Competition Court clarified that this and other prior questions would not be assessed before the hearing phase.
On 13 January 2021, BCP was notified of an application submitted by \"Associa\u00e7\u00e3o Ius Omnibus \u2013 Nova Associa\u00e7\u00e3o de
Consumidores\" to the Competition Court asking it to have access to a non-confidential version of the file, based on the
need to assert the \u201crights to indemnification of the consumers whose rights and interests it represents, and the possible
exercise and proof of those rights in the context of an action for damages\u201d. On the same date, BCP was notified by the
Competition Court of its decision authorizing the news agency \"Lusa\" to access the file of the administrative phase of
the case. BCP appeal of this decision to the Appeal Court of Lisbon, on 25 January 2021 and opposed to the request of
\"Ius Omnibus\" on 2 February 2021.
On 20 March 2021, the Competition Court determined: (i) the lifting of the judicial secrecy; (ii) the forwarding to the
Public Prosecutor of the appeal of BCP against the decision of the Competition Court relating to \"Lusa\", for reply; (iii)
the provisional start date of the judgement hearing on September 2021, having requested suggestions by the co-
appellants for venues.
By decision of 9 April 2021 of the Competition Court, a preparatory hearing took place on 30 April 2021 for discussion of
issues precedent to the begging of the judgment hearings, in which the procedures relating to the treatment of
confidential information of the co-appellants in the appeals was defined, as well as the conditions relating to access to
file. The Competition Court also set forth preliminary dates for the judgement hearing and scheduled a preparatory
hearing for 7 July 2021.
On 28 June 2021, BCP was notified by the Competition Court to reply to the requests submitted by some of the co-
appellants and confirm that all confidential information had been duly eliminated from non-confidential versions
submitted by each co-appellant. The Competition Court also determined that the hearing of 7 July 2021 was cancelled
and its object would be transferred to the next hearing date (6 September 2021).
On 8 July 2021, BCP presented its reply to the notification of 28 June 2021, having also requested confirmation in
relation to the scheduling of the judgement hearing, namely confirmation of whether it was actually scheduled for 6
September 2021 the preparatory hearing and the start of the judgement hearing sessions.
Several representatives of the banks raised the question of the possible unconstitutionality of the seizure proceedings
of e-mail messages used as evidence in the PCA\u2019s decision, which objection appeal will now take place. This issue was
raised bearing in mind the recent Decision of the Constitutional Court no. 687/2021 on the administrative offence case
no. 225/15.4YUSTR-W. A petition on this matter was filed with the Court on 10 October 2021, requesting the Court to
take a position on the matter before the beginning of the trial. The Court issued an order rejecting the banks' request
to rule on those nullities raised by them, having refused to prohibit the use during the judgment of electronic messages
seized, allowing witnesses to be confronted with their content. The requesting banks lodged an appeal against this
order, which was admitted by the Lisbon Court of Appeal.
On 28 April 2022, TCRS (\"Tribunal da Concorr\u00eancia, Regula\u00e7\u00e3o e Supervis\u00e3o\") handed down a decision under the scope
of Proc. 225/15.4YUSTR-W, regarding the appeal to challenge the decision of the Portuguese Competition Authority of
September 2019 (PRC/2012/09), which imposed fines on a number of banking institutions for alleged violation of
competition rules in virtue of participating in a process of exchanging information on mortgage loans, consumer credit
and credit to SMEs.
In this extensive decision, TCRS lists the facts given as proven, bearing in mind the testimonial evidence produced and
the documents attached to the case file, both in the administrative phase and in the trial, however, at this stage, the
TCRS does not yet conclude by the legal framework of the facts as proven, nor, consequently, by the imposition of
fines, having the TCRS instead chosen to make the reference for a preliminary ruling to the Court of Justice of the
European Union (CJEU) in order to answer two preliminary questions that it sets out, requesting that this reference
follows further terms in the form of an accelerated procedure, taking into account the risk of prescription. It should be
noted that it is not up to the CJEU to adjudicate on the case, but only to interpret the rules of community law by
answering in abstract to the questions submitted to it by the referring court.
CJEU rejected TCRS's request for an accelerated procedure and for priority to be given in the assessment of this case,
hence CJEU's assessment must be given within the normal deadline for these prejudicial proceedings, after which the
judgment of this Court will then be concluded.
The Bank has been notified by the CJEU to, if it wishes, submit its written observations, and must do so by 2 September
2022.
The Bank forwarded its observations to the CJEU on 1 September 2022.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and Jos\u00e9
Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo Banco, S.A.
and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the defendant
banks and the financial system, without which they would have sold the pledged shares and paid their loans. If this is
not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to Funda\u00e7\u00e3o Jos\u00e9 Berardo
for damages caused by breach of contract, since the moment when they should have been sold in execution of the
pledge due to failure to verify coverage ratios until the moment\u00a0 when they were sold, that is, the difference between
the price at which the pledged shares would have been sold on the dates of coverage ratios default and the price at
which they were actually sold, plus interest and all other loan charges since those dates, in any case the global amount
of compensation not being less than Euros 800,000,000. In any case, the plaintiffs ask the defendant banks to be jointly
condemned to pay Jos\u00e9 Manuel Rodrigues Berardo compensation for moral damages, in the already calculated amount
of Euros 100,000,000 and also in the amount that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of Ministers,
published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9 Berardo, was
declared extinct.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
3. On 3 January 2018, Bank Millennium received decision of the Chairman of the Office for Protection of Competition
and Consumers (OPCC), in which the OPCC Chairman found infringement by Bank Millennium of the rights of consumers.
In the opinion of the OPCC Chairman the essence of the violation is that Bank Millennium informed consumers (it
regards 78 agreements) in responses to their complaints, that the court verdict stating the abusiveness of the provisions
of the loan agreement regarding exchange rates does not apply to them. According to the position of the OPCC
Chairman the abusiveness of contract\u2019s clauses determined by the court\u00a0 in the course of abstract control is
constitutive and effective for every contract from the beginning. As a result of the decision, Bank Millennium was
obliged to:
1) send information on the UOKiK\u2019s decision to the said 78 clients;
2) place the information on\u00a0 decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (Euros 4.42 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium appealed
against the judgment within the statutory deadline. The court presented the view that the judgment issued in the
course of the control of a contractual template (in the course of an abstract control), recognizing the provisions of the
template as abusive, determines the abusiveness of similar provisions in previously concluded contracts. Therefore, the
information provided to consumers was incorrect and misleading. As regards the penalty imposed by OPCC, the court
pointed out that the policy of imposing penalties by the Office had changed in the direction of tightening penalties and
that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the perspective
of today's case-law views on the importance of abstract control (it was not until January 2016 that the Supreme Court's
resolution supporting the view of the OPCC Chairman was published), the more penalties for these behaviours should
not be imposed using current policy. The above constitutes a significant argument against the validity of the judgment
and supports the appeal which Bank Millennium submitted to the Court of second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is positive.
Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC Chairman
recognized the practice of participating banks, including Bank Millennium, in an agreement aimed at jointly setting
interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of competition, and
by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2 million (Euros 2.61
million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection. Bank Millennium has created a provision in the amount equal to the imposed penalty.
4. On 22 September 2020, Bank Millennium received decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman) recognising clauses stipulating principles of currency exchange applied in
the so-called anti-spread annex as abusive and prohibited the use thereof.
Penalty was imposed upon Bank Millennium in the amount of PLN 10.5 million (Euros 2.24 million). Penalty amount
takes account of two mitigating circumstances: cooperation with the Office for Protection of Competition and
Consumers and discontinuation of the use of provisions in question.
Bank Millennium was also requested, after the decision becomes final and binding, to inform consumers, by registered
mail, to the effect that the said clauses were deemed to be abusive and therefore not binding upon them (without need
to obtain court\u2019s decision confirming this circumstance) and publish the decision of the case on Bank Millennium\u2019s
website.
In the decision justification delivered in writing the OPCC Chairman stated that FX rates determined by Bank Millennium
were determined at Bank Millennium\u2019s discretion (on the basis of a concept, not specified in any regulations, of average
inter-bank market rate). Moreover, client had no precise knowledge on where to look for said rates since provision
referred to Reuters, without precisely defining the relevant site.
Provisions relating to FX rates in Bank Millennium\u2019s tables were challenged since Bank Millennium failed to define when
and how many times a day these tables were prepared and published.
In justification of the decision, the OPCC Chairman also indicated that in the course of the proceeding, Bank Millennium
presented various proposed solutions, which the OPCC Chairman deemed to be insufficient.
The decision is not final and binding. Bank Millennium appealed against the said decision within statutory term.
On 31 March 2022, the first instance court revoked the entire decision of the Chairman of the OPCC. On 23 May 2022,
the Chairman of the OPCC filed an appeal. On 26 October 2022, the Court of Appeal changed the judgment of the court
of first instance and shared the position of the Chairman of the OPCC as to the abusiveness of the provisions regarding
the determination of exchange rates in the annexes concluded with foreign currency borrowers. On 21 November 2022,
the Court of Appeal, at the request of Bank Millennium, suspended the execution of the judgment until the end of the
cassation proceedings. Bank Millennium filled a cassation appeal to the Supreme Court.
5. As at 31 December 2022, the most important proceedings, in the group of the court cases where the Group\u2019s
companies are defendant, are following:
- Bank Millennium is a defendant in three court proceedings in which the subject of the dispute is the amount of the
interchange fee. In two of the abovementioned cases, Bank Millennium was sued jointly and severally with another
bank, and in one with another bank and card organizations. The total value of claims submitted in these cases is PLN
729.6 million (Euros 155.84 million). The proceedings with the highest value of the submitted claim are brought by PKN
Orlen SA, in which the plaintiff demands payment of PLN 635.7 million (Euros 135.79 million). The plaintiff in this
proceeding alleges that the banks acted under an agreement restricting competition on the acquiring services market
by jointly setting the level of the national interchange fee in the years 2006-2014. In the other two cases, the charges
are similar to those raised in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated
for the years 2008-2014. According to current estimates of the risk of losing a dispute in these matters, Bank Millennium
did not create a provision. In addition, we point out that Bank Millennium participates as a side intervener in four other
proceedings regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks
of acting as part of an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2008-2014.
- A lawsuit brought up by Europejska Fundacja Wsp\u00f3\u0142pracy Polsko-Belgijskiej/European Foundation for Polish-Belgian
Cooperation (EFWP-B) against Bank Millennium S.A., worth of the dispute PLN 521.9 million (Euros 111.48 million) with
statutory interest from 5 April 2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the
Regional Court in Warsaw; the suit\u00a0 was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis
for the claim is damage to their assets, due to the actions taken by Bank Millennium and consisting in the wrong
interpretation of the Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which
resulted in placing the loan on demand. In the case brought by EFWP-B, the plaintiff moved for securing the claim in
the amount of PLN 250.0 million (Euros 53.40 million). The petition was dismissed on 5 September 2016 with legal
validity by the Appellate Court. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with
the charges raised in the claim. Supporting the position of Bank Millennium, Bank Millennium\u2019s attorney submitted a
binding copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state
in the action brought by PCZ SA against Bank Millennium. At present, the Court of first instance is conducting evidence
proceedings.
As at 31 December 2022, the total value of the subjects of the other litigations in which the Group\u2019s companies\u00a0
appeared as defendant, stood at PLN 3,876.4 million (Euros 828.01 million) (excluding the class actions described below
and in note 57). In this group the most important category are cases related with FX loans mortgage portfolio and cases
related to forward transactions (option cases).
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors (454
borrowers party to 275 loan agreements) is represented by the Municipal Consumer Ombudsman in Olsztyn. The
plaintiffs demanded payment of the amount of PLN 3.5 million (Euros 0.75 million), claiming that the clauses of the
agreements, pertaining to the low down payment insurance, are unfair and thus not binding. Plaintiff extended the
group in the court letter filed on 4 April 2018, therefore the claims increased from PLN 3.5 million (Euros 0.75 million)
to over PLN 5 million (Euros 1.07 million).
Actual status:
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings and
submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The value of
the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (Euros 1,574,484.78).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff and
decided to take witness evidence in writing and called on the parties to submit questions to the witnesses. Bank
Millennium submitted a pleading with questions to witnesses in July 2020. Currently, the court is collecting written
testimony from witnesses. The date of the hearing has not been set at the moment.
As at 31 December 2022, there were also 218 individual court cases regarding LTV (loans-to-value) insurance (cases in
which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial Ombudsman, in
the lawsuit, demands that Bank Millennium and the Insurer (TU Europa) be ordered to discontinue performing unfair
market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its website, information on use of
unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts. Nonetheless, if
the practice is deemed to be abusive it may constitute grounds for future claims to be filed by individual clients.
The case is being examined by the court of first instance.
8. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to Euros 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -, filed
against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they acted
pursuant to a request made by the Bank for the making of the respective purchases, and also that the court orders the
cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due to
relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs and to
refund them the cost they incurred while complying with that mandate, namely, Euros 90,483,816.83 regarding Banco
Esp\u00edrito Santo, S.A. (BES) and Euros 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD), plus default
interests;
d) the amount of the lawsuit determined by the plaintiffs is Euros 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff company
in the amount of Euros 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report was submitted. There is a deadline for completing and concluding
the expert report, in its final version, since the Bank presented a complaint about various aspects of the expert's
report, in its first version.
9. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal applied a
resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the Decree-law no.
298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial transfer of
assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo Banco, S.A. (Novo
Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope of this process, the
Resolution Fund made a capital contribution to Novo Banco amounting to Euros 4,900 million, becoming, on that date,
the sole shareholder. Further, in accordance with information published on the Resolution Fund\u2019s website, the
Resolution Fund borrowed Euros 4,600 million, of which Euros 3,900 million were granted by the Portuguese State and
Euros 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities emerging from
the \u201ceventual negative effects of future decisions regarding the resolution process that may result in liabilities or
contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken, following
the publication of the report on the result of the independent evaluation, made to estimate the level of credit recovery
for each category of creditors under a hypothetical scenario of a normal insolvency process of BES on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would hypothetically
take if BES had gone into liquidation right before the application of the resolution measure, such creditors shall be
entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the total
acknowledged credits, including capital, remunerative and default interest amounts to Euros 5,056,814,588, of which
Euros 2,221,549,499 are common credits and Euros 2,835,265,089 are subordinated claims, and no guaranteed or
privileged claims exist. Both the total number of acknowledged creditors and the total value of the acknowledged
credits and their ranking will only be ultimately determined upon the definitive judicial judgment of the verification
and ranking of credits to be given in the liquidation proceedings.
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed and is
underway. According to note 20 of the Resolution Fund\u2019s annual report of 2021, \u201cLegal actions related to the
application of resolution measures have no legal precedents, which makes it impossible to use case law in its
evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026) The Resolution
Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and procedural
information available so far, considers that there is no evidence to cast doubt on their belief that the probability of
success is higher than the probability of failure\u201d.
According to note 22 of the Resolution Fund\u2019s annual report of 2021, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction. (...) Regarding litigation in the
Spanish jurisdiction, during the years 2018 to 2021, ten (decisions) have become final and unappealable condemning
Novo Banco, Spanish branch, as well as three sentences in relation to which due compensation has been requested
from the Resolution Fund\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco de
Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently signed
the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a total of Euros
1,000 million in Novo Banco, of which Euros 750 million at completion and Euros 250 million within a period of up to 3
years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco and the Resolution
Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the performance
of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
If these conditions are met, the Resolution Fund may be called upon to make a payment to Novo Banco for the lesser of
the accumulated losses in the covered assets and the amount necessary to restore the capital ratios at the agreed
levels. Any capital injections to be carried out pursuant to this contingent mechanism are limited to an absolute cap.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align incentives as
well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers no. 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new shareholder
of Euros 750 million, followed by a further capital increase of Euros 250 million by the end of 2017. Upon completion of
the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the purposes of the
resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding the
approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support measures by the
Resolution Fund and the Portuguese State that are part of the sale agreement associated with a total gross book value
of around Euros [10-20] billion(1) that revealed significant uncertainties regarding adequacy in provisioning(2):
(i)Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding costs,
realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a maximum of
Euros 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some additional
conditions(1)(2)(3);
(ii)underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount necessary
(but no more than Euros 400 million). The amount that can be reclaimed by the Resolution Fund under the CCA is
subject to the cap of Euros 3.89 billion(2);
(iii) in case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted by the
Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism (capital
backstop), up to Euros 1.6 billion, provided for in the commitments made by the Portuguese State to ensure the
viability of NB, exists\u201d.
According to Novo Banco\u2019s earnings presentation of December 2022, Novo Banco still has Euros 485 million under the
MCC in addition to the Euros 209 million included in the capital call for 2021. The mechanism is in place until December
2025, date that can be extended, under certain conditions, by one additional year.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has disclosed that
the European Commission intends to consider the restructuring process of Novo Banco as completed. The information
disclosed today confirms the successful restructuring of Novo Banco, resulting from the combined execution of the
restructuring plan agreed in 2017, under the sale transaction conducted by Banco de Portugal, and the sale
agreements, namely the CCA, under which the Resolution Fund transferred to Novo Banco 485 million euros, less than
the maximum amount set in the contract (3,890 million euros). The completion of the restructuring of Novo Banco, in
which the Resolution Fund maintains a 19.31% stake, is also another indicator that Novo Banco should not need to
request any further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that
still may occur regarding the amounts already requested by Novo Banco in relation to past years and that the Resolution
Fund considers that are not due. In the statement issued by Banco de Portugal on the same day, it is also disclosed that
\"The conclusion of the Novo Banco restructuring process also results in the end of the backstop mechanism, which
provided for the possibility, which was always considered remote, of the Portuguese State providing extraordinary
support to Novo Banco in extreme scenarios. This mechanism protected Novo Banco and the national financial system
from more adverse scenarios, which did not materialize. With the end of the backstop, the financial risk for the
Portuguese State is eliminated\".
According to the 2018 Resolution Fund\u2019s annual report, the Resolution Fund and Novo Banco have agreed that a
Verification Agent - an independent entity which is essentially responsible for clarifying any differences that may exist
between Novo Banco and the Resolution Fund regarding the set of calculations inherent to the CCA or regarding the
practical application of the principles stipulated in the contract - is in charge of confirming that the perimeter of the
mechanism is correct and that the balance sheet values of Novo Banco are being correctly reflected in the mechanism,
as well as verifying the underlying set of calculations, namely by confirming the correct calculation of losses and the
reference value of the assets. According to the 2021 Resolution Fund\u2019s annual report, the Resolution Fund follows the
work carried out by the Verification Agent, while specific analyses are being requested.
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or
Tier 1 SREP requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
In its 2021 annual report, the Resolution Fund states that \u201ceventual new requests regarding future periods, with
significant uncertainty regarding the relevant parameters for the calculation of eventual responsibilities, under the
terms of the CCA, are recorded as contingent liabilities\u201d.
The Resolution Fund disclosed on 17 June 2019 a set of clarifications related to the payment due in 2019 under the CCA
with Novo Banco, namely:
- For payments from the Resolution Fund to be made (limited to a maximum of Euros 3,890 million over the lifetime of
the mechanism), losses on the assets under the contingent mechanism should be incurred and the capital ratios of Novo
Banco should stand below the agreed reference thresholds;
- The payment to be made by the Resolution Fund corresponds to the lower of the accumulated losses on the assets
covered and the amount necessary to restore the capital ratios above the minimum reference threshold;
- The reference capital ratios are, in 2017, 2018 and 2019, linked to the regulatory requirements applicable to Novo
Banco (CET1 ratio of 11.25% and Tier 1 ratio of 12.75%), but, as from 2020, the reference ratio will correspond to a
CET1 ratio of 12%;
- The initial reference value of the portfolio comprising the CCA was, as of 30 June 2016, Euros 7,838 million (book
value of the associated assets, net of impairments);
- The value of the portfolio, as at 31 December 2021, amounted to Euros 1.8 billion (book value, net of impairments),
according to Novo Banco\u2019s First Half 2022 report.
According to a notice issued by the Resolution Fund on 4 June 2020, the \"Resolution Fund and Novo Banco have
initiated an arbitration procedure to clarify the treatment that should be given, under the CCA, of the effects of Novo
Banco\u2019s decision to waive the transitional regime it currently benefits from and which aims to reduce the impact of
the introduction of IFRS 9 on credit institutions' own funds. This issue falls within the scope of the implementation of
the CCA, which sets the maximum amount of payments to be made by the Resolution Fund at Euro 3,890 million. Thus,
even if the arbitration procedure were to have an unfavourable outcome for the Resolution Fund's claims, its effects
would fall under the maximum limit of Euros 3,890 million in accordance with the CCA. The above arbitral proceedings
therefore do not represent an additional risk compared to the ceiling of Euros 3,890 million\".
According to Resolution Fund\u2019s annual report of 2021 (Box 1), \"the award of the Arbitration Court, constituted under
the aegis of the International Chamber of Commerce, was known at the end of October 2021, and was favorable to the
Resolution Fund. The Arbitration Court considered that (...) the financial impact on Novo Banco's own funds could not
be covered by the CCM. The value of the dispute at the date of the award amounted to 169 million euros, an amount
that the Resolution Fund would have had to pay to Novo Banco if the Arbitration Court's award had not been
favorable\".
Additionally, regarding the intervention of the Resolution Fund concerning the transitional regime of the
implementation of the dynamic component of IFRS 9, Novo Banco estimates a positive impact on its own funds in the
amount of Euros 171 million (which implies a reduction in the capital requirements that Novo Banco intended to pass on
to the CCM in the amount of Euros 161.6 million). Accordingly, the Resolution Fund initiated a second arbitration
proceeding, also under the aegis of the International Chamber of Commerce, with a view to settling the difference
between the parties. This process is in progress, and it is estimated that an award will be rendered during 2023.
According to a statement by the Resolution Fund on 3 September 2020, following the payment made in May 2019 by the
Resolution Fund to Novo Banco in compliance with the CCA, a special audit determined by the Government was carried
out. Information was presented by the independent entity that carried out the special audit, showing that Novo Banco
has been operating with a strong influence of the vast legacy of non-productive assets, originated in BES, which
resulted in impairment charges and provisions, but have also contributed to rendering Novo Banco\u2019s internal procedures
more robust. Regarding the exercise of the powers of the Resolution Fund under the CCA, the audit results reflect the
adequacy of the principles and the adopted criteria.
According to Resolution Fund\u2019s annual report of 2021, the procedure relating to the payment to Novo Banco regarding
2020 accounts has been concluded, concluding that a payment of Euros 112 million was due to Novo Banco from the
Resolution Fund which had remained pending further verification. Therefore, that amount was paid to Novo Banco, in
December 2021, after the conclusion of the supplementary analysis promoted by the Resolution Fund. This amount,
according to a statement issued by the Resolution Fund on 23 December 2021, was already provisioned, included in the
total amount of the provision (Euros 429,012,629).
According to Resolution Fund\u2019s annual report of 2021, Novo Banco submitted to the International Chamber of
Commerce a request for arbitration to have recognized the right to receive an aggregate amount of Euros 165,441.9
thousand (divestment of Novo Banco's activity in Spain in the amount of Euros 147,441.9 thousand and valuation
differences regarding a set of assets held by Novo Banco in the amount of Euros 18,000 thousand) which the Resolution
Fund considered, and considers, not to merit the coverage of the CCM.
According to Novo Banco\u2019s First Half 2022 report (note 30), Novo Banco adhered to the Special Regime applicable to
Deferred Tax Assets under Law No. 61/2014, of 26 August, according to which, the deferred tax assets recorded until 31
December 2015 can be converted into tax credits when the taxable entity reports an annual net loss, in accordance to
the proportion of the amount of the said net loss to total equity at the individual company level, A special reserve was
established with an amount identical to the tax credit approved, increased by 10%. The conversion rights are securities
that entitle the State to require Novo Banco to increase its share capital by incorporating the amount of the special
reserve and consequently issuing and delivering free of charge ordinary shares. The shareholders have the right to
acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2021 annual report, under the terms of the sale of Novo Banco, the 75% of the share
capital of Novo Banco held by Nani Holdings is not affected by the dilution associated with the Special Regime
applicable to deferred tax assets (REIAD).
According to Resolution Fund\u2019s annual report of 2021, on 17 December 2021, Novo Banco, carried out a capital increase
in the amount of Euros 154,907.3 thousand, through the conversion of the rights that had been attributed to the State
due to the conversion of the deferred tax assets of Novo Banco, into tax credits, with reference to the 2015 tax period,
under the REIAD. As of that date, the State became a shareholder of Novo Banco, having been attributed a participation
corresponding to 1.56% of the share capital. As a result, the participation of the Resolution Fund was diluted from 25%
to 23.44%.
According to Novo Banco\u2019s announcement of 4 November 2022, the share capital increase arising from the conversion of
conversion rights relating to 2016 and 2017 fiscal years issued under the REAID increased the Portuguese State
shareholding to 5.69% and Lone Star kept the 75% share capital of Novo Banco. Only the participation of the Resolution
Fund will be diluted, concomitantly.
Also, according to the Resolution Fund\u2019s 2021 annual report, it is estimated that the aggregate effect of the application
of the REAID will result in the reduction of the participation of the Resolution Fund to 9.05%.
On 3 May 2021, following the request of the Portuguese parliament in October 2020 to review the operations and
management of Novo Banco that led to the need to transfer funds from the Resolution Fund to Novo Banco, the
Resolution Fund announced that the audit report conducted by Tribunal de Contas (\u201cCourt of Auditors\u201d) was released.
The Court of Auditors concluded that the public financing of Novo Banco through the CCA contributed to the stability of
the financial system, particularly as it avoided the bank\u2019s liquidation and reduced systemic risk. According to the
Resolution Fund, the audit does not identify any impediment to the fulfilment of commitments and contracts arising
from BES\u2019s resolution process, initiated in August 2014.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to fail\u201d
and started an urgent resolution process of the institution through the partial or total sale of its activity, which was
completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and obligations of
Banif, formed by the assets, liabilities, off-balance sheet items and assets under management.
The largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of Euros 746 million. The Resolution Fund provided a
guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of which Euros 489
million were provided by the Resolution Fund, which was funded by a loan granted by the State.
According to Oitante's press release on 12 January 2022, \"during 2021, it repaid Euros 160.5 million related to its bond
loan of Euros 746 million, contracted when it was created on 20 December 2015 due to the resolution of Banif\". On 4
July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds issued in
connection with the resolution of BANIF. Oitante's debt, which initially amounted to Euros 746 million, was thus fully
repaid. With the early repayment of the debt, the Resolution Fund's responsibility as guarantor also ceases, as well as
the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the non-
acknowledged creditors. According to the Resolution Fund\u2019s 2021 annual report, the Resolution Fund holds a claim on
Banif of Euros 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF. Under the
judicial liquidation process of Banif, which was initiated following the resolution, the independent evaluator estimates
that the level of recovery of the financial support made available by the Resolution Fund, as having a higher ranking at
the end of the liquidation, should be 7.6%.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal dismissed a
lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de Portugal. In its
decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and assumed other
responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2021, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (Euros 3,900 million); (ii) to finance the absorption of Banif's losses (Euros 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (Euros 430 million plus Euros 850 million of additional funding requested in 2019 and Euros 850
million made available in 2020);
- Other funding granted:
\u2022in 2014 by the institutions participating in the Resolution Fund in the amount of Euros 700 million, in which the
Bank participates, within the scope of BES resolution measure;
\u2022in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up to a
maximum of EUR 429 million;
- Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of Euros 400
million. This underwriting did not take place as the instruments were placed with third party investors as disclosed by
Novo Banco on 29 July 2018;
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a loss
greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralized by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, totally reimbursed, as described above.
- CCA allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions related to the
aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star up to Euros 3.89
billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1 below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the SREP
total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
According to Resolution Fund\u2019s annual report of 2021, contingent liabilities from the CCA are limited to a maximum
aggregate amount of Euros 3,890 million and that the aggregate amount of this contingent liability, which corresponds
to the difference between that maximum amount and the amounts already paid by the Resolution Fund, amounts to
Euros 485 million.
The expectation of the Resolution Fund is that, except for what may eventually result from the pending arbitration
disputes with Novo Banco, no further payments will occur under the CCA. On the other hand, the value of payments
already made may be compensated, under the terms of the contracts, by the eventual recovery of credits that may
occur, to which the value of the shareholding of the Resolution Fund in Novo Banco must be added.
According to note 20 of the Resolution Fund\u2019s 2021 annual report, the Resolution Fund considers that, to date, there
are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the Euros 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution Fund, the
extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet its obligations
through its regular revenues, regardless of the contingencies to which the Resolution Fund is exposed. On the same day,
the Office of the Minister of Finance also announced that increases in the liabilities arising from the materialization of
future contingencies will determine the maturity adjustment of State and bank loans to the Resolution Fund, required
from to maintain the contributory effort required from the banking sector at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco Esp\u00edrito
Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to Euros 4,953
million, of which Euros 4,253 million were granted by the Portuguese State and Euros 700 million were granted by a
group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on the
use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and financial
balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on regular
revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and released on 12
July 2022, \"the repayment of the Euros 2,130 million loans granted by the Portuguese State to the Resolution Fund will
not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or in 2059 (with the use of
the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid in 2062\u201d.
According to a statement issued by the Resolution Fund on 31 December 2021, the Euros 700 million loan to the
Resolution Fund was provided by seven credit institutions (Caixa Geral de Dep\u00f3sitos, Banco Comercial Portugu\u00eas, Banco
BPI, Banco Santander Totta, Caixa Econ\u00f3mica, Montepio Geral, Banco BIC Portugu\u00eas and Caixa Central de Cr\u00e9dito
Agr\u00edcola M\u00fatuo).
On 2 October 2017, by Resolution no. 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to make
available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary, to satisfy
any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-mentioned
resolution further set out that the framework agreement should be subject to a time period that is consistent with the
undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to satisfy said obligations in
due time.
On 31 December 2021, the Resolution Fund's own resources had a negative equity of Euros 7,207.6 million, as opposed
to Euros 7,314.7 million at the end of 2020, according to the latest 2021 annual report of the Resolution Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives proceeds
from the initial and regular contributions from the participating institutions (including the Bank) and from the
contribution over the banking sector (created under Law no. 55-A/2010). It is also provided for the possibility of the
member of the Government responsible for the area of Finance to determine, by ordinance that the participating
institutions make special contributions, in the situations provided for in the applicable legislation, particularly if the
Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law no. 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying, since
2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the occurrence of
the event which creates the obligation to pay the contribution, i.e. on the last day of April of each year, as stipulated
in Article 9 of the referred Decree-Law no. 24/2013, of 19 February, thus the Bank is recognising as an expense the
contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law no. 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 19/2022, published on 15 December 2022, set the base rate for 2023 for the
determination of periodic contributions to the Resolution Fund at 0.029% (0.057% in 2022).
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is not
expected that the Resolution Fund will propose the setting up of a special contribution to finance the resolution
measure applied to BES. Therefore, the potential collection of a special contribution appears to be unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in the
amount of Euros 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to partially
cover for the disbursements made by the RF in respect of resolution measures prior to the date of application of this
Agreement. This amount will have to be reinstated over a period of 8 years (started in 2016) through the periodic
contributions to the SRF. The Single Resolution Fund does not cover undergoing situations with the National Resolution
Fund as at 31 December 2015. The total amount of the contribution attributable to the Group in the financial year of
2022 was Euros 30,400 thousand, of which the Group delivered Euros 25,847 thousand and the remaining was
constituted as irrevocable payment commitment.
During the financial year of 2022, the Group made regular contributions to the Portuguese Resolution Fund in the
amount of Euros 18,668 thousand. The amount related to the contribution on the banking sector in Portugal, registered
in the financial year of 2022, was Euros 43,484 thousand. These contributions were recognized as a cost in the financial
year of 2022, in accordance with IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, to assess the effects on the Resolution Fund due to: (i) the sale of the shareholding in
Novo Banco in accordance with the communication of Banco de Portugal dated 18 October 2017 and the information
provided by the European Commission on this subject under the terms described above, including the effects of the
application of the Contingent Capital Agreement and the Special Regime applicable to Deferred Tax Assets; (ii) the
application of the principle that no creditor of the credit institution under resolution may take on a loss greater than
the one it would take if that institution did not go into liquidation; (iii) additional liabilities or contingencies for Novo
Banco which need to be neutralized by the Resolution Fund; and, (iv) legal proceedings against the Resolution Fund.
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order no. 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a proposal
with respect to the determination of amounts, time limits, payment methods, and any other terms related to the
special contributions to be made by the institutions participating in the Resolution Fund. According to public
communications from both the Resolution Fund and from the Government, there is no indication that any such special
contributions are foreseen.
According to the Resolution Fund\u2019s 2021 annual report, under note 8, \"the Resolution Fund is not obliged to present
positive equity. In case of insufficient resources, the Resolution Fund may receive special contributions, as determined
by the member of the Government responsible for finance, in accordance with article 153-I of the Banking Act,
although no such contributions are expected, in particular after a review of the financing conditions of the Resolution
Fund\", as described in the 2016 Annual Report. The Resolution Fund may also, exceptionally, obtain financial support
from the State, namely through loans or guarantees, as set out in article 153-J of the same regime.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the General
Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding its approval
of the CCA of Novo Banco.
According to Resolution no. 63-A/2021 of 27 May 2021 of the Council of Ministers, a number of national financial
institutions offered to finance the Resolution Fund, under conditions considered as appropriate by it, increasing up to
Euros 475 million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund. The funding costs of the Resolution Fund (from the State and from banks) will continue to be
exclusively borne by periodic revenues, corresponding to the contributions paid by the banking sector. The payment
obligations arising from this loan benefit from a pari passu treatment with the payment obligations of the loans entered
into with the Portuguese State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on
28 August 2014.
According to the Resolution Fund\u2019s 2021 annual report, the payment to Novo Banco was fully funded with resources
from a loan from seven domestic credit institutions, including BCP, to finance payments that are due under the
aforementioned contingent capitalization mechanism, up to a maximum amount of Euros 475 million. Of this amount,
the Resolution Fund used Euros 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period between the
contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be reviewed on 31
December 2026 and, after that, every five-years.
The budgetary amendment necessary to make the payment by the Resolution Fund was authorised by Order of the
Minister of State and Finance dated 31 May 2021.
10. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution adopted
by Bank of Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation adopted by
the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent capitalization
agreement under which the Resolution Fund commits to inject capital in Novo Banco up to Euros 3,9 billion, under
determined circumstances. In the proceedings, the claimants request the declaration of nullity or annulment of those
acts.
The proceedings were filed based on the information contained in the Communication from Bank of Portugal dated 31
March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September 2017. Bank
of Portugal and the Resolution Fund presented their arguments and, only very recently, Nani Holdings SGPS, S.A. did
the same since, by delay of the court, this company was only very recently notified to act as a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Bank of Portugal cannot be challenged and (iii) the material incompetence of the
court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an opponent
party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the opponent
party. After the presentation of the arguments, Bank of Portugal attached to the proceedings what it called an
evidence process (allegedly in compliance with the law) but most of the documents delivered were truncated in such a
way that neither the court nor the claimants are able to obtain adequate knowledge thereof. That issue was already
raised in the proceedings (requesting the court to order Bank of Portugal to deliver a true evidence process) but no
decision thereon has been made yet.
Currently, the proceedings are prepared for confirmation of the decision accepting the formalities of the right of action
(with the making of a decision on the specific objections invoked). In case the judge considers that Novo Banco is an
opponent party, the judge must start by issuing a pre-confirmation in order to request the claimants to identify it.
Afterwards, that Bank will be notified to present its opposition arguments.
The case was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal opinions to
the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
11. Following the restructuring process agreed with the Directorate-General for Competition (DGComp) and the
Portuguese State, Group Banco Comercial Portugu\u00eas implemented a process of salary adjustment for a temporary
period. Additionally, it was agreed between the Bank and the Unions that, in the years after the State intervention and
if there are distributable profits, the Board of Directors and the Executive Committee would submit for approval of the
Shareholders\u2019 General Meeting a proposal of distribution of profits to the employees, which allows the distribution of an
accumulated total global amount at least equal to the total amount that was not received over the temporary term of
the salary adjustment, as described in the clause no. 151-E of BCP\u2019s Collective Labour Agreement, effective between
2014 and 2017.
At the General Meeting of 4 May 2022, following the proposal submitted by the Board of Directors, the application of
profits relating to the financial year of 2021 was approved, which included an extraordinary distribution to each
employee up to Euros 5,692,000, and the concrete determination of the amount to be attributed to each employee
must be fixed by the Executive Committee to employees who, having not already been fully compensated with the
results distributed in 2019 and 2020, remain in office on the date of payment of the remuneration corresponding to
June 2022.
12. The Bank was subject to tax inspections for the years up to 2019. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the case of
indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of determining
the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/corrections made by the tax
administration were the object of contestation by administrative and/or judicial means.
The Bank recorded provisions or deferred tax liabilities at the amount considered sufficient to offset the tax or tax loss
carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by the tax administration.
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherProvisionsContingentLiabilitiesAndContingentAssetsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-684": { "value": "Provisions
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Provision for guarantees and other commitments
110,754
110,649
Other provisions for liabilities and charges
451,032
348,095
561,786
458,744
Changes in Other provisions for liabilities and charges are analysed as follows:
(Thousands of euros)
2022
2021
Balance on 1 January
348,095
207,691
Transfers resulting from changes in the Group's structure
\u2014
(30)
Transfers to Impairment of investments in associates
(Banco Millennium Atl\u00e2ntico, S.A.) (note 26)
\u2014
(22,300)
Other transfers
(5,504)
4,596
Charge of the year for restructuring costs (note 7)
4,414
84,152
Charge for the year (note 13)
569,226
651,156
Reversals for the year (note 13)
(1,854)
(16,566)
Amounts charged-off
(116,874)
(135,506)
Allocation to loan's portfolio (note 22)
(344,052)
(443,296)
Exchange rate differences
(2,419)
18,198
Balance at the end of the year
451,032
348,095
estimate of the amount and respective probability of payment.
This balance includes provisions for lawsuits, frauds and tax contingencies. As at 31 December 2022, the provisions
constituted to cover tax contingencies totalled Euros 38,311,000 (31 December 2021: Euros 37,524,000) and are
associated, essentially, to contingencies related to VAT and Stamp Duty.
Additionally, there are provisions for liabilities and charges recorded for corporate restructuring funds and carved-out
assets of the Project Crow, completed in December 2022.
In 2021, the Bank's Board of Directors approved in April the employee reduction plan. The decision was taken based on
a thorough analysis of needs and existing capacity, considering the specifics of the Bank, the changes in behaviour and
needs of customers, the impact of new technologies on business models and processes, as well as the developments
that are expected for the Bank.
The implementation of this plan started in mid-June 2021, having been contacted throughout the 3rd quarter of 2021
all employees covered by the program, which included early retirements and terminations. For diverse reasons, the
effective departure of some Employees was agreed for dates during the first half of 2022.
In view of the initiatives that had already been developed on 30 June 2021, the Bank considered that the requirements
defined in IAS 37 - Provisions, Contingent Liabilities and Contingent Assets for the recognition of restructuring costs in
its accounts for the first half of 2021 were met. Thus, in the first half of 2021, was recorded\u00a0 in personnel costs, a
provision for restructuring costs in the amount of Euros 81,373,000, which was reinforced in December in the amount of
Euros 2,779,000, which makes a total of Euros 84,152,000 in 2021 (note 7). As at 31 December 2021, the balance of the
provision for restructuring costs amounted to Euros 4,692,000, of which Euros 2,297,000 are referred to agreements
already concluded with some employees whose effective departures have been occur during the first half of 2022 and
Euros 2,395,000 are referred to future costs with the health protection of former Employees, who left the Bank as part
of the employees' reduction process developed in 2021.
As at December 2022, the balance of this provision amounts to Euros 4,893,000, which was reinforced in the amount of
Euros 4,414,000 (note 7), referring to agreements already concluded with some employees whose effective departures
will occur during the first half of 2023. In 2022, the Bank also has written-off the\u00a0 amount of Euros 4,213,000, of which
Euros 3,443,000 corresponds to costs with the employee's departures and Euros 770,000 refers to costs with health
protection of former Employees.
Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium (Poland)
In 2021, Bank Millennium changed the accounting policy regarding the recognition of provisions for future claims related
to active CHF mortgage loans in the balance sheet. As a result of changes in market conditions, such as the growing
number of unfavourable court judgments declaring the entire agreement or certain provisions of these credits to be
invalid, the Bank does not expect that all contractual cash flows related to these loans will be recovered. As a result,
Bank Millennium allocates provisions for future claims and recognizes them as a reduction of the gross carrying amount
of loans for which a decrease in future cash flows is expected, in accordance with paragraph B5.4.6 of IFRS 9 \"Financial
Instruments\" (previously provisions for future claims used to be recognized in accordance with IAS 37 \"Provisions,
Contingent Liabilities and Contingent Assets\"). As a result of the above change, the approach applied in accordance
with IAS 37 will be continued only regarding claims relating to already repaid (or almost fully repaid) receivables not
recognised in Bank Millennium's balance sheet.
As at 31 December 2022, the Loans and advances to customers portfolio in CHF has a gross amount of Euros
2.477.851,000 (31 December 2021: Euros 2,817,504,000).
As at 31 December 2022, the provisions estimated by Bank Millennium to address the legal risk related to foreign
currency-indexed mortgage loans amount to Euros 1,152,457,000 (PLN 5,395,344,000)), of which Euros 976,782,000
(PLN 4,572,901,000) are presented under assets, as a deduction from the gross amount of the loan portfolio in CHF
(note 22) and Euros 175,676,000 (PLN 822,443,000) are presented under Provisions.\u00a0
With reference to 31 December 2021, the provisions estimated by Bank Millennium to address the legal risk related to
foreign currency-indexed mortgage loans amounted to Euros 727,026,000 (PLN 3,332,614,000), of which Euros
636,309,000 (PLN 2,916,778,000) were presented under assets, as a deduction from the gross amount of the loan
portfolio in CHF (note 21) and Euros 90,716,000 (PLN 415,835,000) were presented under Provisions.
The variation in the level of provisions or concrete losses will depend on the final court decisions about each case and
on the number of court cases.
Provisions for legal risk related to foreign currency-indexed mortgage loans in
Bank Millennium (Poland)
1. Court claims and current provisions for legal risk
On 31 December 2022, Bank Millennium had 16,008 loan agreements and additionally 1,272 loan agreements from
former Euro Bank under individual ongoing litigations (excluding claims submitted by the bank against clients i.e. debt
collection cases) concerning the use of indexation clauses of FX mortgage loans submitted to the courts (78% loans
agreements before the court of first instance and 22% loans agreements before the court of second instance) with the
total value of claims filed against the Bank Millennium by the plaintiffs amounting to PLN 2,758.4 million (Euros 589.20
million) and CHF 201.9 million (Euros 204.53 million) [(Bank Millennium portfolio: PLN 2,536 million (Euros 541.70
million) and CHF 197.3 million (Euros 199.87 million) and former Euro Bank portfolio: PLN 222.5 million (Euros 47.53
million) and CHF 4.6 million (Euros 4.66 million)].
The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the
contract and payment for reimbursement of paid principal and interest instalments as undue performance, due to the
alleged abusive nature of indexation clauses, or maintenance of the loan agreement in PLN and with interest rate
indexed to CHF Libor.
In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to determine
Bank Millennium's liability towards the group members based on unjust enrichment (undue benefit) ground in
connection with the FX mortgage loans. A judgment in these proceedings will not directly grant a right to any
compensation amounts to the group members that have initiated this class action. The number of credit agreements
covered by these proceedings is 3,273. On 24 May 2022, the court issued a judgment on the merits, dismissing the claim
in full. Both parties requested a written justification of the judgment. On 13 December 2022, the claimant filed on
appeal against the judgment of 24 May 2022 and the Bank Millennium also filed its response to the that appeal.
The aggressive advertising campaign to encourage litigation against the financial sector affected the number of court
disputes. Until the end of 2019, 1,982 individual claims were filed against Bank Millennium (in addition, 236 against
former Euro Bank), in 2020 the number increased by 3,006 (265), in 2021 the number increased by 6,153 (422), while in
2022 the number increased by 5,750 (408).
Based on ZBP (the Polish Banking Association) data gathered from all banks having FX mortgage loans, vast majority of
disputes were finally resolved in favour of banks until 2019 year. However, after the Court of Justice of the European
Union (CJEU) judgment issued on 3 October 2019 (Case C-260/18) the proportion has adversely changed and vast
majority of court cases have been lost by banks. As far as Bank Millennium itself is concerned, from 2015 and until the
end of 2022, 1,173 cases were finally resolved (1,111 in claims submitted by clients against Bank Millennium and 62 in
claims submitted by Bank Millennium against clients i.e. debt collection cases). out of which 354 were settlements, 46
were remissions, 53 rulings were favorable for Bank Millennium and 720 were unfavorable, including both invalidation
of loan agreements as well as conversions into PLN+LIBOR. Bank Millennium files appeals against negative judgements
of the courts of first instance as well as submits cassation appeals to the Supreme Court against unfavourable for Bank
Millennium legally binding verdicts. Currently, the statistics of first and second instance court decisions are much more
unfavourable and its number is also increasing.
The outstanding gross balance of the loan agreements under individual court cases and class action against Bank
Millennium on 31 December 2022 was PLN 5,576 million (Euros 1,191.05 million) [of which the outstanding amount of
the loan agreements under the class action proceeding was PLN 897 million (Euros 191.6 million)].
If all Bank Millennium\u2019s originated loan agreements currently under individual and class action court proceedings would
be declared invalid without proper compensation for the use of capital, the pre-tax cost could reach PLN 5,499 million
(Euros 1,174.6 million). Overall losses may be higher or lower depending on the final court decision in this regard.
During 2022, Bank Millennium created a PLN 1,844 million provisions (Euros 393.88 million) and PLN 173 million (Euros
36.95 million) for former Euro Bank originated portfolio. The balance sheet value of provisions for the Bank Millennium
portfolio at the end of December 2022 was at the level of PLN 4,986 million (Euros 1,065.02 million), and PLN 409
million (Euros 87.36 million) for former Euro Bank originated portfolio.
The methodology developed by Bank Millennium for calculating provisions for legal risk involved with indexed loans is
based on the following main parameters:
(1) the number of current cases (including class actions) and potential future lawsuits that arise within a specified
(three-year) time horizon;
(2) the amount of Bank Millennium's potential loss in the event of a specific court judgment;
(3) the probability of obtaining a specific court judgment calculated on the basis of statistics of decisions of the
banking sector in Poland and legal opinions obtained;
(4) in the case of the scenario of cancellation of the loan agreement, the element taken into account, with a view to
legal assessments, is the calculation of Bank Millennium's loss, taking into account the assignment of a minimum
probability of obtaining remuneration for the use of capital made available;
(5) estimates involved with amicable settlements with clients, concluded in court or out of court:
a.negotiations are conducted on a case-by-case basis and can be stopped at any time by Bank Millennium
b.as the negotiations efforts have already been material in the past, the probability of success may be lower in
the future and at the same time, gradually most of the client base has had contact with Bank Millennium
regarding potential negotiation of the conversion of the loans to PLN, so Bank Millennium is taking a
conservative approach when calculating the potential future impact for the time being.
Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Societe Generale.
Bank Millennium analyzed the sensitivity of the methodology for calculating provisions, for which a change in the
parameters would affect the value of the estimated loss to the legal risk of litigation:
Parameter
Scenario
Impact on loss due to legal risk related to the
portfolio of mortgage loans in convertible
currencies
Change in the number of lawsuits
Additionally, 1 p.p. of active clients file a
lawsuit against Bank Millennium
PLN 35 million (Euros 7.48 million)
Change in the probability of winning
a case
The probability of Bank Millennium winning
a case is lower by 1 p.p
PLN 41 million (Euros 8.76 million)
Change in estimated losses for each
variant of the judgment
Increase in losses for each variant of the
judgment by 1 p.p
PLN 40 million (Euros 8.54 million)
Bank Millennium is open to negotiate case by case favourable conditions for early repayment or conversion of loans to
PLN. As a result of these negotiations and other natural drivers, the number of active FX mortgage loans decreased by
8,449 in 2021 and 7,943 in 2022. As of end 2022, Bank Millennium had 38,011 active FX mortgage loans. Cost incurred in
conjunctions with these negotiations totalled PLN 364.5 million (Euros 77.86 million) in 2021 and PLN 515.2 million
(Euros 110.05 million) in 2022 and is presented mainly in \u2018Foreign exchange gains/(losses)\u2019 in the income statement,
and in 2022 also in 'Results on modification'.
Finally, it should also be mentioned, that Bank Millennium, as at 31 December 2022, had to maintain additional own
funds for the coverage of additional capital requirements related to FX mortgage portfolio risks (Pillar II FX buffer) in
the amount of 1.95 p.p. (1.94 p.p. at the Group level), part of which is allocated to operational/legal risk.
CJEU and Supreme Court rulings relevant to risk assessment
On 3 October 2019, the Court of Justice of the European Union ('the CJEU') issued the judgment in Case C-260/18 in
connection with the preliminary questions formulated by the District Court of Warsaw in the case against Raiffeisen
Bank International AG. The judgment of the CJEU, as regards the interpretation of European Union law made therein, is
binding on domestic courts. The judgment in question interpreted Article 6 of Directive 93/13/EEC of 5 April 1993 on
unfair terms in consumer contracts establishing that the said provision must be interpreted (i) as not precluding a
national court, after finding that certain terms of a loan agreement indexed to a foreign currency and subject to an
interest rate directly linked to the interbank rate of the currency concerned are unfair, from taking the view, in
accordance with its domestic law, that that contract cannot continue in existence without those terms because the
effect of their removal would be to alter the nature of the main subject matter of the contract; (ii) first, the
consequences for the consumer of a contract being annulled in its entirety, must be assessed in the light of the existing
or foreseeable circumstances at the time when the dispute arose, and that, second, for the purposes of that
assessment, the wishes expressed by the consumer in that regard are the decisive factor; (iii)\u00a0 as precluding gaps in a
contract caused by the removal of the unfair terms contained in that contract from being filled solely on the basis of
national provisions of a general nature which provide that the effects expressed in a legal transaction are to be
supplemented, inter alia, by the effects arising from the principle of equity or from established customs, which are
neither supplementary provisions nor provisions applicable where the parties to the contract so agree; (iv)\u00a0 as
precluding unfair terms contained in a contract from being upheld where their removal would entail that contract being
annulled and the court takes the view that that annulment would give rise to unfavorable effects for the consumer, if
the latter has not consented to them being upheld.
The CJEU judgment concerns only the situation where the national court has previously found the contract term to be
abusive. It is the exclusive competence of the national courts to assess, in the course of judicial proceedings, whether a
particular contract term can be regarded as abusive in the circumstances of the case.
On 29 April 2021, the CJEU issued the judgement in the case C-19/20 in connection with the preliminary questions
formulated by the District Court in Gda\u0144sk in the case against of ex-BPH S.A., CJEU said that the Council Directive
93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as meaning that (i) it is for the
national court to find that a term in a contract concluded between a seller or supplier and a consumer is unfair, even if
it has been contractually amended by those parties. Such a finding leads to the restoration of the situation that the
consumer would have been in in the absence of the term found to be unfair, except where the consumer, by means of
amendment of the unfair term, has waived such restoration by free and informed consent, which it is for the national
court to ascertain. However, it does not follow from that provision that a finding that the original term is unfair would,
in principle, lead to annulment of the contract, since the amendment of that term made it possible to restore the
balance between the obligations and rights of those parties arising under the contract and to remove the defect which
vitiated it; (ii) they do not preclude the national court from removing only the unfair element of a term in a contract
concluded between a seller or supplier and a consumer where the deterrent objective pursued by that directive is
ensured by national legislative provisions governing the use of that term, provided that that element consists of a
separate contractual obligation, capable of being subject to an individual examination of its unfair nature, and those
provisions preclude the referring court from removing only the unfair element of a term in a contract concluded
between a seller or supplier and a consumer where such removal would amount to revising the content of that term by
altering its substance, which it is for that court to determine; (iii) the consequences of a judicial finding that a term if
a contract concluded between a seller or supplier and a consumer is unfair are covered by national law and the
question of continuity of the contract should be assessed by the national court of its own motion in accordance with an
objective approach on the basis of those provisions;(iv) it is for the national court, finding that a term in a contract
concluded between a seller or supplier and a consumer, to inform the consumer, in the context of the national
procedural rules after both parties have been heard, of the legal consequences entailed by annulment of the contract,
irrespective of whether the consumer is represented by a professional representative.
On 18 November 2021, the Court of Justice of the European Union (CJEU) issued a judgment in case C-212/20 in
connection with questions submitted by the District Court for Warsaw Wola, in Warsaw, in the case against Raiffeisen
Bank International AG. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer
contracts must be interpreted (i) as meaning that the content of a clause of a loan agreement concluded between a
seller or supplier and a consumer that sets the buying and selling prices of a foreign currency to which the loan is
indexed must enable a consumer who is reasonably well informed and reasonably observant and circumspect to
understand, on the basis of clear and intelligible criteria, the way in which the foreign currency exchange rate used to
calculate the amount of the repayment instalments is set, in order that that consumer is able to determine himself or
herself, at any time, the exchange rate applied by the seller or supplier; (ii) as precluding the national court, which has
found that a term of a contract concluded between a seller or supplier and a consumer is unfair, within the meaning of
Article 3(1) of that directive, from interpreting that term in order to remedy its unfairness, even if that interpretation
would correspond to the common intention of the parties to that contract.
On 10 June 2021, the Court of Justice of the European Union (CJEU) issued an order in case C-198/20 in connection
with questions submitted by the District Court for Warsaw Wola in Warsaw in the case against Santander Bank Polska
SA. The CJEU stated that the protection provided for in Council Directive 93/13/EEC is granted to all consumers, not
just those who can be considered to be 'duly informed and reasonably observant and circumspect average consumers'.
On 8 September 2022, the Court of Justice of the European Union (CJEU) issued a judgment in joined cases C-80/21,
C-81/21, C-82/21 in connection with questions submitted by the District Court for Warsaw \u015ar\u00f3dmie\u015bcie in Warsaw in
cases against Deutsche Bank SA and mBank SA. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on
unfair terms in consumer contracts must be interpreted (i) as precluding national case-law according to which the
national court may declare unfair not the entire term of a contract concluded between a consumer and a seller or
supplier, but only those parts of it which are unfair, so that the term remains partially effective after the removal of
those parts, where such removal would be tantamount to revising the content of the term by affecting its substance,
which is a matter for the national court to determine; (ii) as precluding national case-law according to which the
national court may, after finding that an unfair term contained in a contract concluded between a consumer and a
seller or supplier is void and does not result in the annulment of that contract as a whole, replace that term with a
supplementary provision of national law; (iii) as precluding national case-law according to which the national court
may, after finding that an unfair term contained in a contract concluded between a consumer and a seller or supplier is
void and that the contract as a whole is void, replace the annulled term either by interpreting the parties\u2019 wishes in
order to avoid the annulment of the contract, or by applying to the annulled unfair term a supplementary provision of
national law, even though the consumer has been informed of the consequences of the annulment of that contract and
has accepted them; (iv) as precluding national case-law according to which the 10\u2011year limitation period for a
consumer\u2019s action for the restitution of sums unduly paid to a seller or supplier in performance of an unfair term
contained in a credit agreement with a duration of 30 years begins to run on the date of each performance by the
consumer, even though the consumer was not in a position, at that date, to assess the unfairness of the contractual
term himself or herself or was not aware of the unfairness of the term, and regardless of the fact that the contract had
a repayment period, in this case 30 years, which is much longer than the statutory limitation period of 10 years.
On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the
meaning of legal principle has been granted, stating that:
1. An abusive contractual clause (art. 3851 \u00a7 1 of the Polish Civil Code), by force of the law itself, is ineffective to the
benefit of the consumer who may consequently give conscious and free consent to this clause and thus restore its
effectiveness retroactively.
2. If, without the ineffective clause, the loan agreement cannot be binding, the consumer and the lender shall be
entitle for separate claims for return of cash benefits made to the other part during the term of this agreement (art.
410 \u00a7 1 in relation to art. 405 of the Polish Civil Code). The lender may demand return of the performance from the
moment the loan agreement becomes definitively ineffective.
On 28 April 2022, the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with
consumers, the provision of Article 358\u00ba1 of the Polish Civil Code is a special provision to Article 353\u00ba1 of the Civil Code,
which means that if the prerequisites for the application of both provisions exist, the court should apply the special
provision and declare the contractual provision definitively ineffective, rather than invalid. This decision of the
Supreme Court should be perceived as significantly limiting the risk of Bank Millennium's claims for return of capital
being time-barred.
In this context, taking into consideration the recent negative evolution in the court verdicts regarding FX mortgage
loans, and if such trend continues, Bank Millennium will have to regularly review and may need to continue to increase
the balance of provisions allocated to court litigations.
It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further examined
by the national courts within the framework of disputes considered which would possibly result in the emergence of
further interpretations, which are relevant for the assessment of the risks associated with subject matter proceedings.
This circumstance indicates the need for constant analysis of these matters. Further request for clarification and ruling
addressed to the European Court of Justice and Polish Supreme Court have already been filed and may still be filed
with potential impact on the outcome of the court cases.
2. Events that may impact foreign currency-indexed mortgage loans legal risk and related
provision
On 29 January 2021 a set of questions addressed by the First President of the Polish Supreme Court to the full Civil
Chamber of the Supreme Court was published. This may have important consequences in terms of clarifications of
relevant aspects of the court rulings and their consequences. The Civil Chamber of the Supreme Court has been
requested for answering the questions concerning key matters related to FX mortgage agreements: (i) is it possible to
replace - with a legal provisions or according\u00a0 commons practices - the abusive provisions of an agreement which refer
to FX exchange rate determination; moreover, (ii) in case of impossibility of determining the exchange rate of a foreign
currency in the indexed/denominated credit agreement - is it possible to keep the agreement still in force in its
remaining scope; as well as (iii) if in case of invalidity of the CHF credit there would be applicable the theory of
balance (i.e. does arise a single claim which is equal to the difference between value of claims of bank and the
customer) or the theory of two conditions (separate claims for the bank and for the client that should be dealt with
separately). The Polish Supreme Court has also been requested for answering the question on (iv) from which point in
time there shall be starting the limitation period in case of bank's claim for repayment of amounts made available as a
loan and (v) whether banks and consumers may receive remuneration for using their pecuniary means by another party.
On 11 May 2021, the Civil Chamber of the Polish Supreme Court requested opinions on Swiss franc mortgage loans from
five institutions including the National Bank of Poland (NBP), the Polish Financial Supervision Authority (UKNF), the
Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman.
The positions of: the Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman
are in general favourable to consumers, while the National Bank of Poland and the Polish Financial Supervision
Authority present a more balanced position, including fair principles of treatment of FX mortgage borrowers vis-\u00e0-vis
PLN mortgage borrowers, as well as balanced economic aspects regarding solutions for the problem that could be
considered by the Polish Supreme Court.
In the next meeting of the Supreme Court that took place on 2 September 2021, the Court did not address the answers
to the submitted questions and no new meeting date is known.
On 12 August 2021, in the case for payment brought by a consumer against Bank Millennium, the CJEU was asked for a
preliminary ruling (C-520/21) whether, in the event that a loan agreement concluded by a bank and a consumer is
deemed invalid from the beginning due to unfair contract terms, the parties, in addition to the reimbursement of the
money paid in contracts (bank - loan capital, consumer - instalments, fees, commissions and insurance premiums) and
statutory interest for delay from the moment of demanding for payment, may also claim any other benefits, including
receivables in particular, remuneration, compensation, reimbursement of costs or valorization of the performance. The
hearing was held on 12 October 2022. The hearing was attended by representatives of Bank Millennium, the consumer's
representative, representatives of the European Commission, the Polish government, the Financial Ombudsman, the
Commissioner for Human Rights, the Polish Financial Supervision Authority and the prosecutor. In its position, the
European Commission opposed granting banks the right to an additional financial benefit for the consumer's use of the
capital provided. At the same time, the Commission concluded that granting consumers the right to an additional
financial benefit will not be contrary to the EU law. The representatives of the Polish government, the Financial
Ombudsman, the Commissioner for Human Rights and the prosecutor also objected to granting banks the right to an
additional benefit. The Chairman of the Polish Financial Supervision Authority pointed out that the essence of the
problem is not the abusiveness of contractual clauses, but the appreciation of the Swiss Franc (CHF) against the zloty
(PLN). In the opinion of the Chairman of the Polish Financial Supervision Authority, banks are entitled to economic
compensation for allowing another entity to use the capital.
Regarding the case C-520/21 which is awaiting decision by the CJEU, whose object essentially concerns possible
compensation for financing when a mortgage loan agreement indexed to foreign currency concluded between a
consumer and a bank is declared void from the beginning due to unfair contract terms, the Advocate General issued an
opinion on 16 February 2023 in the sense that the Article 6 no. 1 and Article 7 no. 1 of Council Directive 93/13/EC of 5
of April 1993, concerning unfair terms in contracts concluded with consumers, must be interpreted as:
- do not preclude a jurisprudential interpretation of national law under which the consumer, in addition to
reimbursement the amounts paid under that contract and paying default interest at the statutory rate from the date of
the reimbursement request, may present additional claims to the bank as a result of that declaration of invalidity. It is
thus a matter for the national court to determine, by reference to its domestic law, whether consumers have the right
to assert claims of that nature and, if so, to rule on their merits.
- preclude a jurisprudential interpretation of national law under which, the Bank in addition to the reimbursement of
the amounts paid under that contract and paying default interest at the statutory rate from the date of the
reimbursement request, may present additional claims against the consumer as a result of that declaration of
invalidity.
If the final decision of the CJEU judge comes in the same direction as that of the Advocate General, this may lead to an
increase in provisions for legal risk related to mortgage loans in CHF, especially if this results in a revision of the
expected influx of new cases in court.
On 9 December 2022, in the case brought by Bank Millennium against the borrower for payment \u2013 return of the capital
made available to the borrower on the basis of an invalid capital contract and the equivalent value of the benefit
related to the borrower's use of capital, the court referred a question to the CJEU for a preliminary ruling whether, if it
is found that the loan contract concluded by the bank and the consumer is invalid from the beginning due to the
conclusion of unfair contractual terms, in addition to the return of money paid in the performance of this contract
(loan principal) and statutory late payment interest from the moment of the request for payment, the bank may also
demand any other benefits, including receivables, in particular remuneration, compensation, reimbursement of costs or
valorisation of the benefit. The case was registered under the reference number C-756/22. Referring the question, the
court asked the CJEU to join the case with the above-mentioned ongoing proceedings under reference number
C-520/21. The CJEU decided not to join the cases and simultaneously suspended case C-756/22 up to judgment in case
C- 520/21.
With the scope of settlements between Bank Millennium and borrower following the fall of the loan agreement is also
connected the legal issue directed to the seven-person composition of the Polish Supreme Court (case sign: III CZP
54/21). The date of case review has not been specified yet.
The Supreme Court was also presented with the issue of whether the loan agreement is a mutual agreement in the light
of the regulations concerning retention right.
On 8 December 2020, Mr. Jacek Jastrz\u0119bski, the Chairman of the Polish Financial Supervision Authority (\u2018PFSA\u2019)
proposed a \u2018sector\u2019 solution to address the sector risks related to FX mortgages. The solution would consist in offering
by banks to their clients a voluntary possibility of concluding arrangements based on which a client would conclude
with the bank a settlement as if his/her loan from the very beginning had been a PLN loan bearing interest at an
appropriate WIBOR rate increased by the margin historically employed for such loan.
Following that public announcement, the idea was subject of consultations between banks under the auspices of the
PFSA and Polish Banking Association. Banks in general have assessed the conditions under which such solution could be
implemented and consequent impacts.
As expressed in previous financial reports, when that assessment was done, in the view of the Management Board of
Bank Millennium, important aspects to take into consideration when deciding on potential implementation of such
program were: a) favourable opinion or at least non-objection from important public institutions; b) support from
National Bank of Poland to the implementation; c) level of legal certainty of the settlement agreements to be signed
with the borrowers; d) level of the financial impact on a pre- and after tax basis; e) capital consequences including
regulatory adjustments in the level of capital requirements associated with FX mortgage loans.
Based on current information some of the above-mentioned aspects are not likely to be fully clarified and/or achieved.
Any decision regarding implementation of such program would require the Management Board to submit it to the
Supervisory Board and General Shareholders meeting of Bank Millennium taking into consideration the relevance of such
decision and its implications.
Despite the fact that not all of those aspects have been possible to clarify, Bank Millennium, in practice, has been using
elements of such solution on several individual negotiations with FX mortgage borrowers, including in the course of
court proceedings.
The effect of the Polish Supreme Court's resolution of 7 May 2021 is that Bank Millennium is entitled to a refund of the
cash benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the
uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to protect
its interests, files lawsuits for payment against borrowers in a court dispute with the bank. Bank Millennium's demand
consists of a claim for return of the capital made available to the borrower under the contract and a claim for
reimbursement of the equivalent of the benefit obtained by the borrower in connection with the use of the capital
made available (equivalent to the financial service). By 31 December 2022, Bank Millennium filed over 3,000 lawsuits
against the borrowers. Due to the ongoing proceedings on questions referred for a preliminary ruling (C-520/21,
C-756/22) concerning the scope of claims of the parties to an invalid contract, no final decision has yet been issued in
Bank Millennium's cases containing a substantive assessment of the Bank's claims for reimbursement of benefits related
to the use of capital.
Due to the complexity and uncertainty regarding the outcome of court cases, including counter-claims, as well as from
potential implementation of KNF Chairman solution or other negotiation solutions or from potential Supreme Court
decisions or European Court of Justice decisions, it is difficult to reliably estimate final impacts from different potential
outcomes as at the date of publication of the financial statements.
", "dimensions": { "concept": "ifrs-full:DisclosureOfProvisionsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-685": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Interests and other amounts payable
163,843
148,522
Operations to be settled - foreign, transfers and deposits
212,208
134,996
Credit insurance received and to accrued
62,740
72,075
Holidays, subsidies and other remuneration payable
55,132
51,841
Transactions on securities to be settled
4,514
39,979
Public sector
43,628
35,460
Creditors
Rents to pay
185,163
211,345
Deposit account and other applications
89,386
58,390
Suppliers
35,649
39,350
From factoring operations
41,618
32,113
For futures and options transactions
73,394
14,356
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
10,819
6,389
Associated companies
21
106
\u00a0 Other creditors
\u00a0 \u00a0 Residents
66,158
27,107
\u00a0 \u00a0 Non-residents
70,590
60,394
Deferred income
10,155
9,543
Other administrative costs payable
4,763
4,133
Other liabilities
262,192
170,884
1,391,973
1,116,983
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the amount of
Euros 6,777,000 (31 December 2021: Euros 4,143,000) related to the actual value of benefits attributed associated with
mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity includes amounts payable within 3 business days of stock exchange
operations.
The Group has several operating leases for properties, being registered in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by maturity,
is as follows:
(Thousands of euros)
2022
2021
Until 1 year
20,402
22,250
1 to 5 years
137,949
82,181
Over 5 years
33,485
114,296
191,836
218,727
Accrued costs recognised in Net interest income
(6,673)
(7,382)
185,163
211,345
", "dimensions": { "concept": "ifrs-full:DisclosureOfAccruedExpensesAndOtherLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-686": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Interests and other amounts payable
163,843
148,522
Operations to be settled - foreign, transfers and deposits
212,208
134,996
Credit insurance received and to accrued
62,740
72,075
Holidays, subsidies and other remuneration payable
55,132
51,841
Transactions on securities to be settled
4,514
39,979
Public sector
43,628
35,460
Creditors
Rents to pay
185,163
211,345
Deposit account and other applications
89,386
58,390
Suppliers
35,649
39,350
From factoring operations
41,618
32,113
For futures and options transactions
73,394
14,356
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
10,819
6,389
Associated companies
21
106
\u00a0 Other creditors
\u00a0 \u00a0 Residents
66,158
27,107
\u00a0 \u00a0 Non-residents
70,590
60,394
Deferred income
10,155
9,543
Other administrative costs payable
4,763
4,133
Other liabilities
262,192
170,884
1,391,973
1,116,983
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the amount of
Euros 6,777,000 (31 December 2021: Euros 4,143,000) related to the actual value of benefits attributed associated with
mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity includes amounts payable within 3 business days of stock exchange
operations.
The Group has several operating leases for properties, being registered in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by maturity,
is as follows:
(Thousands of euros)
2022
2021
Until 1 year
20,402
22,250
1 to 5 years
137,949
82,181
Over 5 years
33,485
114,296
191,836
218,727
Accrued costs recognised in Net interest income
(6,673)
(7,382)
185,163
211,345
", "dimensions": { "concept": "ifrs-full:DisclosureOfOtherLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-687": { "value": "Other liabilities
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Interests and other amounts payable
163,843
148,522
Operations to be settled - foreign, transfers and deposits
212,208
134,996
Credit insurance received and to accrued
62,740
72,075
Holidays, subsidies and other remuneration payable
55,132
51,841
Transactions on securities to be settled
4,514
39,979
Public sector
43,628
35,460
Creditors
Rents to pay
185,163
211,345
Deposit account and other applications
89,386
58,390
Suppliers
35,649
39,350
From factoring operations
41,618
32,113
For futures and options transactions
73,394
14,356
Liabilities not covered by the Group Pension Fund - amounts payable by the Group
10,819
6,389
Associated companies
21
106
\u00a0 Other creditors
\u00a0 \u00a0 Residents
66,158
27,107
\u00a0 \u00a0 Non-residents
70,590
60,394
Deferred income
10,155
9,543
Other administrative costs payable
4,763
4,133
Other liabilities
262,192
170,884
1,391,973
1,116,983
The balance Liabilities not covered by the Group Pension Fund - amounts payable by the Group includes the amount of
Euros 6,777,000 (31 December 2021: Euros 4,143,000) related to the actual value of benefits attributed associated with
mortgage loans to employees, retirees and former employees.
The balance Amounts payable on trading activity includes amounts payable within 3 business days of stock exchange
operations.
The Group has several operating leases for properties, being registered in the item Rents to pay the amount of lease
liabilities recognised under IFRS 16, as described in the accounting policy 1 H. The analysis of this balance, by maturity,
is as follows:
(Thousands of euros)
2022
2021
Until 1 year
20,402
22,250
1 to 5 years
137,949
82,181
Over 5 years
33,485
114,296
191,836
218,727
Accrued costs recognised in Net interest income
(6,673)
(7,382)
185,163
211,345
", "dimensions": { "concept": "ifrs-full:DisclosureOfTradeAndOtherPayablesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-688": { "value": "Share capital, Share premium and Other equity instruments
As at 31 December 2022, the Bank's share capital amounts to Euros 3,000,000,000 (31 December 2021: Euros
4,725,000,000) and is represented by 15,113,989,952 nominative book-entry shares without nominal value, fully
subscribed and paid up. As described in note 48, pursuant to the resolutions adopted at the General Meeting held on 20
December 2022, the Bank registered its new share capital of 3,000,000,000 Euros, maintaining the number of
nominatives, book-entry shares without nominal value and of the voting rights.
As at 31 December 2022, the Share premium amounts to Euros 16,470,667.11, corresponding to the difference between
the issue price (Euros 0.0834 per share) and the issue value (Euros 0.08 per share) determined under the scope of the
Exchange Offer occurred in June 2015.
As at 31 December 2022, the Other equity instruments in the amount of Euros 400,000,000 corresponds to 2,000
subordinated perpetual bonds (Additional Tier 1), issued on 31 January 2019, with a nominal value of Euros 200,000
each. This issue was classified as an equity instrument in accordance with the specific rules of IAS 32 and accounting
policy 1E. This operation without fixed term has the option of early repayment by the Bank as from the end of the 5th
year, and an annual interest rate of 9.25% during the first 5 years. As an instrument classified as AT1, the corresponding
interest payment is decided by the Bank at its discretion and is still subject to compliance with a set of conditions,
including compliance with the combined requirement of capital reserve and the existence of Distributable Funds in
sufficient amount. The payment of interest may also be cancelled by imposition of the competent authorities.
As at 31 December 2022, the shareholders who hold, individually or jointly, 5% or more of the Bank's capital, are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
Total Qualified Shareholdings
7,472,294,105
49.44%
49.44%
Under the scope of the Portuguese Securities Code update, which came into force at the beginning of 2022, the
reference threshold for qualifying holdings was changed from 2% to 5%.
As at 31 December 2021, the shareholders who hold, individually or jointly, 2% or more of the Bank's capital , are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd\u00a0
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
BlackRock, Inc. (*)
404,590,600
2.68%
2.68%
EDP Pension Fund (**)
311,616,144
2.06%
2.06%
Total Qualified Shareholdings
8,188,500,849
54.18%
54.18%
(*) In accordance with the announcement on 30 April 2021 (last information available).
(**) Allocation in accordance with Art. 20 (1.f) of the Portuguese Securities Code.
", "dimensions": { "concept": "ifrs-full:DisclosureOfIssuedCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-689": { "value": "Share capital, Share premium and Other equity instruments
As at 31 December 2022, the Bank's share capital amounts to Euros 3,000,000,000 (31 December 2021: Euros
4,725,000,000) and is represented by 15,113,989,952 nominative book-entry shares without nominal value, fully
subscribed and paid up. As described in note 48, pursuant to the resolutions adopted at the General Meeting held on 20
December 2022, the Bank registered its new share capital of 3,000,000,000 Euros, maintaining the number of
nominatives, book-entry shares without nominal value and of the voting rights.
As at 31 December 2022, the Share premium amounts to Euros 16,470,667.11, corresponding to the difference between
the issue price (Euros 0.0834 per share) and the issue value (Euros 0.08 per share) determined under the scope of the
Exchange Offer occurred in June 2015.
As at 31 December 2022, the Other equity instruments in the amount of Euros 400,000,000 corresponds to 2,000
subordinated perpetual bonds (Additional Tier 1), issued on 31 January 2019, with a nominal value of Euros 200,000
each. This issue was classified as an equity instrument in accordance with the specific rules of IAS 32 and accounting
policy 1E. This operation without fixed term has the option of early repayment by the Bank as from the end of the 5th
year, and an annual interest rate of 9.25% during the first 5 years. As an instrument classified as AT1, the corresponding
interest payment is decided by the Bank at its discretion and is still subject to compliance with a set of conditions,
including compliance with the combined requirement of capital reserve and the existence of Distributable Funds in
sufficient amount. The payment of interest may also be cancelled by imposition of the competent authorities.
As at 31 December 2022, the shareholders who hold, individually or jointly, 5% or more of the Bank's capital, are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
Total Qualified Shareholdings
7,472,294,105
49.44%
49.44%
Under the scope of the Portuguese Securities Code update, which came into force at the beginning of 2022, the
reference threshold for qualifying holdings was changed from 2% to 5%.
As at 31 December 2021, the shareholders who hold, individually or jointly, 2% or more of the Bank's capital , are the
following:
Shareholder
number
of shares
% share
capital
% voting
rights
Fosun Group - Chiado (Luxembourg) S.a.r.l. held by Fosun International Holdings Ltd\u00a0
4,525,940,191
29.95%
29.95%
Sonangol - Sociedade Nacional de Combust\u00edveis de Angola, EP, directly
2,946,353,914
19.49%
19.49%
BlackRock, Inc. (*)
404,590,600
2.68%
2.68%
EDP Pension Fund (**)
311,616,144
2.06%
2.06%
Total Qualified Shareholdings
8,188,500,849
54.18%
54.18%
(*) In accordance with the announcement on 30 April 2021 (last information available).
(**) Allocation in accordance with Art. 20 (1.f) of the Portuguese Securities Code.
", "dimensions": { "concept": "ifrs-full:DisclosureOfShareCapitalReservesAndOtherEquityInterestExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-690": { "value": "Legal and statutory reserves
Under the Portuguese legislation, the Bank is required to annually set-up a legal reserve equal to a minimum of 10% of
annual profits until the reserve equals the share capital, or until the sum of the free reserves constituted and the
retained earnings, if higher. In accordance with the proposal for the appropriation of net income for the 2021 financial
year approved at the General Shareholders' Meeting held on 4 May 2022, the Bank increased its legal reserves in the
amount of Euros 9,006,000, thus, as at 31 December 2022 the Legal Reserves amount to Euros 268,534,000 (31
December 2021: Euros 259,528,000).
In accordance with the current Portuguese legislation, the Group companies must set-up annually a reserve with a
minimum percentage between 5 and 20% of their net annual profits depending on the nature of their economic activity
and are recognised in Other reserves and retained earnings in the Bank's consolidated financial statements (note 43).
Reserves and retained earnings
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Fair value changes - Gross amount
Financial assets at fair value through other comprehensive income (note 23)
\u00a0 \u00a0 Debt instruments (*)
(228,425)
8,696
\u00a0 \u00a0 Equity instruments
(25,846)
(30,242)
Of associated companies and other changes
(67,758)
39,968
Cash-flow hedge
(1,744,727)
(100,394)
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
182
245
(2,066,574)
(81,727)
Fair value changes - Tax
Financial assets at fair value through other comprehensive income
\u00a0 Debt instruments
58,780
(12,426)
\u00a0 Equity instruments
1,550
6,055
Cash-flow hedge
540,755
26,330
From financial liabilities designated at fair value through profit or loss
related to changes in own credit risk
(57)
(77)
601,028
19,882
(1,465,546)
(61,845)
Exchange differences arising on consolidation
\u00a0 Bank Millennium, S.A.
(92,629)
(76,542)
\u00a0 BIM - Banco Internacional de Mo\u00e7ambique, S.A.
(139,373)
(162,561)
\u00a0 Banco Millennium Atl\u00e2ntico, S.A.
(143,989)
(155,310)
\u00a0 Others
2,073
2,311
(373,918)
(392,102)
Application of IAS 29
\u00a0 Effect on equity of Banco Millennium Atl\u00e2ntico, S.A.
42,316
36,571
\u00a0 Others
(3,965)
(3,965)
38,351
32,606
Other reserves and retained earnings
3,047,062
1,001,645
1,245,949
580,304
(*) Includes the effects arising from the application of hedge accounting.
The fair value changes correspond to the accumulated changes of the Financial assets at fair value through other
comprehensive income and Cash flow hedge, in accordance with the accounting policy presented in note 1 C.
The variation in the fair value of cash flow hedges reflects the economic impact on these hedges of the pronounced
increase in market interest rates, an effect that is more than offset by the economic impact on the fair value of
liabilities that are more sensitive to such an increase and that are accounted for at amortized cost.
During 2022, the changes occurred in Fair value changes - Gross amount, excluding the effect of hedge accounting and
changes in own credit risk associated with financial liabilities at fair value through profit or loss, are analysed as
follows:
(Thousands of euros)
2022
Balance as
at 1 January
Fair value
changes
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as at
31 December
Financial assets at fair value through
other comprehensive income (nota 23)
Debt instruments
Debt securities - Portuguese public
issuers
41,380
(293,433)
146,264
(2,406)
18,210
(89,985)
Others
(32,684)
(183,482)
85,052
(2,617)
(4,709)
(138,440)
8,696
(476,915)
231,316
(5,023)
13,501
(228,425)
Equity instruments
(30,242)
(3,183)
\u2014
\u2014
7,579
(25,846)
Associated companies and other
changes
Millenniumbcp Ageas
30,328
(109,649)
\u2014
\u2014
\u2014
(79,321)
Others
9,640
1,923
\u2014
\u2014
\u2014
11,563
39,968
(107,726)
\u2014
\u2014
\u2014
(67,758)
18,422
(587,824)
231,316
(5,023)
21,080
(322,029)
The changes occurred during 2021 in Fair value changes - Gross amount, excluding the effect of hedge accounting and
changes in own credit risk associated with financial liabilities at fair value through profit or loss, are analysed as
follows:
(Thousands of euros)
2021
Balance as
at 1 January
Fair value
changes
Fair value
hedge
adjustment
Impairment
in profit or
loss
Disposals
Balance as at
31 December
Financial assets at fair value through
other comprehensive income (nota
23)
Debt instruments
Debt securities - Portuguese public
issuers
90,611
(49,191)
37,417
920
(38,377)
41,380
Others
114,981
(176,982)
54,546
3,706
(28,935)
(32,684)
205,592
(226,173)
91,963
4,626
(67,312)
8,696
Equity instruments
(38,366)
1,231
\u2014
\u2014
6,893
(30,242)
Associated companies and other
changes
Millenniumbcp Ageas
36,560
(6,232)
\u2014
\u2014
\u2014
30,328
Others
6,125
3,515
\u2014
\u2014
\u2014
9,640
42,685
(2,717)
\u2014
\u2014
\u2014
39,968
209,911
(227,659)
91,963
4,626
(60,419)
18,422
The item Disposals refers to the derecognition of debt securities and equity instruments at fair value through other
comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfReservesAndOtherEquityInterestExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-691": { "value": "Non-controlling interests
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Fair value changes
Debt instruments
(98,139)
(77,625)
Equity instruments
2,380
2,993
Cash-flow hedge
(43,281)
(41,248)
Other
7
4
(139,033)
(115,876)
Deferred taxes
Debt instruments
18,531
14,704
Equity instruments
(467)
(568)
Cash-flow hedge
8,223
7,837
26,287
21,973
(112,746)
(93,903)
Exchange differences arising on consolidation
(187,306)
(181,738)
Actuarial losses (net of taxes)
1,742
435
Other reserves and retained earnings
1,080,424
1,217,878
782,114
942,672
The balance Non-controlling interests is analysed as follows:
(Thousands of euros)
Balance Sheet
Income Statement
2022
2021
2022
2021
Continuing operations
Bank Millennium Group
585,618
729,040
(108,125)
(145,672)
BIM - Banco Internacional de Mo\u00e7ambique Group
174,041
186,578
35,323
31,837
Other subsidiaries
22,455
27,054
(5,020)
202
782,114
942,672
(77,822)
(113,633)
Discontinued or discontinuing operations
BIM - Banco Internacional de Mo\u00e7ambique Group (*)
\u2014
\u2014
\u2014
543
782,114
942,672
(77,822)
(113,090)
", "dimensions": { "concept": "ifrs-full:DisclosureOfNoncontrollingInterestsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-692": { "value": "Guarantees and other commitments
This balance is analysed as follows:
(Thousands of euros)
2022
2021
Guarantees granted
Guarantees
4,144,220
3,957,973
Stand-by letter of credit
57,084
58,536
Open documentary credits
258,591
268,399
Bails and indemnities
135,718
136,145
4,595,613
4,421,053
Commitments to third parties
Irrevocable commitments
Term deposits contracts
1,621
8,760
Irrevocable credit lines
4,880,858
4,741,586
Securities subscription
41,285
70,017
Other irrevocable commitments
153,982
146,065
Revocable commitments
Revocable credit lines
5,834,056
5,437,681
Bank overdraft facilities
998,886
1,063,309
Other revocable commitments
128,025
133,354
12,038,713
11,600,772
Guarantees received
29,552,693
29,361,511
Commitments from third parties
13,453,876
13,567,068
Securities and other items held for safekeeping
75,348,414
80,154,791
Securities and other items held under custody by the Securities Depository Authority
82,314,713
92,350,151
Other off balance sheet accounts
131,084,605
129,608,603
", "dimensions": { "concept": "ifrs-full:DisclosureOfCommitmentsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-693": { "value": "0.0009", "decimals": 4, "dimensions": { "concept": "ifrs-full:DividendsRecognisedAsDistributionsToOwnersPerShare", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00", "unit": "iso4217:EUR/xbrli:shares" } }, "f-694": { "value": "Fair value
Fair value is based on market prices, whenever these are available. If market prices are not available, as occurs
regarding many products sold to clients, fair value is estimated through internal models based on cash-flow discounting
techniques. Cash-flows for the different instruments sold are calculated according to its financial characteristics and
the discount rates used include both the market interest rate curve and the current conditions of the Group's pricing
policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree of
judgment and reflects exclusively the value attributed to different financial instruments. However, it does not consider
prospective factors, as the future business evolution. Therefore, the values presented cannot be understood as an
estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial liabilities are
presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions repayable on
demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable estimate of
its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and Assets with
repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined dates.
This update is made based on the prevailing market rate for the term of each cash flow plus the average spread of the
production of the most recent 3 months of the same. For the elements with signs of impairment, the net impairment of
these operations is considered as a reasonable estimate of their fair value, considering the economic valuation that is
realized in the determination of this impairment.
For resources from Central Banks, it was considered that the book value is a reasonable estimate of its fair value, given
the nature of operations and the associated short-term. The rate of return of funding with the European Central Bank
was -0.6788%\u00a0 as at 31 December 2022 and -1% as at 31 December 2021.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied by
the Group on identical instruments for each of the different residual maturities (rates from the monetary market or
from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to conditions
used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of its fair value.
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash flows
for these instruments, considering that the payments of the instalments occur in the contractually defined dates. For
loans with signs of impairment, the net impairment of these operations is considered as a reasonable estimate of their
fair value, considering the economic valuation that is realized in the determination of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes of
this type of instruments and with similar residual maturity. The discount rate includes the market rates for the residual
maturity date (rates from the monetary market or from the interest rate swap market) and the spread used at the date
of the report, which was calculated from the average production of the three most recent months compared to the
reporting date.
Resources from customers and other loans
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar maturity.
The discount rate includes the market rates of the residual maturity date (rates of monetary market or the interest
rate swap market, at the end of the period) and the actual spread of the Group. This was calculated from the average
production of the three most recent months compared to the reporting date.
The average discount rates for Loans and advances to credit institutions, Loans and advances to customers, Resources
from credit institutions and Resources from customers are analysed as follows:
Loans and advances to
credit institutions
Loans and advances to
customers
Resources from credit
institutions
Resources from customers
2022
2021
2022
2021
2022
2021
2022
2021
EUR
2.44%
0.26%
5.15%
2.27%
3.38%
0.38%
2.77%
-0.21%
AOA
n.a.
23.15%
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
AUD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.76%
0.42%
CAD
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
5.11%
0.88%
CHF
n.a.
n.a.
4.48%
2.47%
n.a.
n.a.
1.58%
-0.32%
CNY
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
1.64%
2.19%
DKK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
2.77%
-0.20%
GBP
n.a.
n.a.
n.a.
n.a.
4.07%
n.a.
4.18%
0.47%
HKD
n.a.
n.a.
4.73%
0.80%
n.a.
n.a.
3.89%
0.02%
MOP
n.a.
n.a.
4.17%
1.19%
n.a.
n.a.
4.89%
0.28%
MZN
19.51%
14.78%
22.59%
17.96%
n.a.
n.a.
15.99%
11.25%
NOK
n.a.
n.a.
6.19%
n.a.
n.a.
n.a.
3.64%
1.33%
PLN
7.27%
2.11%
10.01%
7.24%
7.39%
3.71%
7.00%
2.43%
SEK
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
3.53%
0.29%
USD
5.41%
0.60%
5.74%
2.70%
5.52%
0.41%
4.51%
-0.11%
ZAR
8.61%
7.24%
13.05%
n.a.
n.a.
n.a.
5.45%
3.11%
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives), financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"), whenever
these are available. If market prices are not available, fair value is estimated through numerical models based on cash-
flow discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering the
volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the available
models do not fully apply to meet the characteristics of the financial instrument, specific quotations supplied by an
external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt securities
These financial instruments are accounted at amortised cost net of impairment. Fair value is based on market prices,
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical cash-
flow discounting techniques and models for assessment of options considering variables of the market, particularly the
interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
Debt securities non subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet reflected in
the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-accounting\", the fair value
related to the interest rate risk is already recognised. For the fair value calculation, other components of risk were
considered, in addition to the interest rate risk already recorded, when applicable. The fair value is based on market
prices, whenever these are available. If market prices are not available, fair value is estimated through numerical
models based on cash-flow discounting techniques, using the market interest rate curve adjusted by associated factors,
predominantly credit risk and trading margin, the latter only in the case of issues placed on non-institutional customers
of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps established
specifically for each term and class of instruments based on the market prices on equivalent instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the cost
obtained by distributing the respective instrument in the owned commercial network.
The average of the reference rates of the yield curve obtained from the market prices of the different currencies used
in the determination of the fair value of the\u00a0 issues is analysed as follows:
2022
2021
EUR
PLN
EUR
PLN
Placed in the institutional market
Subordinated
9.33%
\u2014
4.8%
\u2014
Senior
0.19%
\u2014
2.33%
\u2014
Covered bonds
\u2014
\u2014
-0.08%
\u2014
Placed in retail
Senior and collateralised
3.37%
6.19%
0.12%
3.63%
For non subordinated debt securities issued, the fair value calculation focused on all the components of these
instruments, as a result the difference determined is a positive amount of Euros 72,475,000 (31 December 2021: a
positive amount of Euros 11,616,000) and includes a payable amount of Euros 53,495,000 (31 December 2021: a payable
amount of Euros 6,365,000) which reflects the fair value of embedded derivatives and are recorded in financial assets
and liabilities held for trading (note 24 and 37).
The following table presents the interest rates used in the definition of the interest rate curves of main currencies,
namely EUR, USD, GBP and PLN used to determine the fair value of the financial assets and liabilities of the Group:
2022
2021
EUR
USD
GBP
PLN
EUR
USD
GBP
PLN
1 day
2.00%
4.45%
3.55%
6.76%
-0.59%
0.11%
0.19%
1.99%
7 days
2.00%
4.47%
3.58%
6.76%
-0.59%
0.14%
0.21%
1.99%
1 month
2.04%
4.57%
3.67%
6.83%
-0.56%
0.14%
0.25%
2.13%
2 months
2.13%
4.66%
3.80%
6.87%
-0.56%
0.16%
0.32%
2.28%
3 months
2.25%
4.77%
3.91%
6.92%
-0.56%
0.21%
0.38%
2.44%
6 months
2.73%
5.07%
4.32%
7.04%
-0.54%
0.33%
0.56%
2.74%
9 months
3.11%
5.28%
4.65%
7.09%
-0.51%
0.47%
0.76%
2.89%
1 year
3.26%
5.11%
4.87%
7.35%
-0.49%
0.52%
0.89%
3.71%
2 years
3.39%
4.69%
4.69%
6.97%
-0.30%
0.92%
1.20%
3.93%
3 years
3.31%
4.33%
4.56%
6.53%
-0.15%
1.15%
1.30%
3.88%
5 years
3.23%
4.02%
4.33%
6.20%
0.02%
1.34%
1.29%
3.74%
7 years
3.19%
3.89%
4.14%
6.13%
0.13%
1.45%
1.24%
3.63%
10 years
3.21%
3.82%
3.99%
6.20%
0.30%
1.56%
1.21%
3.54%
15 years
3.14%
3.79%
3.91%
6.45%
0.49%
1.68%
1.18%
3.74%
20 years
2.93%
3.72%
3.84%
6.49%
0.55%
1.74%
1.15%
3.86%
30 years
2.54%
3.48%
3.70%
6.49%
0.48%
1.72%
1.10%
3.86%
policy.
Thus, the fair value obtained is influenced by the parameters used in the evaluation model that have some degree of
judgment and reflects exclusively the value attributed to different financial instruments. However, it does not consider
prospective factors, as the future business evolution. Therefore, the values presented cannot be understood as an
estimate of the economic value of the Group.
The main methods and assumptions used in estimating the fair value for the financial assets and financial liabilities are
presented as follows:
Cash and deposits at Central Banks and Loans and advances to credit institutions repayable on
demand
Considering the short term of these financial instruments, the amount in the balance sheet is a reasonable estimate of
its fair value.
Loans and advances to credit institutions, Deposits from credit institutions and Assets with
repurchase agreements
The fair value of these financial instruments is calculated discounting the expected principal and interest future cash
flows for these instruments, considering that the payments of the instalments occur in the contractually defined dates.
This update is made based on the prevailing market rate for the term of each cash flow plus the average spread of the
production of the most recent 3 months of the same. For the elements with signs of impairment, the net impairment of
these operations is considered as a reasonable estimate of their fair value, considering the economic valuation that is
realized in the determination of this impairment.
For resources from Central Banks, it was considered that the book value is a reasonable estimate of its fair value, given
the nature of operations and the associated short-term. The rate of return of funding with the European Central Bank
was -0.6788%\u00a0 as at 31 December 2022 and -1% as at 31 December 2021.
For the remaining loans and advances and deposits, the discount rate used reflects the current conditions applied by
the Group on identical instruments for each of the different residual maturities (rates from the monetary market or
from the interest rate swap market).
Loans and advances to customers without defined maturity date
Considering the short maturity of these financial instruments, the conditions of the portfolio are similar to conditions
used at the date of the report. Therefore, the amount in the balance sheet is a reasonable estimate of its fair value.
Loans and advances to customers with defined maturity date
The fair value of these instruments is calculated by discounting the expected principal and interest future cash flows
for these instruments, considering that the payments of the instalments occur in the contractually defined dates. For
loans with signs of impairment, the net impairment of these operations is considered as a reasonable estimate of their
fair value, considering the economic valuation that is realized in the determination of this impairment.
The discount rate used is the one that reflects the current rates of the Group for each of the homogeneous classes of
this type of instruments and with similar residual maturity. The discount rate includes the market rates for the residual
maturity date (rates from the monetary market or from the interest rate swap market) and the spread used at the date
of the report, which was calculated from the average production of the three most recent months compared to the
reporting date.
Resources from customers and other loans
The fair value of these financial instruments is calculated by discounting the expected principal and interest future
cash flows for the referred instruments, considering that payments occur in the contractually defined dates. The
discount rate used reflects the current conditions applied by the Group in similar instruments with a similar maturity.
The discount rate includes the market rates of the residual maturity date (rates of monetary market or the interest
rate swap market, at the end of the period) and the actual spread of the Group. This was calculated from the average
production of the three most recent months compared to the reporting date.
Financial assets and liabilities measured at fair value through profit or loss (except
derivatives), financial assets at fair value through other comprehensive income
These financial instruments are accounted for at fair value. Fair value is based on market prices (\"Bid-price\"), whenever
these are available. If market prices are not available, fair value is estimated through numerical models based on cash-
flow discounting techniques, using the market interest rate curve adjusted for factors associated, predominantly credit
risk and liquidity risk, determined in accordance with the market conditions and time frame.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
When optionality is involved, the standard templates (Black-Scholes, Black, Ho and others) are used considering the
volatility areas applicable. Whenever there are no references in the market of sufficient quality or that the available
models do not fully apply to meet the characteristics of the financial instrument, specific quotations supplied by an
external entity are applied, typically a counterparty of the business.
Financial assets measured at amortised cost - Debt securities
These financial instruments are accounted at amortised cost net of impairment. Fair value is based on market prices,
whenever these are available. If market prices are not available, fair value is estimated through numerical models
based on cash-flow discounting techniques, using the market interest rate curve adjusted for factors associated,
predominantly credit risk and liquidity risk, determined in accordance with the market conditions and time frame.
Hedging and trading derivatives
All derivatives are recorded at fair value. In case of derivative contracts that are quoted in organised markets their
market prices are used. As for derivatives traded \"Over-the-counter\", it is applied methods based on numerical cash-
flow discounting techniques and models for assessment of options considering variables of the market, particularly the
interest rates on the instruments in question, and where necessary, their volatilities.
Market interest rates are determined based on information released by the suppliers of financial content - Reuters and
Bloomberg - more specifically because of prices of interest rate swaps. The values for the very short-term rates are
obtained from similar sources but regarding interbank money market. The interest rate curve obtained is calibrated
with the values of interest rate short-term futures. Interest rates for specific periods of the cash flows are determined
by appropriate interpolation methods. The same interest rate curves are used in the projection of the non-
deterministic cash flows such as indexes.
Debt securities non subordinated issued and subordinated debt
For these financial instruments the fair value was calculated for components for which fair value is not yet reflected in
the balance sheet. Fixed rate remunerated instruments for which the Group adopts \"hedge-accounting\", the fair value
related to the interest rate risk is already recognised. For the fair value calculation, other components of risk were
considered, in addition to the interest rate risk already recorded, when applicable. The fair value is based on market
prices, whenever these are available. If market prices are not available, fair value is estimated through numerical
models based on cash-flow discounting techniques, using the market interest rate curve adjusted by associated factors,
predominantly credit risk and trading margin, the latter only in the case of issues placed on non-institutional customers
of the Group.
As original reference, the Group applies the curves resulting from the market interest rate swaps for each specific
currency. The credit risk (credit spread) is represented by an excess from the curve of interest rate swaps established
specifically for each term and class of instruments based on the market prices on equivalent instruments.
For own issued debts placed among non-institutional customers of the Group, one more differential was added
(commercial spread), which represents the margin between the financing cost in the institutional market and the cost
obtained by distributing the respective instrument in the owned commercial network.
The Group classified the financial instruments recorded in the balance sheet at fair value in accordance with the
hierarchy established in IFRS 13. The fair value of financial instruments is determined using quotations recorded in
active and liquid markets, considering that a market is active and liquid whenever its stakeholders conduct transactions
on a regular basis giving liquidity to the instruments traded. When it is verified that there are no transactions that
regularly provide liquidity to the traded instruments, valuation methods and techniques are used to determine the fair
value of the financial instruments.
Level 1 - With quotation in active market
In this category are included, in addition to financial instruments traded on a regulated market, bonds and units of
investment funds valued based on the prices disclosed through trading systems.
\u00a0The classification of the fair value of level 1 is used when:
i) - There is a firm daily enforceable quotation for the financial instruments concerned, or;
ii) - There is a quotation available in market information systems that aggregate multiple prices of various stakeholders,
or;
iii) - Financial instruments have been classified in level 1, at least 90% of trading days in the year (at the valuation
date).
Level 2 - Valuation methods and techniques based on market data
Financial instruments, when there are no regular transactions in the active and liquid markets (level 1), are classified in
level 2, according to the following rules:
i) - Failure to comply with the rules defined for level 1, or;
ii) - They are valued based on valuation methods and techniques that use mostly observable market data (interest rate
or exchange rate curves, credit curves, etc.).
Level 2 includes over-the-counter derivative financial instruments contracted with counterparties with which the Bank
maintains collateral agreements (ISDAs with Credit Support Annex (CSA)), in particular with MTA (Minimum Transfer
Amount) which contributes to the mitigation of the counterparty credit risk, so that the CVA (Credit Value Adjustment)
component is not significant. In addition, derivative financial instruments traded in the over-the-counter market,
which, despite not having CSA agreements, the non-observable market data component (i.e. internal ratings, default
probabilities determined by internal models, etc.) incorporated in valuation of CVA is not significant in the value of the
derivative as a whole. In order to assess the significance of this component, the Bank defined a quantitative relevance
criterion and performed a qualitative sensitivity analysis on the valuation component that includes unobservable
market data.
Level 3 - Valuation methods and techniques based on data not observable in the market
If the level 1 or level 2 criteria are not met, financial instruments should be classified in level 3, as well as in situations
where the fair value of financial instruments results from the use of information not observable in the market, such as:
- financial instruments which are not classified as level 1 and which are valued using evaluation methods and
techniques without being known or where there is consensus on the criteria to be used, namely:
i) - They are valued using comparative price analysis of financial instruments with risk and return profile, typology,
seniority or other similar factors, observable in the active and liquid markets;
ii) - They are valued based on performance of impairment tests, using performance indicators of the underlying
transactions (e.g. default probability rates of the underlying assets, delinquency rates, evolution of the ratings, etc.);
iii) - They are valued based on NAV (Net Asset Value) disclosed by the management entities of securities/real estate/
other investment funds not listed on a regulated market.
Level 3 includes over-the-counter derivative financial instruments that have been contracted with counterparties with
which the Bank does not maintain collateral exchange agreements - CSA), and whose unobservable market data
component incorporated in the valuation of CVA is significant in the value of the derivative as a whole. In order to
assess the significance of this component, the Bank defined a quantitative relevance criterion and performed a
qualitative sensitivity analysis on the valuation component that includes unobservable market data.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForFairValueMeasurementExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-696": { "value": "Post-employment benefits and other long-term benefits
The Group assumed the liability to pay to their employees' pensions on retirement or disability and other obligations, in
accordance with the accounting policy described in note 1 R.
As at 31 December 2022 and 2021, the number of participants in the Pension Fund of Banco Comercial Portugu\u00eas
covered by this pension plan and other benefits is analysed as follows:
Number of participants
2022
2021
Pensioners
17,111
17,177
Former Attendees Acquired Rights
3,495
3,539
Employees
6,370
6,407
26,976
27,123
benefits and the respective coverage, based on the Projected Unit Credit method are analysed as follows:
(Thousands of euros)
2022
2021
Actual amount of the past services
Pensioners
2,126,809
2,454,361
Former attendees acquired rights
161,387
255,662
Employees
502,428
787,599
2,790,624
3,497,622
Pension fund value
(3,384,118)
(3,699,988)
Net (assets) / liabilities in balance sheet (note 32)
(593,494)
(202,366)
Accumulated actuarial deviations and changing assumptions
effect recognised in Other comprehensive income
3,152,535
3,528,224
In 2017, following the authorization of the Insurance and Pension Funds Supervisory Authority, the BCP group's pension
fund agreement was amended. The main purpose of this process was to incorporate into the pension fund the changes
made to the Group's Collective Labour Agreement (CLA) in terms of retirement benefits and to pass on to the pension
fund the responsibilities that were directly in charge by the companies (extra-fund liabilities). The pension fund has a
share exclusively related to the financing of these liabilities, which under the scope of the fund is called an Additional
Complement, which as at 31 December 2022 amounts to Euros 197,486,000 (31 December 2021: Euros 260,168,000).
The End of Career Premium also came to be borne by the pension fund under the basic pension plan.
In 2022, negotiations continued with all the unions subscribing to the Group's Collective Labour Agreements, for the
conclusion of the full review of the respective clauses, negotiations which are still ongoing.
At the same time, negotiations took place with all the unions subscribed to the Group's Collective Labour Agreements
for the revision of the Salary Tables and other clauses of pecuniary expression relative to the years of 2021 and 2022,
having been agreed on 20 June and 1 July with all the unions subscribed to the Group's Collective Labour Agreements,
the update of the Salary Tables and the Bank's Contributions to SAMS in 2021 by 0.50%, and the increase of 0.50% of
other clauses of pecuniary expression, such as lunch subsidy, diuturnities, among others. The agreed updates take
effect on 1 January 2021, with the exception of compensation for subsistence and travel allowances, which will be
updated after the agreed updates are operational.
Regarding the revision of the Salary Tables and other clauses of pecuniary expression for 2022, it was agreed on 20 June
with the unions \"Mais Sindicato do Sector Financeiro\", \"SBC \u2013 Sindicato Banc\u00e1rios do Centro\" and \"SBN - Sindicato dos
Trabalhadores do Sector Financeiro de Portugal\", the update of Salary Tables by 1.10% up to and including level 13, and
0.70% for level 14 and beyond. An increase of 1.10% was agreed for the Bank's contributions to SAMS and other
pecuniary expression clauses, and an increase of 7.14% was agreed for the lunch subsidy, whose daily value was
increased to Euros 10.50. The agreed updates were effective on 1 January 2022, with exception of compensation for
subsistence and travel allowances, which were effective after the agreed updates became operational.
Regarding \"SNQTB \u2013 Sindicato Nacional dos Quadros e T\u00e9cnicos Banc\u00e1rios\", \"SIB \u2013 Sindicato Independente da Banca\", an
agreement has not yet been reached on the proposal presented by the Group on 22 June, the content of which
corresponds to what was agreed with the other unions, hence the negotiations are still ongoing. Although no agreement
has yet been reached with these unions, all Bank employees benefit from the same conditions.
The change in the projected benefit obligations is analysed as follows:
(Thousands of euros)
2022
2021
Balance as at 1 January
3,497,622
3,657,527
Service cost
(11,727)
(14,466)
Interest cost / (income)
67,059
43,034
Actuarial losses / (gains)
Not related to changes in actuarial assumptions
58,590
57,564
Related to changes in assumptions
(693,673)
(167,476)
Payments
(136,338)
(122,563)
Early retirement programmes and terminations by mutual agreement
2,223
36,583
Contributions of employees
6,868
7,451
Transfer from / (to) other plans
\u2014
(32)
Balance at the end of the year
2,790,624
3,497,622
As at 31 December 2022, the pensions paid by the Fund, including the Additional Complement, amounts to Euros
136,338,000 (31 December 2021: Euros 122,563,000).
The liabilities with health benefits are fully covered by the Pension Fund and correspond to Euros 241,345,000 as at 31
December 2022 (31 December 2021: Euros 311,161,000).
Additionally, regarding the coverage of some benefit obligations related to pensions, the Bank contracted with
Ocidental Vida the acquisition of perpetual annuities for which the total liability as at 31 December 2022 amounts to
Euros 39.093,000 (31 December 2021: Euros 40,811,000), in order to pay:
i) pensions of former Group's Board Members in accordance with the Bank's Board Members Retirement Regulation;
ii) pensions and complementary pensions to pensioners in accordance with the Pension Fund of the BCP Group
employees established in 28 December 1987, as also to pensioners, in accordance with other Pension Funds, that were
incorporated after on the BCP Group Pension Fund and which were planed that the retirement benefits should be paid
through the acquisition of insurance policies, in accordance with the Decree - Law no. 12/2006.
Ocidental Vida is 100% owned by Ageas Group and Ageas Group is 49% owned by the BCP Group.
During 2022 and 2021, the changes occurred in the plan's assets value is analysed as follows:
(Thousands of euros)
2022
2021
Balance as at 1 January
3,699,988
3,750,567
Employees' contributions
6,868
7,451
Actuarial gains / (losses)
(259,394)
25,374
Payments
(136,338)
(122,563)
Expected return on plan assets
72,988
38,606
Amount transferred to the Fund resulting from acquired rights unassigned
related to the Complementary Plan
6
586
Others
\u2014
(33)
Balance at the end of the year
3,384,118
3,699,988
(Thousands of euros)
2022
2021
Asset class
Assets with
market price in
active market
Remaining
Total
Portfolio
Assets with
market price in
active market
Remaining
Total
Portfolio
Shares
96,817
1,183
98,000
397,322
1,098
398,420
Bonds and other fixed income
securities
1,120,132
\u2014
1,120,132
1,377,330
4,820
1,382,150
Participations units in
investment funds
\u2014
969,232
969,232
\u2014
1,186,146
1,186,146
Participation units in real
estate funds
\u2014
308,404
308,404
\u2014
304,736
304,736
Properties
\u2014
275,493
275,493
\u2014
239,838
239,838
Loans and advances to credit
institutions and others
\u2014
612,857
612,857
\u2014
188,698
188,698
1,216,949
2,167,169
3,384,118
1,774,652
1,925,336
3,699,988
As at 31 December 2022, the balance Properties includes buildings booked in the Fund's financial statements and used
by the Group's companies which amounts to Euros 275,493,000 (31 December 2021: Euros 239,838,000).
The securities issued by Group's companies accounted in the portfolio of the Fund are analysed as follows:
(Thousands of euros)
2022
2021
Shares
4,301
4,140
Bonds and other fixed income securities
2,805
15,386
Loans and advances to credit institutions and others
128,476
170,115
135,582
189,641
Social Security System (RGSS) with effect from 1 January 2011. The integration led to an effective decrease in the
present value of the total benefits reported at the retirement age to be borne by the Pension Fund, and this effect is
recorded on a straight-line basis over the average period of active life until the normal retirement age is reached. The
calculation of the liability for pensions carried out periodically by the actuary considers this effect and is calculated
considering the actuarial assumptions in force, ensuring that the liabilities calculated with reference to 31 December
2010, not considering the effect of the integration of bank employees into the General Social Security Scheme are fully
covered and deducted from the amount of the effect recognised until the date. The component of this effect for the
year is recognised under the heading \"Current service costs\".
Board of Directors Plan
As the Board of Directors Retirement Regulation establish that the pensions are subjected to an annual update, and as
it is not common in the insurance market the acquisition of perpetual annuities including variable updates in pensions,
the Bank determined, the liability to be recognised on the financial statements related to that update, taking into
consideration current actuarial assumptions.
In accordance with the remuneration policy of the Board Members, the Group has the responsibility of supporting the
cost with: i) the retirement pensions of former Group's Executive Board Members; and ii) the Complementary Plan for
these members in accordance with the applicable rules funded through the Pension Fund, Extra-fund and perpetual
annuities.
In order to cover liabilities with pensions to former members of the Executive Board of Directors, under the Bank's
Board of Directors Retirement Regulation the Bank contracted with Ocidental Vida to purchase immediate life annuity
insurance policies.
Assumptions used in the liability's assessment
Considering the market indicators, particularly the inflation rate estimates and the long-term interest rate for Euro
Zone, as well as the demographic characteristics of its employees, the Group considered the following actuarial
assumptions for calculating the liabilities with pension obligations:
2022
2021
Salary growth rate (c)
3,75% in 2023; 2,25% in\u00a0
2024 and 1% in the
following years
0.75%
Pension's growth rate (c)
3,5% in 2023; 2% in\u00a0 2024
and 0.75% in the following
years
0.50%
Discount rate / Projected Fund's rate of return
4.17%
1.35%
Mortality tables
Men
TV 88/90 less a year
TV 88/90
Women (a)
TV 99/01 less 2 years
TV 88/90 less 3 years
Disability rate
Non applicable
Non applicable
Turnover rate
Non applicable
Non applicable
Normal retirement age (b)
66 years and 7 months
66 years and 6 months
Total salary growth rate for Social Security purposes
1.75%
1.75%
Revaluation rate of wages / pensions of Social Security
1%
1%
employees and managers, was determined based on an analysis carried out on a set of available information, which
includes, among other elements, the market references for this indicator published by internationally recognized
specialized entities and which are based, as defined by IAS 19, on market yields of a universe of high quality bond
issues (low risk), different maturities, called in Euros and relating to a diverse and representative range of issuers (non-
sovereign). With reference to 31 December 2022, the Group used a discount rate of 4.17%% (31 December 2021: 1.35%
%).
The Actuarial gains are related to the difference between the actuarial assumptions used for the estimation of the
liabilities and the values verified and the change in actuarial assumptions, are analysed as follows:
(Thousands of euros)
Actuarial (gains) / losses
2022
2021
Values
effectively
verified in %
Amount
of
deviations
Values
effectively
verified in %
Amount
of
deviations
Deviation between expected and actual liabilities
58,590
57,564
Changes on the assumptions:
Discount rate
(1,108,506)
(167,475)
\u00a0 Salary and pensions growth rate
279,108
\u2014
\u00a0 Mortality tables
63,571
\u2014
\u00a0 Other changes
72,154
\u2014
Deviation between expected income and income from funds
-5.07%
259,394
1.92%
(25,374)
\u2014
(375,689)
\u2014
(135,285)
(98,276)
102,703
(143,548)
151,248
Salary growth rate
(20,620)
23,675
(32,795)
35,922
(Thousands of euros)
Impact resulting from changes in demographic assumptions
2022
2021
- 1 year
+ 1 year
- 1 year
+ 1 year
Changes in mortality table (*)
83,017
(83,816)
128,401
(127,687)
(*) The impact of 1 year reduction in the mortality table implies an increase in the average life expectancy
Defined contribution plan
According to what is described in accounting policy 1 R3, in the scope of the Defined Contribution Plan provided for the
BCP Pension Fund of the BCP Group for employees who have been admitted until 1 July 2009, in 2022 was accounted for
a cost of Euros 2 million as an estimated contribution given that the Group estimates that the following requirements
will me met, cumulatively: (i) the previous year BCP's ROE equals or exceeds the rate of government bonds of 10 years
plus 5 percentage points, and (ii) distributable profits or reserves exist in the accounts of Banco Comercial Portugu\u00eas.
No contributions were made in 2021.
For employees who have been admitted after 1 July 2009, are made monthly contributions equal to 1.5% of the monthly
remuneration received by employees in the current month, either by themselves or by the Group and employees. This
contribution has a mandatory character and is defined in the Collective Labour Agreement of the BCP Group and does
not have a performance criterion. The Group accounted for staff costs in 2022 the amount of Euros 307,000 (2021:
Euros 268,000) related to this contribution.
Transactions with the Pension Fund
The balances with the Pension Fund included in items of the consolidated balance sheet are as follows:
(Thousands of euros)
2022
2021
Assets
Financial assets held for trading
209
711
209
711
Liabilities
Resources from customers
145,303
173,377
Non subordinated debt securities issued
13,199
29,144
Financial liabilities held for trading
3,475
\u2014
161,977
202,521
In 2022 and 2021, there were no transactions related to other financial instruments between the Group and the Pension
Fund.
In 2022 and 2021, income and expenses with the Pension Fund included in the items of the consolidated income
statement are as follows:
(Thousands of euros)
2022
2021
Income
Commissions
2,167
2,268
Expenses
Interest expense and similar charges
\u2014
1,114
Other administrative costs
14,227
14,231
14,227
15,345
The balance Other administrative costs corresponds to rents incurred under the scope of the Pension Fund's properties
in which the tenant is the Group.
As at 31 December 2022 and 2021, the guarantees granted by the Group to the Pension Fund amount to Euros 5,000.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEmployeeBenefitsExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-697": { "value": "Related parties
As defined by IAS 24, are considered related parties of the Group, the companies detailed in note 60 - List of subsidiary
and associated companies of Banco Comercial Portugu\u00eas Group, the Pension Fund, the members of the Board of
Directors and key management members. The key management members are the first line Directors. Beyond the
members of the Board of Directors and key management members, are also considered related parties, people who are
close to them (family relationships) and entities controlled by them or in whose management they have significant
influence.
As the transactions with subsidiaries are eliminated in consolidation, these are not included in the notes to the Group's
consolidated financial statements.
According to Portuguese law, namely under Article no. 109 of the General Law for Credit Institutions and Financial
Companies and also in accordance with Article no. 33 of Notice 3/2020 of the Bank of Portugal, are considered related
parties as well, the qualified shareholders of Banco Comercial Portugu\u00eas, S.A. and the entities controlled by them or
with which they are in a group relationship. Under the scope of the Portuguese Securities Code update, which came
into force at the beginning of 2022, the reference threshold of 2% for qualifying holdings was changed to 5%. With
reference to 2021 financial year, the reported balances refer to qualifying holdings above 2%, in accordance with the
Securities Code in force at the date. The list of the qualified shareholders is detailed in note 41.
A)Balances and transactions with qualified shareholders
The balances reflected in assets of consolidated balance sheet with qualified shareholders, are analysed as follows:
(Thousands of euros)
2022
2021
Assets
Financial assets at amortised cost
Loans and advances to customers
97,744
148,916
Debt securities
79,787
79,673
Financial assets at fair value through profit or loss
Financial assets held for trading
\u2014
2,881
Financial assets at fair value through other comprehensive income
\u2014
136,849
Others
\u2014
48
177,531
368,367
Liabilities
Resources from customers
96,159
319,137
Financial liabilities at fair value through profit or loss
Financial liabilities held for trading
4,287
\u2014
100,446
319,137
The balances with qualified shareholders, reflected in the guarantees granted and revocable and irrevocable credit
lines, are as follows:
(Thousands of euros)
2022
2021
Guarantees granted
2,273
48,060
Revocable credit lines
18,171
143,225
Irrevocable credit lines
\u2014
150,000
20,444
341,285
In 2022, the Group has accounted for provisions for Guarantees granted the amount of Euros 3,000 (31 December 2021:
Euros 86,000), for Revocable credit lines the amount of Euros 229,000 (31 December 2021: Euros 184,000). As at 31
December 2021, were also accounted for provisions for irrevocable credit lines in the amount of\u00a0 Euros 26,000.
B)Balances and transactions with members of the Board of Directors and key management
members
The balances with related parties discriminated in the following table, included on the consolidated balance sheet, are
analysed as follows:
(Thousands of euros)
Loans and advances to customers
Resources from customers
2022
2021
2022
2021
Board of Directors
Non-executive directors
10
2
8,180
7,272
Executive Committee (*)
46
65
2,716
1,628
Closely related people
14
230
2,629
2,210
Controlled entities
\u2014
\u2014
24
45
Key management members
Key management members
6,575
6,114
10,180
9,996
Closely related people
2,475
1,146
4,497
5,224
Controlled entities
928
2
2,613
2,232
10,048
7,559
30,839
28,607
(*) The item Loans to Customers corresponds to mortgage loans granted prior to the respective election and to the
amount used from private credit cards which must be settled on the maturity date.
In accordance with Article 85, no. 9 of RGICSF, no credits were granted during 2022 and 2021.
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in income items
of the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar income
Commissions income
2022
2021
2022
2021
Board of Directors
Non-executive directors
\u2014
\u2014
29
46
Executive Committee
\u2014
\u2014
10
9
Closely related people
\u2014
3
9
6
Key management members
Key management members
41
23
62
62
Closely related people
22
9
43
38
Controlled entities
17
\u2014
19
8
80
35
172
169
In 2022 and 2021, the transactions with related parties discriminated in the following table, included in cost items of
the consolidated income statement, are as follows:
(Thousands of euros)
Interest and similar expense
Commissions' expense
2022
2021
2022
2021
Board of Directors
Non-executive directors
19
4
\u2014
1
Executive Committee
\u2014
\u2014
1
\u2014
Closely related people
9
1
\u2014
\u2014
Key management members
Key management members
6
6
4
4
Closely related people
2
1
2
1
Controlled entities
\u2014
\u2014
2
2
36
12
9
8
(*) Corresponds to the maximum authorized and unused limit of private credit cards and overdraft authorization in a
salary account under the same regime as all the Bank's other employees.
The shareholder and bondholder position of members of the Board of Directors, Key management members and people
closely related to the previous categories, as well as the movements occurred during 2022, are as follows:
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2022
2021
Acquisitions
Disposals
Date
MEMBERS OF BOARD OF DIRECTORS
Altina de F\u00e1tima Sebasti\u00e1n Gonz\u00e1lez Villamarin
BCP Shares
0
0
Ana Paula Alcobia Gray
BCP Shares
0
0
Cid\u00e1lia Maria da Mota Lopes
BCP Shares
2,184
2,184
Fernando da Costa Lima
BCP Shares
18,986
18,986
Jo\u00e3o Nuno Oliveira Jorge Palma
BCP Shares
1,364,642
426,957
1,662,562
(a)
724,877
(b)
24/6/2022
0.1775
Jorge Manuel Baptista Magalh\u00e3es Correia
BCP Shares
88,500
88,500
Bonds (i)
1
1
Bonds (ii)
1
1
Jos\u00e9 Miguel Bensliman Schorcht da Silva
Pessanha
BCP Shares
1,177,152
333,829
1,500,574
(a)
657,251
(b)
24/6/2022
0.1775
Jos\u00e9 Pedro Rivera Ferreira Malaquias
BCP Shares
9,808
9,808
J\u00falia Gu (Xiao Xu Gu)
BCP Shares
0
0
Lingjiang Xu
BCP Shares
0
0
Lingzi Yuan (Smilla Yuan)
BCP Shares
0
0
Maria Jos\u00e9 Henriques Barreto de Matos de
Campos
BCP Shares
1,554,512
396,914
1,446,998
(a)
289,400
(b)
24/6/2022
0.1775
Miguel de Campos Pereira de Bragan\u00e7a
BCP Shares
1,725,908
763,422
1,685,613
(a)
723,127
(b)
24/6/2022
0.1775
Miguel Maya Dias Pinheiro
BCP Shares
2,018,854
800,692
2,118,541
(a)
900,379
(b)
24/6/2022
0.1775
Nuno Manuel da Silva Amado
BCP Shares
1,525,388
1,525,388
Bonds (i)
2
2
Bonds (ii)
2
2
Bonds (iii)
1
0
1
7/11/2022
100,000
Rui Manuel da Silva Teixeira
BCP Shares
1,207,858
376,663
1,478,995
(a)
647,800
(b)
24/6/2022
0.1775
Valter Rui Dias de Barros
BCP Shares
0
0
KEY MANAGEMENT MEMBERS
Albino Ant\u00f3nio Carneiro de Andrade
BCP Shares
128,684
101,557
27,127
(a)
24/6/2022
0.1775
Alexandre Manuel Casimiro de Almeida
BCP Shares
111,400
55,865
55,535
(a)
24/6/2022
0.1775
Am\u00e9rico Jo\u00e3o Pinto Carola
BCP Shares
104,945
61,269
77,439
(a)
33,763
(b)
24/6/2022
0.1775
Ana Maria Jord\u00e3o F. Torres Marques Tavares
BCP Shares
215,340
161,758
84,249
(a)
30,667
(b)
24/6/2022
0.1775
Ana Patr\u00edcia Moniz Macedo
BCP Shares
0
0
Andr\u00e9 Cardoso Meneses Navarro
BCP Shares
148,020
106,697
55,098
(a)
13,775
(b)
24/6/2022
0.1775
Ant\u00f3nio Augusto Amaral de Medeiros
BCP Shares
143,063
100,077
76,485
(a)
33,499
(b)
24/6/2022
0.1775
Ant\u00f3nio Ferreira Pinto J\u00fanior
BCP Shares
33,187
27,266
1/4/2022
0.1492
11,842
5,921
(a)
24/6/2022
0.1775
Ant\u00f3nio Jos\u00e9 Lindeiro Cordeiro
BCP Shares
64,134
32,631
52,770
(a)
21,267
(b)
24/6/2022
0.1775
Ant\u00f3nio Lu\u00eds Duarte Bandeira
BCP Shares
285,425
236,233
87,529
(a)
38,337
(b)
24/6/2022
0.1775
Ant\u00f3nio Ricardo Fery Salgueiro Antunes
BCP Shares
61,361
15,035
46,326
(a)
24/6/2022
0.1775
Ant\u00f3nio V\u00edtor Martins Monteiro
BCP Shares
3,872
3,872
(i) - Tejo Project - Fixed Rate Reset Perpetual Temporary Write Down Additional Tier 1 Capital Notes
(ii) - BCP Tier 2 Subordinated Callable Notes
(iii) - BCP 1.75% EUR 500M 6.5NC5.5 Social Senior Preferred Notes
(a) - identifies the increment of shares up to 31 December 2022 corresponding to variable compensation of 2021 and deferred from previous years
(b) - identifies the shares used in sell-cover up to 31 December 2022 related to the increment of shares of variable remuneration.
Number of securities
Unit
price
Euros
Shareholders/Bondholders
Security
2022
2021
Acquisitions
Disposals
Date
Artur Frederico Silva Luna Pais
BCP Shares
459,405
396,760
62,645
(a)
24/6/2022
0.1775
Belmira Abreu Cabral
BCP Shares
96,604
57,285
62,410
(a)
23,091
(b)
24/6/2022
0.1775
Bernardo Roquette de Arag\u00e3o de Portugal
Colla\u00e7o
BCP Shares
54,362
25,999
49,673
(a)
21,310
(b)
24/6/2022
0.1775
Chi Wai Leung (Timothy)
BCP Shares
26,582
9,852
16,730
(a)
24/6/2022
0.1775
Constantino Alves Mousinho
BCP Shares
40,664
19,591
(a)
24/6/2022
0.1775
72,352
12,097
(a)
25/11/2022
0.1525
Fernando Maria Cardoso Rodrigues Bicho
BCP Shares
237
237
Filipe Maria de Sousa Ferreira Abecasis
BCP Shares
135,398
85,467
87,446
(a)
37,515
(b)
24/6/2022
0.1775
Francisco Ant\u00f3nio Caspa Monteiro
BCP Shares
186,219
137,027
87,529
(a)
38,337
(b)
24/6/2022
0.1775
Gon\u00e7alo Nuno Belo de Almeida Pascoal
BCP Shares
119,771
78,390
72,471
(a)
31,090
(b)
24/6/2022
0.1775
Hugo Miguel Martins Resende
BCP Shares
139,589
92,696
83,143
(a)
36,250
(b)
24/6/2022
0.1775
Jo\u00e3o Br\u00e1s Jorge
BCP Shares
91,709
91,709
Jo\u00e3o Manuel Rodrigues Tom\u00e9 Cunha Martins
BCP Shares
0
0
Jo\u00e3o Manuel Taveira Pinto Santos Paiva
BCP Shares
190,677
103,739
86,938
(a)
24/6/2022
0.1775
Jorge Filipe Nogueira Freire Cortes Martins
BCP Shares
38,003
79,632
(a)
31,375
(b)
24/6/2022
0.1775
48,257
38,003
6/7/2022
0.1454
Jorge Manuel Machado de Sousa G\u00f3is
BCP Shares
134,204
73,203
61,001
(a)
24/6/2022
0.1775
Jorge Manuel Magalh\u00e3es Oliveira Pereira
BCP Shares
25,460
0
44,355
(a)
18,895
(b)
24/6/2022
0.1775
Jorge Manuel Nobre Carreteiro
BCP Shares
55,988
27,648
47,471
(a)
19,131
(b)
24/6/2022
0.1775
Jorge Oct\u00e1vio Neto dos Santos
BCP Shares
471,191
471,191
Jos\u00e9 Artur Gouveia Coelho Caetano
BCP Shares
0
0
Jos\u00e9 Carlos Benito Garcia de Oliveira
BCP Shares
37,941
37,941
Jos\u00e9 Gon\u00e7alo Prior Regalado\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0
BCP Shares
163,020
83,836
79,184
(a)
24/6/2022
0.1775
Jos\u00e9 Guilherme Potier Raposo Pulido Valente
BCP Shares
280,081
208,437
71,644
(a)
24/6/2022
0.1775
Jos\u00e9 Laurindo Reino da Costa
BCP Shares
751,100
401,100
4/1/2022
0.1502
150,000
3/6/2022
0.1953
50,000
150,000
3/11/2022
0.1531
Jos\u00e9 Maria Gon\u00e7alves Pereira Brand\u00e3o de
Brito
BCP Shares
55,225
23,878
50,076
(a)
18,729
(b)
24/6/2022
0.1775
Luis Miguel Manso Correia dos Santos
BCP Shares
216,790
125,615
91,175
(a)
24/6/2022
0.1775
Maria Constan\u00e7a C. Brand\u00e3o Amado Fonseca
G. Santos
BCP Shares
800
800
Maria de F\u00e1tima Coelho Dias
BCP Shares
0
0
Maria de Los Angeles Sanchez Sanchez
BCP Shares
19,191
23,029
(a)
9,649
(b)
24/6/2022
0.1775
41,011
14,113
(a)
5,673
(b)
25/11/2022
0.1525
Maria Helena Soledade Nunes Henriques
BCP Shares
232,863
199,002
60,250
(a)
26,389
(b)
24/6/2022
0.1775
Maria Manuela de Ara\u00fajo Mesquita Reis
BCP Shares
190,663
152,857
63,327
(a)
25,521
(b)
24/6/2022
0.1775
Maria Rita S\u00edtima Fonseca Louren\u00e7o
BCP Shares
173,448
112,778
60,670
(a)
24/6/2022
0.1775
M\u00e1rio Ant\u00f3nio Pinho Gaspar Neves
BCP Shares
108,172
73,963
60,762
(a)
26,553
(b)
24/6/2022
0.1775
M\u00e1rio Madeira Robalo Fernandes
BCP Shares
156,951
79,512
77,439
(a)
24/6/2022
0.1775
Nelson Lu\u00eds Vieira Teixeira
BCP Shares
108,936
59,343
86,855
(a)
37,262
(b)
24/6/2022
0.1775
Nuno Alexandre Ferreira Pereira Alves
BCP Shares
183,959
101,156
82,803
(a)
24/6/2022
0.1775
Nuno Miguel Nobre Botelho
BCP Shares
33,366
72,259
(a)
24/6/2022
0.1775
85,625
20,000
29/8/2022
0.1400
Pedro Jos\u00e9 Mora de Paiva Beija
BCP Shares
107,673
28,000
18/5/2022
0.1720
29,000
20/5/2022
0.1700
138,202
87,529
(a)
24/062022
0.1775
(a) - identifies the increment of shares up to 31 December 2022 corresponding to variable compensation of 2021 and deferred from previous years.
(b) - identifies the shares used in sell-cover up to 31 December 2022 related to the increment of shares of variable remuneration.
(c) - solidary ownership in both securities accounts, and Dr. Ricardo Campos is the first holder and Eng.\u00aa Maria Jos\u00e9 Campos is the 2nd holder of the
securities account.
C)Balances and transactions with associated companies
The balances with associated companies included in the consolidated balance sheet items, except for the item
investments in associated companies, are as follows:
(Thousands of euros)
2022
2021
Assets
Loans and advances to credit institutions repayable on demand
8,834
2,130
Financial assets at amortised cost
Loans and advances to credit institutions
206,078
18,290
Loans and advances to customers
59,487
63,681
Financial assets at fair value through profit or loss
Financial assets held for trading
\u2014
35
Other assets
11,497
12,542
285,896
96,678
Liabilities
Financial liabilities at amortised cost
Resources from credit institutions
62,845
46,158
Resources from customers
211,193
346,254
Non subordinated debt securities issued
2,002
21,019
Financial liabilities held for trading
3,894
96,536
Other liabilities
8
51
279,942
510,018
The guarantees granted and revocable and irrevocable credit lines by the Group over associated companies are as
follows:
(Thousands of euros)
2022
2021
Guarantees granted
7,539
7,453
Revocable credit lines
9,527
335,367
Irrevocable credit lines
\u2014
600
17,066
343,420
Under the scope of the Group's insurance mediation activities, the remuneration from services provided is analysed as
follows:\u00a0
(Thousands of euros)
2022
2021
Life insurance
Saving products
27,966
32,101
Mortgage and consumer loans
20,699
19,333
Others
\u2014
30
48,665
51,464
Non-Life insurance
Accidents and health
21,612
20,144
Motor
3,956
4,078
Multi-Risk Housing
7,753
7,392
Others
1,660
1,549
34,981
33,163
83,646
84,627
In 2022 and 2021, there were no transactions related to other financial instruments between the Group and the Pension
Fund.
In 2022 and 2021, income and expenses with the Pension Fund included in the items of the consolidated income
statement are as follows:
(Thousands of euros)
2022
2021
Income
Commissions
2,167
2,268
Expenses
Interest expense and similar charges
\u2014
1,114
Other administrative costs
14,227
14,231
14,227
15,345
The balance Other administrative costs corresponds to rents incurred under the scope of the Pension Fund's properties
in which the tenant is the Group.
As at 31 December 2022 and 2021, the guarantees granted by the Group to the Pension Fund amount to Euros 5,000.
", "dimensions": { "concept": "ifrs-full:DisclosureOfRelatedPartyExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-698": { "value": "
As defined by IAS 24, are considered related parties of the Group, the companies detailed in note 60 - List of subsidiary
and associated companies of Banco Comercial Portugu\u00eas Group, the Pension Fund, the members of the Board of
Directors and key management members. The key management members are the first line Directors. Beyond the
members of the Board of Directors and key management members, are also considered related parties, people who are
close to them (family relationships) and entities controlled by them or in whose management they have significant
influence.
As the transactions with subsidiaries are eliminated in consolidation, these are not included in the notes to the Group's
consolidated financial statements.
According to Portuguese law, namely under Article no. 109 of the General Law for Credit Institutions and Financial
Companies and also in accordance with Article no. 33 of Notice 3/2020 of the Bank of Portugal, are considered related
parties as well, the qualified shareholders of Banco Comercial Portugu\u00eas, S.A. and the entities controlled by them or
with which they are in a group relationship. Under the scope of the Portuguese Securities Code update, which came
into force at the beginning of 2022, the reference threshold of 2% for qualifying holdings was changed to 5%. With
reference to 2021 financial year, the reported balances refer to qualifying holdings above 2%, in accordance with the
Securities Code in force at the date. The list of the qualified shareholders is detailed in note 41.
", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForTransactionsWithRelatedPartiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-699": { "value": "Consolidated Balance sheet and Income statement by geographic and
operational segments
The segments presented are in accordance with IFRS 8. In accordance with the Group's management model, the
segments presented correspond to the segments used for management purposes by the Executive Committee. The
Group offers a wide range of banking activities and financial services in Portugal and abroad, with a special focus on
Commercial Banking, Companies Banking and Private Banking.
Segments description
A.Geographical Segments
The Group operates in the Portuguese market, and also in a few affinity markets with recognised growth potential.
Considering this, the geographical segments are structured in Portugal and Foreign Business (Poland, Mozambique and
Other). Portugal segment reflects, essentially, the activities carried out by Banco Comercial Portugu\u00eas in Portugal and
ActivoBank.
Portugal activity includes the following segments: i) Retail Banking; ii) Companies, Corporate & Investment Banking; iii)
Private Banking and iv) Other.
Retail Banking includes the following business areas:
- Retail network, which ensures the monitoring of individual customers, entrepreneurs, merchants and small and
medium enterprises with a turnover less than Euros 2.5 million. The Retail network strategic approach is to target
\u201cMass Market\u201d customers, who appreciate a value proposal based on innovation and speed, as well as Prestige and
Small Business customers, whose specific characteristics, financial assets or income imply a value proposal based on
innovation and personalisation, requiring a dedicated Account Manager;
- Retail Recovery Division that accompanies and manages the responsibilities of customers or economic groups in
effective default, as well as customers with bankruptcy requirement or other similar mechanisms, looking through the
conclusion of agreements or payment restructuring processes that minimizes the economic loss to the Bank; and
- ActivoBank, a bank focused on clients who are young, intensive users of new communication technologies and who
prefer a banking relationship based on simplicity, offering modern products and services.
Companies, Corporate and Investment Banking segment includes:
- Companies and Corporate network, which monitors clients included in the corporate segment, economic groups and
institutional entities, with a turnover higher than Euros 2.5 million, offering a wide range of traditional banking
products complemented by specialised financing;
- Large Corporate network that assures the relationship and the monitoring of a set of Groups / Clients, which in
addition to Portugal, develop their activity in several geographies (Poland, Angola, Mozambique and East), providing a
complete range of value-added products and services;
- Specialised Monitoring Division which carries out the monitorisation of business groups that have high and complex
credit exposures or that show relevant signs of impairment, in order to defend the value and managing credit risk, in
a sustainable medium and long term perspective;
- Investment Banking unit, that ensures the offer of products and specific services, in particular financial advice,
including corporate finance services, capital market transactions and analysis and financing structuring in the medium
to long term;
- Trade Finance Department (from Marketing Division for Corporate, Business and Institutional since the end of 2021),
which coordinates the business with banks and financial institutions, boosting international business with the
commercial networks of the Bank and institutional custody services for securities;
- Specialised Recovery Division which ensures efficient tracking of customers with predictable or effective high risk of
credit, from Companies, Corporate, Large Corporate and retail networks (exposure exceeding Euros 1 million);
- Interfundos with the activity of management of real estate investment funds.
The Private Banking segment, for the purposes of geographical segments, comprises:
- Private Banking Division in Portugal, which ensures the monitoring of clients with high net worth, based on a
commitment to excellence and a personalized relationship with clients;
- Wealth Management Division, which provides advisory services and portfolio management for clients in the Private
Banking network and the affluent segment.
For the purposes of business segments also includes Banque Priv\u00e9e BCP in Switzerland and Millennium bcp Bank & Trust
in Cayman Islands (entity liquidated in 2022) that are considered Foreign Business on geographical segmentation. It
should be noted that the result generated by the subsidiary in Switzerland and the capital gain generated by
discontinuing this operation, as well as its adjustments occurred in 2022, are recorded in a single line as results of
discontinued or discontinuing operations.
All other businesses not previously discriminated are allocated to the Other segment (Portugal) and include centralized
management of financial investments, corporate activities and operations not integrated in the remaining business
segments and other amounts not allocated to segments.
Foreign Business includes the following segments:
- Poland, where the Group is represented by Bank Millennium, a universal bank offering a wide range of financial
products and services to individuals and companies nationwide;
- Mozambique, where the Group is represented by BIM \u2013 Banco Internacional de Mo\u00e7ambique, a universal bank targeting
companies and individual customers; and
- Other, which includes the contribution of the associate in Angola and the contribution of the discontinued operations
in Switzerland and Cayman Islands.
B.Business Segments
For the purposes of business segments reporting, Foreign Business segment comprises the Group\u2019s operations developed
in other countries already mentioned excluding the activity of Banque Priv\u00e9e BCP in Switzerland and Millennium bcp
Bank & Trust in the Cayman Islands which, in this context, are considered in Private Banking segment.
Business segments activity
The figures reported for each segment resulted from aggregating the subsidiaries and business units integrated in each
segment. For the business units in Portugal, the aggregation process reflects the impact from capital allocation and
balancing process in the balance sheet and income statement, based on average figures. The balance sheet headings
for each business unit and Portuguese subsidiaries were re-calculated, considering the replacement of the equity book
values by the amounts assigned through the allocation process, based on the regulatory solvency criteria.
Considering that the process of capital allocation complies with the regulatory criteria of solvency in force, as at 31
December 2022 and 31 December 2021 the risk weighted assets, and consequently the capital allocated to the business
segments, are determined in accordance with the Basel III framework, pursuant to the CRD IV/CRR. The capital
allocated to each segment resulted from the application of a target capital ratio to the risks managed by each segment,
reflecting the application of the Basel III methodology previously referred. Each operation is balanced through internal
transfers of funds, with impact on the net interest income and income taxes of each segment, hence with no impact on
consolidated accounts.
Commissions and other net income, as well as operating costs calculated for each business area, are based on the
amounts accounted for directly in the respective cost centres, on the one hand, and the amounts resulting from
internal processes for allocating revenues and costs, for another. In this case, the allocation is based on the application
of pre-defined criteria related to the level of activity of each business area.
The following information has been prepared based on the individual and consolidated financial statements of the
Group prepared in accordance with international financial reporting standards (IFRS), as adopted by the European
Union (EU), at the reference date and with the Organization of the Group's business areas in force on 31 December
2022. Information relating to prior periods is restated whenever it occurs changes in the internal organization of the
entity susceptible to change the composition of the reportable segments (business and geographical) or relevant
changes in the dynamics of allocation of indirect revenues and costs, as described in the previous paragraph, ensuring
the comparability of the information provided in the reported periods.
Following the sale of the entire share capital of Banque Priv\u00e9e BCP (Suisse) SA (\u201cBanque Priv\u00e9e\u201d) to the Union Bancaire
Priv\u00e9e, UBP SA, the contribution of this subsidiary to the \"Private Banking\" segment (geographical segments) and \"Other\"
from \"Foreign business\" segment (business segments) is reflected as income from discontinued operations. Banque
Priv\u00e9e BCP (Suisse) S.A. ceased to be part of the BCP Group on 2 November 2021, the date on which the sale of this
subsidiary was completed. In this context, the capital gain arising from the sale of the operation and its adjustments
occurred in 2022 were also recorded as income from discontinued operations. It should also be noted that on 29
December 2021, BIM \u2013 Banco Internacional de Mo\u00e7ambique, S.A. also formalized the sale to Fidelidade of shares
representing 70% of the share capital and voting rights of Seguradora Internacional de Mo\u00e7ambique, S.A., with BIM
maintaining approximately 22% of its share capital. The contribution of this subsidiary to the net income of the Foreign
Business segment is also presented as income of discontinued or discontinued operations as at December 2021, as
required by IFRS 5. The presentation of assets and liabilities of Banque Priv\u00e9e BCP (Suisse) S.A. and Seguradora
Internacional de Mo\u00e7ambique, S.A. referring to previous periods remained unchanged when compared to the criteria
considered in the preparation of the consolidated financial statements previously disclosed.
The information in the financial statements of reportable segments is reconciled, at the level of the total revenue of
those same segments, with the revenue from the demonstration of the consolidated financial position of the reportable
entity for each date on which is lodged a statement of financial position.
As at 31 December 2022, the net contribution of the major business segments, for the income statement, is analysed as
follows:
(Thousands of euros)
2022
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
(1)
Total
Private
banking
Other
Consolidated
INCOME STATEMENT
Interest and similar income
554,723
1,658,474
2,213,197
296,748
12,665
214,625
2,737,235
Interest expense and similar charges
(8,160)
(460,653)
(468,813)
(33,597)
(3,135)
(81,918)
(587,463)
Net interest income
546,563
1,197,821
1,744,384
263,151
9,530
132,707
2,149,772
Commissions and other income
481,546
321,666
803,212
198,406
43,261
4,768
1,049,647
Commissions and other costs
(55,517)
(219,667)
(275,184)
(30,057)
(2,147)
(153,377)
(460,765)
Net commissions and other income (2)
426,029
101,999
528,028
168,349
41,114
(148,609)
588,882
Net gains arising from trading activity
(3)
20,220
(19,299)
921
387
2,106
46,546
49,960
Share of profit of associates under the
equity method
\u2014
925
925
\u2014
\u2014
67,797
68,722
Gains/(losses) arising from the sale of
subsidiaries and other assets
\u2014
3,501
3,501
7
(1)
6,660
10,167
Net operating revenue
992,812
1,284,947
2,277,759
431,894
52,749
105,101
2,867,503
Operating expenses
460,918
470,346
931,264
102,948
22,324
16,482
1,073,018
Results on modification (4)
\u2014
(309,865)
(309,865)
\u2014
\u2014
\u2014
(309,865)
Impairment for credit and financial
assets (5)
(65,993)
(82,395)
(148,388)
(181,937)
594
33,602
(296,129)
Other impairments and provisions (6)
(158)
(550,085)
(550,243)
\u2014
\u2014
(209,790)
(760,033)
Net income before income tax
465,743
(127,744)
337,999
147,009
31,019
(87,569)
428,458
Income tax
(144,633)
(96,742)
(241,375)
(45,814)
(9,690)
(7,441)
(304,320)
Net income after income tax
from continuing operations
321,110
(224,486)
96,624
101,195
21,329
(95,010)
124,138
Income arising from discontinued
operations
\u2014
3,772
3,772
\u2014
1,765
\u2014
5,537
Net income for the year
321,110
(220,714)
100,396
101,195
23,094
(95,010)
129,675
Non-controlling interests
\u2014
72,802
72,802
\u2014
\u2014
5,020
77,822
Net income for the year attributable
to Bank's Shareholders
321,110
(147,912)
173,198
101,195
23,094
(89,990)
207,497
from negotiations with customers holding mortgage loans in foreign currency, hitherto accounted for in other impairments and
provisions (the amounts referring to 2021, given their immateriality in this context, were not restated).
5) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
6) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2022, the net contribution of the major operational Segments, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2022
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
Total
Private
banking
Other
Consolidated
BALANCE SHEET
Cash and Loans and advances to
credit institutions
14,454,223
3,208,230
17,662,453
1,479,714
2,610,460
(14,553,732)
7,198,895
Loans and advances to customers (1)
25,609,019
16,983,242
42,592,261
11,885,264
344,077
1,376,082
56,197,684
Financial assets (2)
2,100,135
5,458,513
7,558,648
\u2014
\u2014
12,795,575
20,354,223
Other assets
92,077
942,640
1,034,717
13,794
2,823
5,058,405
6,109,739
Total Assets
42,255,454
26,592,625
68,848,079
13,378,772
2,957,360
4,676,330
89,860,541
Resources from\u00a0 credit institutions
(3)
458,034
158,808
616,842
1,799,496
\u2014
(947,978)
1,468,360
Resources from customers (4)
39,318,562
23,173,054
62,491,616
10,577,717
2,734,372
103,109
75,906,814
Debt securities issued (5)
1,217,830
52,066
1,269,896
1,953
133,094
1,418,150
2,823,093
Other financial liabilities (6)
\u2014
535,648
535,648
\u2014
\u2014
1,216,914
1,752,562
Other liabilities (7)
51,224
907,471
958,695
69,045
1,058
960,349
1,989,147
Total Liabilities
41,045,650
24,827,047
65,872,697
12,448,211
2,868,524
2,750,544
83,939,976
Total Equity
1,209,804
1,765,578
2,975,382
930,561
88,836
1,925,786
5,920,565
Total Liabilities and Equity
42,255,454
26,592,625
68,848,079
13,378,772
2,957,360
4,676,330
89,860,541
Number of employees
3,814
9,491
13,305
522
137
1,779
15,743
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value
through profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive
income, assets with repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer
deposits at fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt
securities and certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2021, the net contribution of the major business segments, for the income statement, is analysed as
follows:
(Thousands of euros)
2021
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Private
banking
Other
Consolidated
Retail in
Portugal
Foreign
business
(1)
Total
INCOME STATEMENT
Interest and similar income
452,648
845,017
1,297,665
265,752
8,615
137,092
1,709,124
Interest expense and similar charges
(4,683)
(90,848)
(95,531)
(6,317)
(1,117)
(17,558)
(120,523)
Net interest income
447,965
754,169
1,202,134
259,435
7,498
119,534
1,588,601
Commissions and other income
462,357
326,399
788,756
165,373
36,517
(4,042)
986,604
Commissions and other costs
(52,274)
(171,744)
(224,018)
(20,248)
(3,188)
(139,394)
(386,848)
Net commissions and other income (2)
410,083
154,655
564,738
145,125
33,329
(143,436)
599,756
Net gains arising from trading activity (3)
18,449
10,968
29,417
286
1,391
55,444
86,538
Share of profit of associates under the
equity method
\u2014
(1,380)
(1,380)
\u2014
\u2014
58,317
56,937
Gains/(losses) arising from the sale of
subsidiaries and other assets
\u2014
402
402
4
\u2014
2,164
2,570
Net operating revenue
876,497
918,814
1,795,311
404,850
42,218
92,023
2,334,402
Operating expenses
469,851
421,815
891,666
111,207
22,047
90,678
1,115,598
Impairment for credit and financial
assets (4)
(75,370)
(77,259)
(152,629)
(150,831)
3,005
(56,120)
(356,575)
Other impairments and provisions (5)
(69)
(545,123)
(545,192)
\u2014
\u2014
(159,300)
(704,492)
Net income before income tax
331,207
(125,383)
205,824
142,812
23,176
(214,075)
157,737
Income tax
(103,402)
(94,583)
(197,985)
(44,722)
(6,960)
46,041
(203,626)
Net income after income tax
from continuing operations
227,805
(219,966)
7,839
98,090
16,216
(168,034)
(45,889)
Income arising from discontinued
operations
\u2014
18,587
18,587
\u2014
52,294
\u2014
70,881
Net income for the year
227,805
(201,379)
26,426
98,090
68,510
(168,034)
24,992
Non-controlling interests\u00a0 (6)
\u2014
113,291
113,291
\u2014
\u2014
(201)
113,090
Net income for the year attributable
to Bank's Shareholders
227,805
(88,088)
139,717
98,090
68,510
(168,235)
138,082
1) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
2) Includes net fees and commissions income, other operating income/(loss), net gains from insurance activity and dividends from
equity instruments.
3) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge
accounting operations, results from derecognition of financial assets and financial liabilities measured at amortised cost and results
from derecognition of financial assets measured at fair value through other comprehensive income.
4) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
5) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
6) Includes the non-controlling interests of BIM Group related to Seguradora Internacional de Mo\u00e7ambique, S.A., entity classified as a
discontinued operation
As at 31 December 2021, the net contribution of the major operational Segments, for the balance sheet, is analysed as
follows:
(Thousands of euros)
2021
Commercial banking
Companies,
Corporate
and
Investment
banking in
Portugal
Retail in
Portugal
Foreign
business
Total
Private
banking
Other
Consolidated
BALANCE SHEET
Cash and Loans and advances to
credit institutions
12,164,325
1,563,577
13,727,902
1,589,469
2,779,056
(9,485,129)
8,611,298
Loans and advances to customers (1)
25,010,925
17,780,147
42,791,072
12,077,141
344,222
1,147,494
56,359,929
Financial assets (2)
1,222,529
5,089,223
6,311,752
\u2014
5,022
15,423,364
21,740,138
Other assets
69,403
928,378
997,781
7,933
1,741
5,185,992
6,193,447
Total Assets
38,467,182
25,361,325
63,828,507
13,674,543
3,130,041
12,271,721
92,904,812
Resources from\u00a0 credit institutions (3)
362,803
124,346
487,149
3,107,835
\u2014
5,301,090
8,896,074
Resources from customers (4)
35,416,593
21,847,825
57,264,418
9,287,187
2,555,177
453,445
69,560,227
Debt securities issued (5)
1,396,658
8,632
1,405,290
1,418
165,410
2,198,023
3,770,141
Other financial liabilities (6)
\u2014
501,480
501,480
\u2014
\u2014
1,501,747
2,003,227
Other liabilities (7)
46,338
693,806
740,144
61,480
1,041
810,421
1,613,086
Total Liabilities
37,222,392
23,176,089
60,398,481
12,457,920
2,721,628
10,264,726
85,842,755
Total Equity
1,244,790
2,185,236
3,430,026
1,216,623
408,413
2,006,995
7,062,057
Total Liabilities and Equity
38,467,182
25,361,325
63,828,507
13,674,543
3,130,041
12,271,721
92,904,812
Number of employees
3,897
9,575
13,472
541
144
1,711
15,868
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations
net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value
through profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive
income, assets with repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer
deposits at fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt
securities and certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2022, the net contribution of the major geographic segments, for the income statement, is analysed
as follows:
(Thousands of euros)
2022
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
INCOME STATEMENT
Interest and similar income
554,723
296,748
11,693
214,625
1,077,789
1,363,784
294,690
972
2,737,235
Interest expense and similar
charges
(8,160)
(33,597)
(3,135)
(81,918)
(126,810)
(368,219)
(92,434)
\u2014
(587,463)
Net interest income
546,563
263,151
8,558
132,707
950,979
995,565
202,256
972
2,149,772
Commissions and other
income
481,546
198,406
43,229
4,768
727,949
271,358
50,308
32
1,049,647
Commissions and other costs
(55,517)
(30,057)
(2,107)
(153,377)
(241,058)
(209,600)
(10,067)
(40)
(460,765)
Net commissions and other
income (2)
426,029
168,349
41,122
(148,609)
486,891
61,758
40,241
(8)
588,882
Net gains arising from trading
activity (3)
20,220
387
2,085
46,546
69,238
(40,129)
20,830
21
49,960
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
67,797
67,797
\u2014
1,842
(917)
68,722
Gains/(losses) on disposal of
subsidiaries and other assets
\u2014
7
\u2014
6,660
6,667
2,596
904
\u2014
10,167
Net operating revenue
992,812
431,894
51,765
105,101
1,581,572
1,019,790
266,073
68
2,867,503
Operating expenses
460,918
102,948
21,401
16,482
601,749
357,092
113,255
922
1,073,018
Results on modification (4)
\u2014
\u2014
\u2014
\u2014
\u2014
(309,865)
\u2014
\u2014
(309,865)
Impairment for credit and
financial assets (5)
(65,993)
(181,937)
594
33,602
(213,734)
(74,068)
(8,327)
\u2014
(296,129)
Other impairments and
provisions (6)
(158)
\u2014
\u2014
(209,790)
(209,948)
(537,143)
(6,507)
(6,435)
(760,033)
Net income before income
tax
465,743
147,009
30,958
(87,569)
556,141
(258,378)
137,984
(7,289)
428,458
Income tax
(144,633)
(45,814)
(9,690)
(7,441)
(207,578)
(60,614)
(36,128)
\u2014
(304,320)
Net income after income tax
from continuing operations
321,110
101,195
21,268
(95,010)
348,563
(318,992)
101,856
(7,289)
124,138
Income arising from
discontinued operations
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
3,772
1,765
5,537
Net income for the year
321,110
101,195
21,268
(95,010)
348,563
(318,992)
105,628
(5,524)
129,675
Non-controlling interests
\u2014
\u2014
\u2014
5,020
5,020
108,125
(35,323)
\u2014
77,822
Net income for the year
attributable to Bank's
Shareholders
321,110
101,195
21,268
(89,990)
353,583
(210,867)
70,305
(5,524)
207,497
from negotiations with customers holding mortgage loans in foreign currency, hitherto accounted for in other impairments and
provisions (the amounts referring to 2021, given their immateriality in this context, were not restated).
5) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net
of recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial
assets at amortised cost not associated with credit operations.
6) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
As at 31 December 2022, the net contribution of the major geographic segments, for the balance sheet is analysed as
follows:
(Thousands of euros)
2022
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
14,454,223
1,479,714
2,610,460
(14,553,732)
3,990,665
2,193,520
1,014,710
\u2014
7,198,895
Loans and advances to
customers (1)
25,609,019
11,885,264
344,077
1,376,082
39,214,442
16,355,525
627,717
\u2014
56,197,684
Financial assets (2)
2,100,135
\u2014
\u2014
12,795,575
14,895,710
4,506,830
951,716
(33)
20,354,223
Other assets
92,077
13,794
2,823
5,058,405
5,167,099
641,572
230,266
70,802
6,109,739
Total Assets
42,255,454
13,378,772
2,957,360
4,676,330
63,267,916
23,697,447
2,824,409
70,769
89,860,541
Resources from other
credit institutions (3)
458,034
1,799,496
\u2014
(947,978)
1,309,552
155,411
3,397
\u2014
1,468,360
Resources from
customers (4)
39,318,562
10,577,717
2,734,372
103,109
52,733,760
20,941,241
2,231,813
\u2014
75,906,814
Debt securities issued (5)
1,217,830
1,953
133,094
1,418,150
2,771,027
52,066
\u2014
\u2014
2,823,093
Other financial liabilities
(6)
\u2014
\u2014
\u2014
1,216,914
1,216,914
535,648
\u2014
\u2014
1,752,562
Other liabilities (7)
51,224
69,045
1,058
960,349
1,081,676
839,464
68,007
\u2014
1,989,147
Total Liabilities
41,045,650
12,448,211
2,868,524
2,750,544
59,112,929
22,523,830
2,303,217
\u2014
83,939,976
Total Equity
1,209,804
930,561
88,836
1,925,786
4,154,987
1,173,617
521,192
70,769
5,920,565
Total Liabilities and
Equity
42,255,454
13,378,772
2,957,360
4,676,330
63,267,916
23,697,447
2,824,409
70,769
89,860,541
Number of employees
3,814
522
137
1,779
6,252
6,987
2,504
0
15,743
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations net of
impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through
profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income , assets with
repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer deposits at
fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
As at 31 December 2021, the net contribution of the major geographic segments, for the\u00a0 income statement, is
analysed as follows:
(Thousands of euros)
2021
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
INCOME STATEMENT
Interest and similar income
452,648
265,752
5,521
137,092
861,013
622,950
222,067
3,094
1,709,124
Interest expense and similar
charges
(4,683)
(6,317)
(1,117)
(17,558)
(29,675)
(28,264)
(62,585)
1
(120,523)
Net interest income
447,965
259,435
4,404
119,534
831,338
594,686
159,482
3,095
1,588,601
Commissions and other income
462,357
165,373
36,483
(4,042)
660,171
285,350
41,049
34
986,604
Commissions and other costs
(52,274)
(20,248)
(2,064)
(139,394)
(213,980)
(164,680)
(7,064)
(1,124)
(386,848)
Net commissions and other
income (2)
410,083
145,125
34,419
(143,436)
446,191
120,670
33,985
(1,090)
599,756
Net gains arising from trading
activity (3)
18,449
286
1,388
55,444
75,567
(5,978)
16,947
2
86,538
Share of profit of associates
under the equity method
\u2014
\u2014
\u2014
58,317
58,317
\u2014
\u2014
(1,380)
56,937
Gains/(losses) on disposal of
subsidiaries and other assets
\u2014
4
\u2014
2,164
2,168
398
4
\u2014
2,570
Net operating revenue
876,497
404,850
40,211
92,023
1,413,581
709,776
210,418
627
2,334,402
Operating expenses
469,851
111,207
21,123
90,678
692,859
330,231
91,584
924
1,115,598
Impairment for credit and
financial assets (4)
(75,370)
(150,831)
3,005
(56,120)
(279,316)
(71,365)
(5,894)
\u2014
(356,575)
Other impairments and
provisions (5)
(69)
\u2014
\u2014
(159,300)
(159,369)
(527,573)
(8,050)
(9,500)
(704,492)
Net income before income tax
331,207
142,812
22,093
(214,075)
282,037
(219,393)
104,890
(9,797)
157,737
Income tax
(103,402)
(44,722)
(6,960)
46,041
(109,043)
(72,534)
(22,049)
\u2014
(203,626)
Net income after income tax
from continuing operations
227,805
98,090
15,133
(168,034)
172,994
(291,927)
82,841
(9,797)
(45,889)
Income arising from
discontinued operations
\u2014
\u2014
\u2014
\u2014
\u2014
\u2014
18,587
52,294
70,881
Net income for the year
227,805
98,090
15,133
(168,034)
172,994
(291,927)
101,428
42,497
24,992
Non-controlling interests\u00a0 (6)
\u2014
\u2014
\u2014
(201)
(201)
145,672
(32,380)
(1)
113,090
Net income for the year
attributable to Bank's
Shareholders
227,805
98,090
15,133
(168,235)
172,793
(146,255)
69,048
42,496
138,082
1) Includes the contribution associated with the\u00a0 investments held in Angola, in Banco Millennium Atl\u00e2ntico.
2) Includes net fees and commissions income, other operating income/(loss), net gains from insurance activity and dividends from equity
instruments.
3) Includes results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting
operations, results from derecognition of financial assets and financial liabilities measured at amortised cost and results from derecognition of
financial assets measured at fair value through other comprehensive income.
4) Includes impairment of financial assets at amortised cost, for loans and advances of credit institutions, for loans to customers (net of
recoveries - principal and accrual) and for debt instruments related to credit operations. It also includes impairment of financial assets at
amortised cost not associated with credit operations.
5) Includes impairment of non-current assets held for sale, investments in associated companies, goodwill, other assets and provisions,
highlighting the provisions for legal proceedings related to mortgage loans granted in Swiss francs, booked by the Polish subsidiary.
6) Includes the non-controlling interests of BIM Group related to Seguradora Internacional de Mo\u00e7ambique, S.A., entity classified as a
discontinued operation.
As at 31 December 2021, the net contribution of the major geographic segments, for the balance sheet is analysed as
follows:
(Thousands of euros)
2021
Portugal
Retail
banking
Companies,
Corporate
and
Investment
banking
Private
banking
Other
Total
Poland
Mozambique
Other (1)
Consolidated
BALANCE SHEET
Cash and Loans and
advances to credit
institutions
12,164,325
1,589,469
2,456,868
(9,485,129)
6,725,533
861,770
701,807
322,188
8,611,298
Loans and advances to
customers (1)
25,010,925
12,077,141
344,222
1,147,494
38,579,782
17,206,345
573,802
\u2014
56,359,929
Financial assets (2)
1,222,529
\u2014
\u2014
15,423,364
16,645,893
4,033,150
1,056,108
4,987
21,740,138
Other assets
69,403
7,933
1,660
5,185,992
5,264,988
672,901
194,990
60,568
6,193,447
Total Assets
38,467,182
13,674,543
2,802,750
12,271,721
67,216,196
22,774,166
2,526,707
387,743
92,904,812
Resources from other
credit institutions (3)
362,803
3,107,835
\u2014
5,301,090
8,771,728
117,674
6,672
\u2014
8,896,074
Resources from
customers (4)
35,416,593
9,287,187
2,555,177
453,445
47,712,402
19,953,653
1,894,172
\u2014
69,560,227
Debt securities issued (5)
1,396,658
1,418
165,410
2,198,023
3,761,509
8,632
\u2014
\u2014
3,770,141
Other financial
liabilities (6)
\u2014
\u2014
\u2014
1,501,747
1,501,747
501,480
\u2014
\u2014
2,003,227
Other liabilities (7)
46,338
61,480
1,021
810,421
919,260
626,847
66,959
20
1,613,086
Total Liabilities
37,222,392
12,457,920
2,721,608
10,264,726
62,666,646
21,208,286
1,967,803
20
85,842,755
Total Equity
1,244,790
1,216,623
81,142
2,006,995
4,549,550
1,565,880
558,904
387,723
7,062,057
Total Liabilities and
Equity
38,467,182
13,674,543
2,802,750
12,271,721
67,216,196
22,774,166
2,526,707
387,743
92,904,812
Number of employees
3,897
541
140
1,711
6,289
7,079
2,496
4
15,868
1) Includes loans to customers at amortised cost net of impairment, debt instruments at amortised cost associated to credit operations net of
impairment and balance sheet amount of loans to customers at fair value through profit or loss.
2) Includes debt instruments at amortised cost not associated with credit operations (net of impairment), financial assets at fair value through
profit or loss (excluding the ones related to loans to customers), financial assets at fair value through other comprehensive income , assets with
repurchase agreement and hedging derivatives.
3) Includes resources and other financing from central banks and resources from other credit institutions.
4) Corresponds to deposits and other resources from customers (including resources from customers at amortised cost and customer deposits at
fair value through profit or loss).
5) Includes non-subordinated debt securities at amortized cost and financial liabilities at fair value through profit or loss (debt securities and
certificates).
6) Includes financial liabilities held for trading, subordinated debt and hedging derivatives.
7) Includes provisions, current and deferred tax liabilities and other liabilities.
Reconciliation of net income of reportable segments with the net income attributable to
shareholders
(Thousands of euros)
2022
2021
Net contribution
Retail banking in Portugal
321,110
227,805
Companies, Corporate and Investment banking
101,195
98,090
Private Banking
21,268
15,133
Foreign business (continuing operations)
(224,425)
(218,883)
Non-controlling interests (1)
72,802
113,291
291,950
235,436
Income arising from discontinued or discontinuing operations
5,537
70,881
297,487
306,317
Amounts not allocated to segments
Net interest income of the bond portfolio
48,729
29,504
Net interest income - TLTRO
41,555
81,266
Foreign exchange activity
36,209
28,539
Gains / (losses) arising from sales of subsidiaries and other assets
6,660
2,164
Equity accounted earnings
67,797
58,317
Impairment and other provisions (2)
(176,188)
(215,421)
Operational costs (3)
(16,482)
(90,678)
Gains on sale of Portuguese public debt
(24,336)
39,430
Gains on sale of foreign public debt
15,700
19,786
Mandatory contributions
(88,528)
(77,222)
Loans sale
8,291
(3,407)
Income from other financial assets not held for trading mandatorily
at fair value through profit or loss (4)
3,474
(33,774)
Taxes (5)
(7,441)
46,040
Non-controlling interests
5,020
(201)
Others (6)
(10,450)
(52,578)
Total not allocated to segments
(89,990)
(168,235)
Consolidated net income
207,497
138,082
The presented amounts include the accumulated net income.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators defined by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also defined.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is based
on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are calculated on a
daily basis, taking into account the impact in the liquidity buffers available to discount with the respective central
banks at the reference date of future estimated cash flows for each of the respective time horizon (3 days or 3 months)
considering the set of transactions intermediated by the market areas, including in this context transactions with
clients of the Corporate and Private networks, which, due to their size, must be quoted by the Trading Room. The
remaining buffer in each time bucket is then compared to the amount of customer deposits, being the indicators
assessed against exposure limits defined in the Bank's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis identifying all the
factors that justify the variations that occur. This analysis is submitted to the Capital and Assets and Liabilities
Committee (CALCO) for appraisal, to enable the decision making that leads to the maintenance of financing conditions
adequate to the continuation of the business.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterize the Bank's risk profile and to ensure that the Group and
each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support the
liquidity contingency plan and management decisions.
In 2022, the liquidity positions of BCP, Bank Millennium and BIM reinforced their robustness, based mainly on the
growth of the respective customer deposit bases. This growth was particularly significant in the operation in Portugal,
in which it reached approximately 10%, mainly through the contribution of the retail depositors\u2019 segment. The main
source of financing for the operation in Portugal thus saw its stability reinforced, supporting, as in previous years, a
favourable evolution of the commercial gap.
Accordingly, the regulatory Liquidity Coverage Ratio (LCR), an indicator of short-term liquidity risk, stood at 212% on a
consolidated basis at the end of December 2022 (31 December 2021: 269%), well above the minimum regulatory
requirement of 100%, supported by portfolios of highly liquid assets whose value is compatible with a prudent liquidity
management by the Group.
The regulatory Net Stable Funding Ratio (NSFR), an indicator of structural liquidity risk, increased from 150% on 31
December 2021 to 154% on 31 December 2022, also above the regulatory minimum of 100%, mainly based on the growth
of the customer deposit portfolio.
The loan-to-deposit transformation ratio, another structural indicator of the RAS (calculated in accordance with Bank of
Portugal Instruction no 16/2004, in force), also evolved favourably from a liquidity risk perspective, from 81% on 31
December 2022 to 74% one year later.
It should be noted that, in the annual risk review for 2023, the internal limits for the RAS indicators remained
unchanged facing 2022.
Regarding the presence of the Bank in the debt segment of the capital market, it is worth highlighting the following
events, in chronological order: (i) in May, BCP repaid a covered bond issue in the amount of Euros 1,000,000,000. Given
the Bank's surplus position in terms of liquidity, there was no need to refinance the amount repaid in the market; (ii) in
October, the Bank placed its third issue of senior preferred debt on the market in a 3NC2 format (3 years maturity
callable after 2 years) in the amount of Euros 350,000,000. The operation was aimed at ensuring compliance with the
requirements of \u201cMREL\u201d (Minimum Requirements for Own Funds and Eligible Liabilities), namely the indicative target
that will be in force during 2023, from 1 January. This issue, with a coupon of 8.50% per annum (corresponding to a
spread of 554.7bps over mid-swaps) was carried out in very difficult market conditions, demonstrating the Bank's ability
to access the market even in an adverse and very complex environment; and (iii) in November, and considering that in
view of the prevailing market conditions the Bank had decided not to exercise, in December, the early repayment
option on a T2 issue of\u00a0 Euros 300,000,000, BCP launched an offer to exchange these securities not reimbursed, in the
ratio of 1:1, by others of the same nature, to be issued. Thus, given the non-exercise of the call-option, investors were
offered the option to exchange the bonds they held for newly issued securities with a higher coupon and longer term.
The amount of the new issue 10.25NC5.25 of T2 was set at Euros 133,700,000 and the coupon at 8.75%, per annum,
corresponding to a spread of 605.1bps over mid-swaps.
Still with regard to the funding structure, BCP repaid in advance in December 2022 the first tranche of the Targeted
longer term refinancing operation III (\u201cT LTRO III\u201d), contracted in June 2020 in the amount of Euros 7,550,070,000 (with
the second tranche, amounting to Euros 600,000,000, already repaid in January 2023). Considering the balance in
deposit at the Bank of Portugal and other available liquidity, BCP ended 2022 with a long position on the Eurosystem of
Euros 2,574,146,000.
Throughout 2022, the behaviour of the liquidity buffer at the ECB was mainly determined by the impacts, in opposite
directions, of the aforementioned favourable evolution of the commercial gap, on the one hand and, on the other
hand, of the growth of the margin calls related to derivatives and the decrease of the market price of the assets
eligible for discount with the Eurosystem, effects that showed a growing trend after the outbreak of war in Ukraine.
The combined effect of these and other factors of lesser materiality allowed, nevertheless, the buffer to grow Euros
2,749,283,000 on an annual basis, to Euros 26,520,745,000.
Likewise, in the year ended December 2022, Bank Millennium and BIM demonstrated the resilience of their liquidity
positions, supported by their retail deposit bases and robust buffers discountable at the respective central banks, with
regulatory and internal indicators of liquidity risk positioned comfortably above the comfort thresholds. In the case of
the operation in Poland, this occurred even considering the effects of the invasion of Ukraine, which resulted in the
significant devaluation of the eligible asset portfolio and the strengthening of derivatives\u2019 margin accounts.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after haircuts,
is detailed as follows:
(Thousands of euros)
2022
2021
European Central Bank
13,677,518
13,394,653
Other Central Banks
5,213,823
4,840,405
18,891,341
18,235,058
with possible situations of financial stress. The measures for its reinforcement are described in the Recovery Plan
which, at 31 December 2022, had a total estimated value for Portugal of Euros 3,750,000,000, arising from the sale of
corporate bonds and commercial paper, securitization of a portfolio of consumer credit and issuance of retained
covered bonds to be mobilized for the ECB's monetary policy pool.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels over the
next three years, with annual refinancing needs with no material expression.
", "dimensions": { "concept": "ifrs-full:DisclosureOfObjectivesPoliciesAndProcessesForManagingCapitalExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-701": { "value": "Solvency
The Group\u2019s own funds are determined according to the established regulation, in particular, according to Directive
2013/36/EU and Regulation (EU) 575/2013, approved by the European Parliament and the Council (CRD IV/CRR).
Total capital includes tier 1 and tier 2. Tier 1 comprises common equity tier 1 (CET1) and additional tier 1.
Common equity tier 1 includes: (i) paid-up capital, share premium, reserves and retained earnings deducted
anticipated dividends and non-controlling interests; ii) and deductions related to own shares and loans to finance the
acquisition of shares of the Bank, the shortfall of value adjustments and provisions to expected losses concerning risk\u2010
weighted exposure amounts calculated according to the IRB approach, goodwill and other intangible assets and the
additional value adjustments necessary for the prudent valuation requirements applied to all assets at fair value,
adjustments related to minimum commitment with collective investments undertakings, insufficient coverage for non-
performing exposures and with the amount of securitisation positions, eligible for deduction as an alternative to a 1 250
% risk weight. Reserves and retained earnings are adjusted by the reversal of unrealised gains and losses on cash-flow
hedge transactions and on financial liabilities valued at fair value through profits and losses, to the extent related to
own credit risk. The non-controlling interests are only eligible up to the amount of the Group\u2019s capital requirements
attributable to the minorities. In addition, the deferred tax assets arising from unused tax losses carried forward are
deducted, as well as the deferred tax assets arising from temporary differences relying on the future profitability and
the interests held in financial institutions and insurers of at least 10%, in this case only in the amount that exceeds the
thresholds of 10% and 15% of the common equity tier 1, when analysed on an individual and aggregated basis,
respectively. The irrevocable payment commitments for the Single Resolution Fund, the fair value of the collateral for
irrevocable commitments from the Deposits Guarantee Fund and the additional coverage for non-performing exposures,
are also deducted, due to a SREP (Supervisory Review and Evaluation Process) recommendation.
Additional tier 1 comprises preference shares, hybrid instruments and perpetual bonds representing subordinated debt
that are compliant with the issue conditions established in the Regulation and non-controlling interests related to
minimum level 1 additional capital requirements, of institutions that are not totally owned by the Group.
Tier 2 includes the subordinated debt that is compliant with the Regulation and the non-controlling interests related to
minimum total capital requirements of institutions that are not totally owned by the Group. Additionally, Tier 2
instruments held in financial institutions and insurers of at least 10% are deducted.
The legislation in force stipulates a transitional period between the own funds calculated under national law until 31
December 2013, and own funds estimated according to EU law, in order to exclude some elements previously
considered (phase-out) and include new elements (phase-in). The transitional period was extended to the end of 2017
for most of the elements, except for the deferred tax assets already recorded on the balance sheet of 1 January 2014,
according to the new regulation, which period ends in 2023.
With the IFRS9 introduction the Group has decided to gradually recognise the impacts, according to art\u00ba 473\u00ba-A of CRR.
The group also decided to adopt, until the end of 2022, the option to gradually recognise the change in unrealized gains
and losses measured at fair value through other comprehensive income, according to art\u00ba 468 of the CRR.
CRD IV/CRR\u00a0 establishes Pilar 1 capital requirements for CET1, Tier 1 and Total Capital. However, under the scope of
SREP , European Central Bank notified BCP about the need to comply with phased-in capital ratios, including additional
Pilar 2 requirements,\u00a0 O-SII and capital conservation buffer, as following:
2022 Minimum Capital Requirements
BCP Consolidated
Phased-in
of which:
Fully
implemented
of which:
Pilar 1
Pilar 2
Buffers
Pilar 1
Pilar 2
Buffers
CET1
9.16%
4.50%
1.41%
3.25%
9.41%
4.50%
1.41%
3.50%
T1
11.13%
6.00%
1.88%
3.25%
11.38%
6.00%
1.88%
3.50%
Total
13.75%
8.00%
2.50%
3.25%
14.00%
8.00%
2.50%
3.50%
The presented amounts include the accumulated net income.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators defined by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also defined.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is based
on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are calculated on a
daily basis, taking into account the impact in the liquidity buffers available to discount with the respective central
banks at the reference date of future estimated cash flows for each of the respective time horizon (3 days or 3 months)
considering the set of transactions intermediated by the market areas, including in this context transactions with
clients of the Corporate and Private networks, which, due to their size, must be quoted by the Trading Room. The
remaining buffer in each time bucket is then compared to the amount of customer deposits, being the indicators
assessed against exposure limits defined in the Bank's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis identifying all the
factors that justify the variations that occur. This analysis is submitted to the Capital and Assets and Liabilities
Committee (CALCO) for appraisal, to enable the decision making that leads to the maintenance of financing conditions
adequate to the continuation of the business.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterize the Bank's risk profile and to ensure that the Group and
each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support the
liquidity contingency plan and management decisions.
In 2022, the liquidity positions of BCP, Bank Millennium and BIM reinforced their robustness, based mainly on the
growth of the respective customer deposit bases. This growth was particularly significant in the operation in Portugal,
in which it reached approximately 10%, mainly through the contribution of the retail depositors\u2019 segment. The main
source of financing for the operation in Portugal thus saw its stability reinforced, supporting, as in previous years, a
favourable evolution of the commercial gap.
Accordingly, the regulatory Liquidity Coverage Ratio (LCR), an indicator of short-term liquidity risk, stood at 212% on a
consolidated basis at the end of December 2022 (31 December 2021: 269%), well above the minimum regulatory
requirement of 100%, supported by portfolios of highly liquid assets whose value is compatible with a prudent liquidity
management by the Group.
The regulatory Net Stable Funding Ratio (NSFR), an indicator of structural liquidity risk, increased from 150% on 31
December 2021 to 154% on 31 December 2022, also above the regulatory minimum of 100%, mainly based on the growth
of the customer deposit portfolio.
The loan-to-deposit transformation ratio, another structural indicator of the RAS (calculated in accordance with Bank of
Portugal Instruction no 16/2004, in force), also evolved favourably from a liquidity risk perspective, from 81% on 31
December 2022 to 74% one year later.
It should be noted that, in the annual risk review for 2023, the internal limits for the RAS indicators remained
unchanged facing 2022.
Regarding the presence of the Bank in the debt segment of the capital market, it is worth highlighting the following
events, in chronological order: (i) in May, BCP repaid a covered bond issue in the amount of Euros 1,000,000,000. Given
the Bank's surplus position in terms of liquidity, there was no need to refinance the amount repaid in the market; (ii) in
October, the Bank placed its third issue of senior preferred debt on the market in a 3NC2 format (3 years maturity
callable after 2 years) in the amount of Euros 350,000,000. The operation was aimed at ensuring compliance with the
requirements of \u201cMREL\u201d (Minimum Requirements for Own Funds and Eligible Liabilities), namely the indicative target
that will be in force during 2023, from 1 January. This issue, with a coupon of 8.50% per annum (corresponding to a
spread of 554.7bps over mid-swaps) was carried out in very difficult market conditions, demonstrating the Bank's ability
to access the market even in an adverse and very complex environment; and (iii) in November, and considering that in
view of the prevailing market conditions the Bank had decided not to exercise, in December, the early repayment
option on a T2 issue of\u00a0 Euros 300,000,000, BCP launched an offer to exchange these securities not reimbursed, in the
ratio of 1:1, by others of the same nature, to be issued. Thus, given the non-exercise of the call-option, investors were
offered the option to exchange the bonds they held for newly issued securities with a higher coupon and longer term.
The amount of the new issue 10.25NC5.25 of T2 was set at Euros 133,700,000 and the coupon at 8.75%, per annum,
corresponding to a spread of 605.1bps over mid-swaps.
Still with regard to the funding structure, BCP repaid in advance in December 2022 the first tranche of the Targeted
longer term refinancing operation III (\u201cT LTRO III\u201d), contracted in June 2020 in the amount of Euros 7,550,070,000 (with
the second tranche, amounting to Euros 600,000,000, already repaid in January 2023). Considering the balance in
deposit at the Bank of Portugal and other available liquidity, BCP ended 2022 with a long position on the Eurosystem of
Euros 2,574,146,000.
Throughout 2022, the behaviour of the liquidity buffer at the ECB was mainly determined by the impacts, in opposite
directions, of the aforementioned favourable evolution of the commercial gap, on the one hand and, on the other
hand, of the growth of the margin calls related to derivatives and the decrease of the market price of the assets
eligible for discount with the Eurosystem, effects that showed a growing trend after the outbreak of war in Ukraine.
The combined effect of these and other factors of lesser materiality allowed, nevertheless, the buffer to grow Euros
2,749,283,000 on an annual basis, to Euros 26,520,745,000.
Likewise, in the year ended December 2022, Bank Millennium and BIM demonstrated the resilience of their liquidity
positions, supported by their retail deposit bases and robust buffers discountable at the respective central banks, with
regulatory and internal indicators of liquidity risk positioned comfortably above the comfort thresholds. In the case of
the operation in Poland, this occurred even considering the effects of the invasion of Ukraine, which resulted in the
significant devaluation of the eligible asset portfolio and the strengthening of derivatives\u2019 margin accounts.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after haircuts,
is detailed as follows:
(Thousands of euros)
2022
2021
European Central Bank
13,677,518
13,394,653
Other Central Banks
5,213,823
4,840,405
18,891,341
18,235,058
with possible situations of financial stress. The measures for its reinforcement are described in the Recovery Plan
which, at 31 December 2022, had a total estimated value for Portugal of Euros 3,750,000,000, arising from the sale of
corporate bonds and commercial paper, securitization of a portfolio of consumer credit and issuance of retained
covered bonds to be mobilized for the ECB's monetary policy pool.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels over the
next three years, with annual refinancing needs with no material expression.
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk Committee, the
following information is presented in accordance with Commission Implementing Regulation (EU) 2021/637 of 15 March
2021 supplementing Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to
regulatory technical standards for disclosure of encumbered and unencumbered assets.
(Thousands of euros)
2022 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the disclosing
institution
13,756,969
1,091,650
82,775,892
25,254,479
Equity instruments
\u2014
\u2014
\u2014
\u2014
127,810
\u2014
127,810
\u2014
Debt securities
1,091,650
1,091,650
968,647
968,647
20,604,616
15,841,854
20,024,958
15,227,018
of which: securitisations
\u2014
\u2014
\u2014
\u2014
29,291
\u2014
24,793
\u2014
of which: issued by
general governments
1,052,101
1,052,101
930,126
930,126
15,452,215
14,962,526
14,877,737
14,391,677
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
1,804,297
119,941
1,804,289
119,941
of which: issued by non-
financial corporations
39,560
39,560
38,521
38,521
2,754,650
541,928
2,754,901
541,928
Other assets
12,793,413
\u2014
61,561,554
8,879,947
(1)Table's figures are calculated by the median of the values disclosed in the regulatory information for the previous 4 quarters.
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2022 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing institution
\u2014
\u2014
88,857
1,502
Debt securities
\u2014
\u2014
1,502
1,502
of which: issued by general governments
\u2014
\u2014
1,502
1,502
Loans and advances other than loans on demand
\u2014
\u2014
87,393
\u2014
Own covered bonds and securitisations issued
and not yet pledged
6,113,493
\u2014
TOTAL COLLATERAL RECEIVED AND OWN DEBT
SECURITIES ISSUED
13,756,969
1,091,650
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered
bonds and securitisations encumbered
Carrying amount of selected financial liabilities
10,520,000
13,256,892
At the end of 2022, and according to the EBA methodology, the total encumbered assets represents 14% of the Group's
total balance sheet assets. The encumbered Loans to customers represents 81% of the total encumbered assets, while
Debt securities represents 8%.
The encumbered assets are mostly related with the Portugal's activity funding operations, namely with the ECB,
securitisation programs and derivatives operations. The type of assets used as collateral for these financing transactions
are different Loans to Customers\u2019 portfolios, supporting securitisation programs and mortgage bonds, intended to
reinforce the collateral pool with the ECB. Regarding the collateralization of derivative operations, as well as financing
operations with the European Investment Bank, is mainly supported by sovereign debt eligible for central banks,
together with bonds issued by public sector companies.
On 31 December 2022, the Other assets includes unencumbered assets in the amount of Euros 8,477,357,000 related to
Loans on demand, the amount of Euros 56,201,560,000 related to Loans and advances other than loans on demand (of
which encumbered assets in the amount of Euros 11,188,611,000) and the amount of Euros 8,601,987,000, mostly
unencumbered and related to the Group\u2019s activity, namely, to: investments in associated companies and subsidiaries,
tangible assets and investment properties, intangible assets, assets associated with derivatives and current and
deferred taxes.
A 31 December 2022, the Group has a Euros 12.5 billion BCP Covered Bond Programme (\u201cBCP Programme\u201d) with Euros
9.2 billion of covered bonds outstanding. The BCP Programme is backed by a Euros 10.6 billion portfolio of residential
mortgages, providing an overcollateralization (\u201cOC\u201d) of 15.4%, which is above the minimum of 14% currently required
by rating agencies.
The Portuguese covered bond legislation affords covered bond holders a dual-recourse, firstly over the issuer, secondly
over the cover pool that may also include other eligible assets, over which they benefit from a special preferential
claim. The Portuguese covered bond legislation ensures total segregation of the covered pool from any future issuer\u2019s
insolvent estate, for the benefit of covered bond holders, who have precedence over claims of any other of the issuer\u2019s
creditors in case of issuer insolvency, thus and to this extent superseding the general insolvency and recovery
legislation. Residential mortgages in a cover pool are subject to certain eligibility criteria inscribed in the Portuguese
covered bond legislation, among them a maximum LTV of 80%, delinquency of no more than 90 days, and them being
first lien mortgages (or, if otherwise, all preceding liens being in the cover pool) over properties located in the EU. The
BCP\u2019s Programme documentation limits property location to Portugal only.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2022
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
At sight
Total
Assets
Cash and deposits at Central Banks
6,022,001
\u2014
\u2014
\u2014
\u2014
\u2014
6,022,001
Loans and advances to Credit
Institutions - Repayable on demand
213,460
\u2014
\u2014
\u2014
\u2014
\u2014
213,460
Other loans and advances (a)
\u2014
752,913
211,383
\u2014
\u2014
\u2014
964,296
Loans and advances to customers (a)
\u2014
\u2014
8,464,759
13,639,800
33,494,378
579,229
56,178,166
Other financial assets (b)
\u2014
777,004
1,371,845
5,090,680
1,049,378
491,922
8,780,829
6,235,461
1,529,917
10,047,987
18,730,480
34,543,756
1,071,151
72,158,752
Liabilities
Resources from Credit Institutions
\u2014
499,654
87,373
881,333
\u2014
\u2014
1,468,360
Resources from costumers
48,673,569
14,634,189
10,956,260
1,106,125
60,000
\u2014
75,430,143
Debt securities issued
\u2014
2,008
\u2014
852,706
627,372
\u2014
1,482,086
Subordinated debt
\u2014
\u2014
\u2014
314,519
1,018,537
\u2014
1,333,056
48,673,569
15,135,851
11,043,633
3,154,683
1,705,909
\u2014
79,713,645
(a)Gross of impairment
(b)Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
", "dimensions": { "concept": "ifrs-full:DisclosureOfLiquidityRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-702": { "value": "Risk Management
The Group is subject to several risks during the course of its business. The risks from different companies of the Group
are managed centrally, in coordination with the local departments and considering the specific risks of each business.
The Group's risk-management policy is designed to permanently ensure an adequate relationship between its own funds
and the business it develops, as well as the corresponding evaluation of the risk/return profile by business line. Under
this scope, the monitoring and control of the main types of financial risks (e.g. credit, market, operational) or non-
financial risks (e.g. legal and compliance, reputational) to which the Group's business is subject to.
The Bank implemented a regular process for identifying and assessing the risks to which its activity is exposed, which
conclusions are presented to the management bodies and influence the update of the Group\u2019s risk appetite and risk
strategy.
Internal organisation
Banco Comercial Portugu\u00eas Board of Directors is responsible for the definition of the risk strategy and policies,
including the approval of the principles and rules\u00a0 of the highest level to be followed in risk management, as well as the
guidelines dictating the allocation of capital to the business lines.
The Board of Directors, through the Audit Committee and Committee for Risk Assessment, ensures the existence of
adequate risk control and of risk-management systems at Group level and for each entity. The Board of Directors also
approves the risk-tolerance level acceptable to the Group, proposed by its Executive Committee.
The Risk Committee is responsible for monitoring the overall levels of risk incurred, ensuring that these are compatible
with the goals and strategies approved for the business. Other commissions regularly monitor specific risks, namely the
Compliance and Operational Risks Commission, the Credit and Non-performing Assets Monitoring Commission, the
Pension Funds Risk Monitoring Commission, the Operational Resilience Commission (with a focus on information
technologies and cybernetics), the Sustainability Commission and the Corporate Risk Monitoring Commission.
The Chief Risk Officer is responsible for the control of risks in all Group entities, for the identification of all risks to
which the Group activity is exposed and for the proposal of measures to improve risks control. The Chief Risk Officer
also ensures that risks are monitored on an overall basis and that there is alignment of concepts, practices and goals in
risk management. The activity of every entity included within the Banco Comercial Portugu\u00eas consolidation perimeter is
governed by the principles and decisions established centrally by the Board of Directors\u00a0 and the main subsidiaries are
provided with Risk Office structures which are established in accordance with the risks inherent to their particular
business. A Risk Control Commission has been set up at each relevant subsidiary, responsible for the control of risks at
local level, in which the Chief Risk Officer takes part.
The Group Head of Compliance is responsible for implementing systems for monitoring the compliance with legal
obligations and responsibilities to which the Bank is subject, as well, the prevention, monitoring and reporting of risks
in organizational processes, which include, among others, the prevention and repression of money laundering,
combating financing of terrorism, prevention of conflicts of interest, issues related to abuse of market and compliance
with the disclosure requirements to customers.
Risk assessment
Credit Risk
Credit granting is based on a prior classification of the customers\u2019 risk and on a thorough assessment of the level of
protection provided by the underlying collateral. In order to do so, a single risk-notation system has been introduced,
the Rating Master Scale, based on the expected probability of default, allowing greater discrimination in the
assessment of the customers and better establishment of the hierarchies of the associated risk.
The Rating Master Scale also identifies those customers that show a worsening credit capacity and, in particular, those
classified as being in default. All rating and scoring models used by the Group have been duly calibrated for the Rating
Master Scale. The protection-level concept has been introduced as a crucial element of evaluation of the effectiveness
of the collateral in credit-risk mitigation, leading to a more active collateralization of loans and to a better adequacy
of pricing regarding the risk incurred.
The gross Group\u2019s exposure to credit risk (original exposure) is presented in the following table:
(Thousands of euros)
Risk items
2022
2021
Central Governments or Central Banks
22,898,387
24,942,714
Regional Governments or Local Authorities
1,012,723
1,243,453
Administrative and non-profit Organisations
412,223
462,481
Multilateral Development Banks
114,633
18,790
Other Credit Institutions
3,279,977
2,777,375
Retail and Corporate customers
69,798,319
71,911,594
Other items (*)
10,153,154
8,562,386
107,669,416
109,918,793
Note: gross exposures of impairment and amortization, in accordance with the prudential consolidation perimeter. Includes
securitization positions.
(*) In addition to positions in equity, collective investment and securitization, the Other items contain other assets subject to credit
risk in accordance with Article 134 of the CRR.
The evaluation of the risk associated to the loan portfolio and quantification of the respective losses expected
considers the following methodological notes.
a) Collaterals and Guarantees
On the risk evaluation of an operation or of a group of operations, the mitigation elements of credit risk associated to
those operations are considered in accordance with the rules and internal procedures that fulfil the requirements
defined by the regulations in force, also reflecting the experience of the loan's recovery areas and the Legal
Department opinions with respect to the entailment of the various mitigation instruments.
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 7 or better on the Rating Master Scale;
- personal guarantees when the persons are classified with Risk Grade 7 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organized
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in restructuring
process associated to credit recoveries.
Regarding guarantees and credit derivatives, it can be applied the substitution principle by replacing the Risk Grade of
the client by the Risk Grade of the guarantor, (if the Risk of Grade Degree of the guarantor is better than the client\u2019s),
when the protection is formalized through:
- State, Financial Institutions or Mutual Guarantee Societies guarantees exist;
- personal guarantees (or, in the case of Leasing,\u00a0 there is a recovery agreement of the provider);
- Credit derivatives;
- Formalization of the clause of the contracting party in leasing contracts in which it is an entity that is in a relationship
of dominion or group with the lessee.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.
In the case of real estate mortgages, the initial appraisal of the real estate value is done during the credit analysis and
before decision process.
Either the initial evaluations or the subsequent reviews carried out are performed by external expert valuers and the
ratification process is centralized in the Appraisals Unit, which is independent of the clients\u2019 areas.
In any case, they are the subject to a written report, in a standardized digital format, based on a group of predefined
methods that are aligned with the sector practices \u2013 income, replacement cost and/or market comparative -
mentioning the obtained value, for both the market value and for purposes of the mortgage guarantee, depending on
the type of the real estate. The evaluations have a declaration/certification of an expert valuer since 2008, as
requested by Regulation (EU) 575/2013 and Law 153/2015 of 14 September and are ratified by the Appraisals Unit.
Regarding residential real estate, after the initial valuation and in accordance with Notice n. 5/2006 of Bank of
Portugal and e CRR 575/2013, the Bank monitors the respective values through market indexes. If the index is lower
than 0.9, the Bank\u00a0 revaluates choosing one of the following two methods:
i) - depreciation of the property by direct application of the index, if the amount owed does not exceed Euros 300,000;
ii) - review of the property value by external valuators, depending on the value of the credit operation, and in
accordance with the established standards from ECB and Bank of Portugal.
For all non-residential real estate, the Bank also monitors its values through market indexes and to the regular
valuation reviews with the minimum periodicities in accordance with the Regulation (EU) 575/2013, in the case of
offices, commercial spaces, warehouses and industrial premises.
For all real estate (residential or non-residential) for which the monitoring result in significant devaluation of the real
estate value (more than 10%), a valuation review is subsequently carried out by an expert valuer, preserving the
referred i) above.
For the remaining real estate (land or countryside buildings for example) there are no market indexes available for the
monitoring of appraisal values, after the initial valuations. Therefore, for these cases and in accordance with the
minimum periodicity established for the monitoring and reviewing of this type of real estate, valuation reviews are
carried out by expert valuers.
The indexes currently used are supplied to the Bank by an external specialized entity that, for more than a decade, has
been collecting and processing the data upon which the indexes are built.
In the case of financial collaterals, their market value is daily and automatically updated, through the IT connection
between the collaterals management system and the relevant financial markets data.
b) Risk grades
Credit granting is based on the previous risk assessment of clients and also on a rigorous assessment of the protection
level provided by the underlying collaterals. For this purpose, a single risk grading system is used - the Rating Master
Scale - based on Probability of Default (PD), allowing for a greater discriminating power in clients' assessment and for a
better hierarchy of the associated risk. The Rating Master Scale also allows to identify clients that show signs of
degradation in their credit capacity and, in particular, those that are classified in a default situation. All rating systems
and models used by the Group were calibrated for the Rating Master Scale.
Aiming at an adequate assessment of credit risk, the Group defined a set of macro segments and segments which are
treated through different rating systems and models that relate the internal risk grades and the clients\u2019 PD, ensuring a
risk assessment that considers the clients\u2019 specific features in terms of their respectively risk profiles.
The assessment made by these rating systems and models result in the risk grades of the Master Scale, that has fifteen
grades, where the last three correspond to relevant downgrades of the clients\u2019 credit quality and are referred to by
\u201cprocedural risk grades\u201d: 13, 14 and 15, that correspond, in this order, to situations of increased severity in terms
default, as risk grade 15 is a Default situation.
The non-procedural risk grades are attributed by the rating systems through automatic decision models or by the Rating
Division \u2013 a unit which is independent from the credit analysis and decision areas and bodies- and are reviewed/updated
periodically or whenever this is justified by events.
The models within the various rating systems are regularly subject to validation, made by the Models Validation and
Monitoring Office, which is independent from the units that are responsible for the development and maintenance of
the rating models.
The conclusions of the validations by the Models Validation and Monitoring Office, as well the respective
recommendations and proposal for changes and/or improvements, are analysed and ratified by a specific Validation
Committee, composed in accordance to the type of model analysed. The proposals for models\u2019 changes originated by
the Validation Committee are submitted to the approval of the Risk Committee.
The following table lists the equivalence between the internal rating levels (Rating Master Scale) and the external
ratings of the international rating agencies:
Internal risk grade
External ratings
Fitch
S&P
Moody's
DBRS
1
AAA
AAA
Aaa
AAA
1
AA+
AA+
Aa1
AA (high)
2
AA
AA
Aa2
AA
2
AA-
AA-
Aa3
AA (low)
3
A+
A+
A1
A (high)
3
A
A
A2
A
4
A-
A-
A3
A (low)
4
BBB+
BBB+
Baa1
BBB (high)
5
BBB
BBB
Baa2
BBB
6
BBB-
BBB-
Baa3
BBB (low)
7
BB+
BB+
Ba1
BB (high)
8
BB
BB
Ba2
BB
9
BB-
BB-
Ba3
BB (low)
10
B+
B+
B1
B (high)
11
B
B
B2
B
12
\u2264 B-
\u2264 B-
\u2264 B3
\u2264 B-
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
(Thousands of euros)
Category
2022
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
862
\u2014
\u2014
\u2014
862
Loans and advances to customers (note 22)
214,470
284,448
985,557
17,898
1,502,373
Debt instruments (note 23)
13,409
720
110
\u2014
14,239
Debt instruments at fair value through other
comprehensive income (note 24) (*)
\u2014
\u2014
1,067
\u2014
1,067
Guarantees and other commitments (note 39) (**)
11,307
14,893
84,435
119
110,754
Total
240,048
300,061
1,071,169
18,017
1,629,295
(Thousands of euros)
Category
2022
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
963,434
\u2014
\u2014
\u2014
963,434
Loans and advances to customers (note 22)
46,181,526
7,279,787
1,185,422
29,058
54,675,793
Debt instruments (note 23)
12,976,823
55,067
3,692
\u2014
13,035,582
Debt instruments at fair value through other
comprehensive income (note 24) (*)
7,434,152
\u2014
\u2014
\u2014
7,434,152
Guarantees and other commitments (note 45) (**)
14,291,924
1,753,702
280,256
802
16,326,684
Total
81,847,859
9,088,556
1,469,370
29,860
92,435,645
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
As at 31 December 2021, the financial instruments subject to impairment requirements under IFRS 9 (do not include
equity instruments as accounting policy 1.C1.1.2, analysed by stage, are detailed in the following tables:
(Thousands of euros)
Category
2021
Gross exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,287
5,113
\u2014
\u2014
454,400
Loans and advances to customers (note 22)
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Debt instruments (note 23)
8,094,290
122,257
4,451
\u2014
8,220,998
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
1,092
\u2014
12,857,257
Guarantees and other commitments (note 45) (**)
13,462,773
1,922,031
412,179
\u2014
15,796,983
Total
80,976,168
10,013,453
3,103,989
57,713
94,151,323
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1.C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments.
(Thousands of euros)
Category
2021
Impairment losses
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
128
1,059
\u2014
\u2014
1,187
Loans and advances to customers (note 22)
207,328
288,642
1,336,612
16,702
1,849,284
Debt instruments (note 23)
13,187
2,517
98
\u2014
15,802
Debt instruments at fair value through other
comprehensive income (note 23) (*)
\u2014
\u2014
1,092
\u2014
1,092
Guarantees and other commitments (note 39) (**)
12,848
13,033
84,768
\u2014
110,649
Total
233,491
305,251
1,422,570
16,702
1,978,014
(Thousands of euros)
Category
2021
Net exposure
Stage 1
Stage 2
Stage 3
POCI
Total
Financial assets at amortised cost
Loans and advances to credit institutions (note 21)
449,159
4,054
\u2014
\u2014
453,213
Loans and advances to customers (note 22)
45,906,325
7,675,410
1,349,655
41,011
54,972,401
Debt instruments (note 23)
8,081,103
119,740
4,353
\u2014
8,205,196
Debt instruments at fair value through other
comprehensive income (note 24) (*)
12,856,165
\u2014
\u2014
\u2014
12,856,165
Guarantees and other commitments (note 45) (**)
13,449,925
1,908,998
327,411
\u2014
15,686,334
Total
80,742,677
9,708,202
1,681,419
41,011
92,173,309
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements
indicated in the accounting policy 1 C1.5.1.2.
(**) Includes the balances of guarantees granted, irrevocable credit lines and revocable commitments
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as follows:
(Thousands of euros)
2022
2021
Financial assets held for trading (note 24)
Debt instruments
338,813
452,105
Derivatives
394,183
468,642
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
504,200
881,556
Hedging derivatives (note 25)
59,703
147,570
Total
1,296,899
1,949,873
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
During 2022, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2022
Financial assets at amortised cost - Loans and advances to customers -
Gross amount
Stage 1
Stage 2
Stage 3
POCI
Total
Gross amount as at 1 January
46,113,653
7,964,052
2,686,267
57,713
56,821,685
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,111,726)
2,111,726
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(258,614)
\u2014
258,614
\u2014
\u2014
Transfers from stage 2 to stage 1
1,946,027
(1,946,027)
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(631,859)
631,859
\u2014
\u2014
Transfers from stage 3 to stage 1
26,176
\u2014
(26,176)
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
174,249
(174,249)
\u2014
\u2014
Write-offs
(922)
(2,996)
(440,667)
(13,820)
(458,405)
Net balance of new financial assets and derecognised\u00a0
financial assets and other variations
681,402
(104,910)
(764,669)
3,063
(185,114)
Gross amount at the end of the year
46,395,996
7,564,235
2,170,979
46,956
56,178,166
During 2021, the changes occurred in Loans and advances to customers - gross amount are as follows:
(Thousands of euros)
2021
Financial assets at amortised cost - Loans and advances to customers - Gross amount
Stage 1
Stage 2
Stage 3
POCI
Other (1)
Total
Gross amount as at 1 January
43,702,669
7,179,503
3,188,808
86,357
(98,458)
54,058,879
Changes in gross book value:
Transfers from stage 1 to stage 2
(2,234,691)
2,234,691
\u2014
\u2014
\u2014
\u2014
Transfers from stage 1 to stage 3
(228,197)
\u2014
228,197
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 1
1,691,534
(1,691,534)
\u2014
\u2014
\u2014
\u2014
Transfers from stage 2 to stage 3
\u2014
(339,863)
339,863
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 1
30,124
\u2014
(30,124)
\u2014
\u2014
\u2014
Transfers from stage 3 to stage 2
\u2014
121,048
(121,048)
\u2014
\u2014
\u2014
Write-offs
(3,261)
(2,370)
(362,075)
(5,004)
\u2014
(372,710)
Net balance of new financial assets and
derecognised financial assets and other
variations
3,509,575
462,577
(557,354)
(23,640)
98,458
3,489,616
Transfers resulting from changes in the
Group's structure (Banque Priv\u00e9e BCP
(Suisse))
(354,100)
\u2014
\u2014
\u2014
\u2014
(354,100)
Gross amount at the end of the year
46,113,653
7,964,052
2,686,267
57,713
\u2014
56,821,685
(Banque Priv\u00e9e BCP (Suisse))
(368)
\u2014
\u2014
\u2014
(368)
Impairment losses at the end of the year
207,328
288,642
1,336,612
16,702
1,849,284
Financial assets modified during the period that have not resulted in derecognition (with impairment losses based on
expected lifetime losses) are analysed as follows:
(Thousands of euros)
Financial assets modified
2022
2021
Amortised cost before changes
396,049
612,501
Impairment losses before changes
(47,337)
(87,268)
Net amortised cost before changes
348,712
525,233
Net gain/loss arising on changes
(32,993)
(7,949)
Net amortised cost after changes
315,719
517,284
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Segment
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,213,881
2,320,624
151,906
89,857
2,562,387
284,276
142,817
427,093
10,525
28,213,886
Individuals-Other
7,614,004
958,714
118,276
42,895
1,119,885
252,456
284,486
536,942
19,621
9,290,452
Financial Companies
3,569,566
80,945
61
\u2014
81,006
72,980
1,494
74,474
7,545
3,732,591
Non-financial companies - Corporate
9,621,830
700,538
660
13
701,211
204,523
91,575
296,098
\u2014
10,619,139
Non-financial companies - SME-
Corporate
10,238,522
2,798,567
5,339
2,559
2,806,465
761,101
95,135
856,236
6,733
13,907,956
Non-financial companies -SME-Retail
6,024,603
1,683,407
30,867
14,532
1,728,806
231,377
117,109
348,486
3,453
8,105,348
Non-financial companies -Other
558,812
46,613
2
\u2014
46,615
113
\u2014
113
\u2014
605,540
Other loans
11,812,537
342,203
39
\u2014
342,242
\u2014
30
30
\u2014
12,154,809
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Individuals-Mortgage
15,380
23,667
4,083
5,262
33,012
56,519
56,440
112,959
5,452
166,803
Individuals-Other
52,559
31,277
18,676
11,224
61,177
104,108
180,916
285,024
12,436
411,196
Financial Companies
8,491
1,701
4
\u2014
1,705
36,543
1,245
37,788
\u2014
47,984
Non-financial companies - Corporate
27,484
18,218
22
\u2014
18,240
87,043
43,500
130,543
\u2014
176,267
Non-financial companies - SME-
Corporate
46,296
81,667
506
660
82,833
298,455
46,890
345,345
129
474,603
Non-financial companies -SME-Retail
78,239
92,784
4,090
3,226
100,100
106,533
51,896
158,429
\u2014
336,768
Non-financial companies -Other
512
129
\u2014
\u2014
129
5
\u2014
5
\u2014
646
Other loans
11,087
2,860
5
\u2014
2,865
\u2014
9
9
\u2014
13,961
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Individuals-Mortgage
25,198,501
2,296,957
147,823
84,595
2,529,375
227,757
86,377
314,134
5,073
28,047,083
Individuals-Other
7,561,445
927,437
99,600
31,671
1,058,708
148,348
103,570
251,918
7,185
8,879,256
Financial Companies
3,561,075
79,244
57
\u2014
79,301
36,437
249
36,686
7,545
3,684,607
Non-financial companies - Corporate
9,594,346
682,320
638
13
682,971
117,480
48,075
165,555
\u2014
10,442,872
Non-financial companies - SME-
Corporate
10,192,226
2,716,900
4,833
1,899
2,723,632
462,646
48,245
510,891
6,604
13,433,353
Non-financial companies -SME-Retail
5,946,364
1,590,623
26,777
11,306
1,628,706
124,844
65,213
190,057
3,453
7,768,580
Non-financial companies -Other
558,300
46,484
2
\u2014
46,486
108
\u2014
108
\u2014
604,894
Other loans
11,801,450
339,343
34
\u2014
339,377
\u2014
21
21
\u2014
12,140,848
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Individuals-Mortgage
0.06%
1.02%
2.69%
5.86%
1.29%
19.88%
39.52%
26.45%
51.80%
0.59%
Individuals-Other
0.69%
3.26%
15.79%
26.17%
5.46%
41.24%
63.59%
53.08%
63.38%
4.43%
Financial Companies
0.24%
2.10%
6.56%
0.00%
2.10%
50.07%
83.33%
50.74%
0.00%
1.29%
Non-financial companies - Corporate
0.29%
2.60%
3.33%
0.00%
2.60%
42.56%
47.50%
44.09%
0.00%
1.66%
Non-financial companies - SME-
Corporate
0.45%
2.92%
9.48%
25.79%
2.95%
39.21%
49.29%
40.33%
1.92%
3.41%
Non-financial companies -SME-Retail
1.30%
5.51%
13.25%
22.20%
5.79%
46.04%
44.31%
45.46%
0.00%
4.15%
Non-financial companies -Other
0.09%
0.28%
0.00%
0.00%
0.28%
4.42%
0.00%
4.42%
0.00%
0.11%
Other loans
0.09%
0.84%
12.82%
0.00%
0.84%
0.00%
30.00%
30.00%
0.00%
0.11%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by segment and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Segment
Stage 1
No delays
Days past
due <=
30 days
Days past
due > 30
days
Total
Days past
due <=
90 days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Individuals-Mortgage
25,365,328
2,305,851
126,323
66,432
2,498,606
296,980
171,593
468,573
13,320
28,345,827
Individuals-Other
7,631,117
820,962
94,862
40,061
955,885
251,607
340,511
592,118
42,163
9,221,283
Financial Companies
2,946,812
333,975
71
13
334,059
116,539
61,091
177,630
\u2014
3,458,501
Non-financial companies -
Corporate
7,994,250
920,647
436
409
921,492
209,359
365,953
575,312
\u2014
9,491,054
Non-financial companies - SME-
Corporate
9,848,761
2,914,636
8,506
2,360
2,925,502
719,045
142,057
861,102
850
13,636,215
Non-financial companies -SME-
Retail
6,469,104
2,021,279
18,127
12,285
2,051,691
329,395
98,615
428,010
1,380
8,950,185
Non-financial companies -Other
570,736
54,092
\u2014
\u2014
54,092
152
\u2014
152
\u2014
624,980
Other loans
7,293,895
272,126
\u2014
\u2014
272,126
\u2014
\u2014
\u2014
\u2014
7,566,021
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
\u2014
\u2014
Individuals-Mortgage
13,417
11,246
1,991
3,946
17,183
48,326
67,393
115,719
3,159
149,478
Individuals-Other
44,802
24,514
13,555
9,521
47,590
104,129
231,996
336,125
13,530
442,047
Financial Companies
4,990
6,966
4
3
6,973
67,871
42,746
110,617
\u2014
122,580
Non-financial companies -
Corporate
30,910
23,366
11
95
23,472
86,950
247,397
334,347
\u2014
388,729
Non-financial companies - SME-
Corporate
81,639
118,121
788
589
119,498
260,886
68,570
329,456
\u2014
530,593
Non-financial companies -SME-
Retail
47,538
82,720
2,356
2,543
87,619
143,756
51,382
195,138
13
330,308
Non-financial companies -Other
297
136
\u2014
\u2014
136
76
\u2014
76
\u2014
509
Other loans
9,898
2,780
\u2014
\u2014
2,780
\u2014
\u2014
\u2014
\u2014
12,678
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
\u2014
\u2014
Individuals-Mortgage
25,351,911
2,294,605
124,332
62,486
2,481,423
248,654
104,200
352,854
10,161
28,196,349
Individuals-Other
7,586,315
796,448
81,307
30,540
908,295
147,478
108,515
255,993
28,633
8,779,236
Financial Companies
2,941,822
327,009
67
10
327,086
48,668
18,345
67,013
\u2014
3,335,921
Non-financial companies -
Corporate
7,963,340
897,281
425
314
898,020
122,409
118,556
240,965
\u2014
9,102,325
Non-financial companies - SME-
Corporate
9,767,122
2,796,515
7,718
1,771
2,806,004
458,159
73,487
531,646
850
13,105,622
Non-financial companies -SME-
Retail
6,421,566
1,938,559
15,771
9,742
1,964,072
185,639
47,233
232,872
1,367
8,619,877
Non-financial companies -Other
570,439
53,956
\u2014
\u2014
53,956
76
\u2014
76
\u2014
624,471
Other loans
7,283,997
269,346
\u2014
\u2014
269,346
\u2014
\u2014
\u2014
\u2014
7,553,343
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Individuals-Mortgage
0.05%
0.49%
1.58%
5.94%
0.69%
16.27%
39.27%
24.70%
23.72%
0.53%
Individuals-Other
0.59%
2.99%
14.29%
23.77%
4.98%
41.39%
68.13%
56.77%
32.09%
4.79%
Financial Companies
0.17%
2.09%
5.63%
23.08%
2.09%
58.24%
69.97%
62.27%
0.00%
3.54%
Non-financial companies -
Corporate
0.39%
2.54%
2.52%
23.23%
2.55%
41.53%
67.60%
58.12%
0.00%
4.10%
Non-financial companies - SME-
Corporate
0.83%
4.05%
9.26%
24.96%
4.08%
36.28%
48.27%
38.26%
0.00%
3.89%
Non-financial companies -SME-
Retail
0.73%
4.09%
13.00%
20.70%
4.27%
43.64%
52.10%
45.59%
0.94%
3.69%
Non-financial companies -Other
0.05%
0.25%
0.00%
0.00%
0.25%
50.00%
0.00%
50.00%
0.00%
0.08%
Other loans
0.14%
1.02%
0.00%
0.00%
1.02%
0.00%
0.00%
0.00%
0.00%
0.17%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Sector of activity
Stage 1
No
delays
Days
past due
<= 30
days
Days
past due
> 30
days
Total
Days
past due
<= 90
days
Days
past due
> 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,827,885
3,279,338
270,182
132,752
3,682,272
536,732
427,303
964,035
30,146
37,504,338
Non-financial companies - Trade
5,312,463
827,990
9,921
4,283
842,194
91,204
45,688
136,892
4,715
6,296,264
Non-financial companies -
Construction
2,010,021
771,490
3,040
1,033
775,563
363,418
32,791
396,209
1,851
3,183,644
Non-financial companies -
Manufacturing industries
5,836,145
1,013,888
9,380
4,983
1,028,251
162,228
117,804
280,032
928
7,145,356
Non-financial companies -Other
activities
2,107,745
395,981
3,587
1,007
400,575
101,252
17,354
118,606
44
2,626,970
Non-financial companies - Other
services
11,177,393
2,219,776
10,940
5,798
2,236,514
479,012
90,182
569,194
2,648
13,985,749
Other Services /Other activities
15,382,103
423,148
100
\u2014
423,248
72,980
1,524
74,504
7,545
15,887,400
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
\u2014
\u2014
\u2014
Loans to individuals
67,939
54,944
22,759
16,486
94,189
160,627
237,356
397,983
17,888
577,999
Non-financial companies - Trade
22,306
26,555
1,168
1,110
28,833
35,530
20,294
55,824
129
107,092
Non-financial companies -
Construction
11,517
16,055
551
288
16,894
154,391
18,769
173,160
\u2014
201,571
Non-financial companies -
Manufacturing industries
54,925
54,821
1,293
1,258
57,372
65,474
58,761
124,235
\u2014
236,532
Non-financial companies -Other
activities
7,701
15,667
529
154
16,350
44,356
8,459
52,815
\u2014
76,866
Non-financial companies - Other
services
56,082
79,700
1,077
1,076
81,853
192,285
36,003
228,288
\u2014
366,223
Other Services /Other activities
19,578
4,561
9
\u2014
4,570
36,543
1,254
37,797
\u2014
61,945
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Loans to individuals
32,759,946
3,224,394
247,423
116,266
3,588,083
376,105
189,947
566,052
12,258
36,926,339
Non-financial companies - Trade
5,290,157
801,435
8,753
3,173
813,361
55,674
25,394
81,068
4,586
6,189,172
Non-financial companies -
Construction
1,998,504
755,435
2,489
745
758,669
209,027
14,022
223,049
1,851
2,982,073
Non-financial companies -
Manufacturing industries
5,781,220
959,067
8,087
3,725
970,879
96,754
59,043
155,797
928
6,908,824
Non-financial companies -Other
activities
2,100,044
380,314
3,058
853
384,225
56,896
8,895
65,791
44
2,550,104
Non-financial companies - Other
services
11,121,311
2,140,076
9,863
4,722
2,154,661
286,727
54,179
340,906
2,648
13,619,526
Other Services /Other activities
15,362,525
418,587
91
\u2014
418,678
36,437
270
36,707
7,545
15,825,455
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment coverage
Loans to individuals
0.21%
1.68%
8.42%
12.42%
2.56%
29.93%
55.55%
41.28%
59.34%
1.54%
Non-financial companies - Trade
0.42%
3.21%
11.77%
25.92%
3.42%
38.96%
44.42%
40.78%
2.74%
1.70%
Non-financial companies -
Construction
0.57%
2.08%
18.13%
27.88%
2.18%
42.48%
57.24%
43.70%
0.00%
6.33%
Non-financial companies -
Manufacturing industries
0.94%
5.41%
13.78%
25.25%
5.58%
40.36%
49.88%
44.36%
0.00%
3.31%
Non-financial companies -Other
activities
0.37%
3.96%
14.75%
15.29%
4.08%
43.81%
48.74%
44.53%
0.00%
2.93%
Non-financial companies - Other
services
0.50%
3.59%
9.84%
18.56%
3.66%
40.14%
39.92%
40.11%
0.00%
2.62%
Other Services /Other activities
0.13%
1.08%
9.00%
0.00%
1.08%
50.07%
82.28%
50.73%
0.00%
0.39%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
As at 31 December 2021, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by sector of activity and stage, are as follows:
(Thousands of euros)
2021
Stage 2
Stage 3
Sector of activity
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Loans to individuals
32,996,445
3,126,813
221,185
106,493
3,454,491
548,587
512,104
1,060,691
55,483
37,567,110
Non-financial companies -
Trade
5,498,200
868,334
4,967
3,001
876,302
91,994
57,333
149,327
99
6,523,928
Non-financial companies -
Construction
1,862,344
860,822
3,450
1,790
866,062
375,867
35,275
411,142
41
3,139,589
Non-financial companies -
Manufacturing industries
5,586,843
998,335
8,412
2,987
1,009,734
171,010
119,504
290,514
92
6,887,183
Non-financial companies -
Other activities
1,665,202
452,573
618
581
453,772
174,343
85,674
260,017
19
2,379,010
Non-financial companies -
Other services
10,270,262
2,730,590
9,622
6,695
2,746,907
444,737
308,839
753,576
1,979
13,772,724
Other Services /Other
activities
10,240,707
606,101
71
13
606,185
116,539
61,091
177,630
\u2014
11,024,522
Total
68,120,003
9,643,568
248,325
121,560
10,013,453
1,923,077
1,179,820
3,102,897
57,713
81,294,066
Impairment
Loans to individuals
58,219
35,760
15,546
13,467
64,773
152,455
299,389
451,844
16,689
591,525
Non-financial companies -
Trade
29,433
28,996
529
534
30,059
33,035
37,220
70,255
\u2014
129,747
Non-financial companies -
Construction
11,855
14,740
634
389
15,763
127,891
22,655
150,546
\u2014
178,164
Non-financial companies -
Manufacturing industries
33,038
30,564
473
725
31,762
49,030
53,649
102,679
12
167,491
Non-financial companies -
Other activities
9,548
17,393
123
120
17,636
87,138
41,142
128,280
\u2014
155,464
Non-financial companies -
Other services
76,510
132,650
1,396
1,459
135,505
194,574
212,683
407,257
1
619,273
Other Services /Other
activities
14,888
9,746
4
3
9,753
67,871
42,746
110,617
\u2014
135,258
Total
233,491
269,849
18,705
16,697
305,251
711,994
709,484
1,421,478
16,702
1,976,922
Net exposure
Loans to individuals
32,938,226
3,091,053
205,639
93,026
3,389,718
396,132
212,715
608,847
38,794
36,975,585
Non-financial companies -
Trade
5,468,767
839,338
4,438
2,467
846,243
58,959
20,113
79,072
99
6,394,181
Non-financial companies -
Construction
1,850,489
846,082
2,816
1,401
850,299
247,976
12,620
260,596
41
2,961,425
Non-financial companies -
Manufacturing industries
5,553,805
967,771
7,939
2,262
977,972
121,980
65,855
187,835
80
6,719,692
Non-financial companies -
Other activities
1,655,654
435,180
495
461
436,136
87,205
44,532
131,737
19
2,223,546
Non-financial companies -
Other services
10,193,752
2,597,940
8,226
5,236
2,611,402
250,163
96,156
346,319
1,978
13,153,451
Other Services /Other
activities
10,225,819
596,355
67
10
596,432
48,668
18,345
67,013
\u2014
10,889,264
Total
67,886,512
9,373,719
229,620
104,863
9,708,202
1,211,083
470,336
1,681,419
41,011
79,317,144
% of impairment coverage
Loans to individuals
0.18%
1.14%
7.03%
12.65%
1.88%
27.79%
58.46%
42.60%
30.08%
1.57%
Non-financial companies -
Trade
0.54%
3.34%
10.65%
17.79%
3.43%
35.91%
64.92%
47.05%
0.00%
1.99%
Non-financial companies -
Construction
0.64%
1.71%
18.38%
21.73%
1.82%
34.03%
64.22%
36.62%
0.00%
5.67%
Non-financial companies -
Manufacturing industries
0.59%
3.06%
5.62%
24.27%
3.15%
28.67%
44.89%
35.34%
13.04%
2.43%
Non-financial companies -
Other activities
0.57%
3.84%
19.90%
20.65%
3.89%
49.98%
48.02%
49.34%
0.00%
6.53%
Non-financial companies -
Other services
0.74%
4.86%
14.51%
21.79%
4.93%
43.75%
68.87%
54.04%
0.05%
4.50%
Other Services /Other
activities
0.15%
1.61%
5.63%
23.08%
1.61%
58.24%
69.97%
62.27%
0.00%
1.23%
Total
0.34%
2.80%
7.53%
13.74%
3.05%
37.02%
60.13%
45.81%
28.94%
2.43%
As at 31 December 2022, financial assets at amortised cost, guarantees granted, irrevocable credit lines and revocable
commitments, analysed by geography and stage, are as follows:
(Thousands of euros)
2022
Stage 2
Stage 3
Geography
Stage 1
No delays
Days past
due <= 30
days
Days past
due > 30
days
Total
Days past
due <= 90
days
Days past
due > 90
days
Total
POCI
Total
Gross Exposure
Portugal
54,604,642
7,155,127
159,209
66,646
7,380,982
1,410,285
306,213
1,716,498
19,011
63,721,133
Poland
18,184,099
1,377,667
142,519
81,498
1,601,684
386,990
343,753
730,743
28,866
20,545,392
Mozambique
1,865,014
398,817
5,422
1,712
405,951
9,551
82,680
92,231
\u2014
2,363,196
Total
74,653,755
8,931,611
307,150
149,856
9,388,617
1,806,826
732,646
2,539,472
47,877
86,629,721
Impairment
Portugal
150,039
205,954
7,124
5,447
218,525
550,372
124,012
674,384
\u2014
1,042,948
Poland
83,818
42,151
19,641
14,566
76,358
136,847
210,573
347,420
18,017
525,613
Mozambique
6,191
4,198
621
359
5,178
1,987
46,311
48,298
\u2014
59,667
Total
240,048
252,303
27,386
20,372
300,061
689,206
380,896
1,070,102
18,017
1,628,228
Net exposure
Portugal
54,454,603
6,949,173
152,085
61,199
7,162,457
859,913
182,201
1,042,114
19,011
62,678,185
Poland
18,100,281
1,335,516
122,878
66,932
1,525,326
250,143
133,180
383,323
10,849
20,019,779
Mozambique
1,858,823
394,619
4,801
1,353
400,773
7,564
36,369
43,933
\u2014
2,303,529
Total
74,413,707
8,679,308
279,764
129,484
9,088,556
1,117,620
351,750
1,469,370
29,860
85,001,493
% of impairment
coverage
Portugal
0.27%
2.88%
4.47%
8.17%
2.96%
39.03%
40.50%
39.29%
0.00%
1.64%
Poland
0.46%
3.06%
13.78%
17.87%
4.77%
35.36%
61.26%
47.54%
62.42%
2.56%
Mozambique
0.33%
1.05%
11.45%
20.97%
1.28%
20.80%
56.01%
52.37%
0.00%
2.52%
Total
0.32%
2.82%
8.92%
13.59%
3.20%
38.14%
51.99%
42.14%
37.63%
1.88%
(*) For financial assets at fair value through other comprehensive income, impairment is recorded in accordance with the requirements indicated in the
accounting policy 1 C1.5.1.2.
(**) The gross exposure includes the guarantees granted, irrevocable credit lines and revocable commitments (note 45).
As at 31 December 2021, the gross exposure, by type of financial instrument, internal rating and stage, is analysed as
follows:
(Thousands of euros)
2021
Gross Exposure
Higher quality
(GR 1-6)
Average
quality
(GR 7-9)
Lower
quality
(GR 10-12)
Procedural
(GR 13/14/15)
Not classified
(without risk
grade)
Total
Impairment
losses
Net
exposure
Financial assets at
amortised cost
stage 1
39,440,489
10,218,369
3,686,807
6,197
1,305,368
54,657,230
220,643
54,436,587
stage 2
1,650,754
1,832,802
3,828,897
284,265
494,703
8,091,421
292,219
7,799,202
stage 3
\u2014
\u2014
\u2014
2,690,023
695
2,690,718
1,336,710
1,354,008
POCI
3,001
2,535
1,096
51,081
1
57,714
16,702
41,012
41,094,244
12,053,706
7,516,800
3,031,566
1,800,767
65,497,083
1,866,274
63,630,809
Debt instruments at fair
value through other
comprehensive income (*)
stage 1
12,357,161
249,054
29,162
\u2014
220,790
12,856,167
\u2014
12,856,167
stage 3
\u2014
\u2014
\u2014
\u2014
1,092
1,092
1,092
\u2014
12,357,161
249,054
29,162
\u2014
221,882
12,857,259
1,092
12,856,167
Guarantees and other
commitments (**)
stage 1
8,383,240
3,632,450
1,183,525
192
263,366
13,462,773
12,848
13,449,925
stage 2
197,624
509,335
919,049
42,849
253,175
1,922,032
13,032
1,909,000
stage 3
\u2014
\u2014
\u2014
412,179
\u2014
412,179
84,768
327,411
8,580,864
4,141,785
2,102,574
455,220
516,541
15,796,984
110,648
15,686,336
Total
62,032,269
16,444,545
9,648,536
3,486,786
2,539,190
94,151,326
1,978,014
92,173,312
As at 31 December 2021, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by segment, are presented in the following
table
(Thousands of euros)
2021
Gross Exposure
Impairment losses
Segment
Individual
Collective
Total
Individual
Collective
Total
Individuals - Mortgage
46,604
28,299,223
28,345,827
14,081
135,397
149,478
Individuals - Other
30,802
9,190,481
9,221,283
18,753
423,294
442,047
Financial Companies
171,875
3,286,626
3,458,501
110,524
12,056
122,580
Non-financial companies - Corporate
520,987
8,970,067
9,491,054
325,523
63,206
388,729
Non-financial companies - SME - Corporate
650,958
12,985,257
13,636,215
290,432
240,161
530,593
Non-financial companies -SME - Retail
248,059
8,702,126
8,950,185
127,132
203,176
330,308
Non-financial companies - Other
152
624,828
624,980
76
433
509
Other loans
\u2014
7,566,021
7,566,021
\u2014
12,678
12,678
Total
1,669,437
79,624,629
81,294,066
886,521
1,090,401
1,976,922
As at 31 December 2022, the financial assets at amortised cost, guarantees granted, irrevocable credit lines and
revocable commitments subject to individual and collective impairment, by sector of activity are presented in the
following table:
(Thousands of euros)
2022
Gross Exposure
Impairment losses
Sector of activity
Individual
Collective
Total
Individual
Collective
Total
Loans to individuals
57,653
37,446,685
37,504,338
27,929
550,070
577,999
Non-financial companies - Trade
56,649
6,239,615
6,296,264
30,640
76,452
107,092
Non-financial companies - Construction
308,289
2,875,355
3,183,644
158,454
43,117
201,571
Non-financial companies - Manufacturing
industry
173,248
6,972,108
7,145,356
93,885
142,647
236,532
Non-financial companies - Other activities
95,832
2,531,138
2,626,970
44,541
32,325
76,866
Non-financial companies - Other services
454,653
13,531,096
13,985,749
195,688
170,535
366,223
Other Services /Other activities
81,059
15,806,341
15,887,400
37,622
24,323
61,945
Total
1,227,383
85,402,338
86,629,721
588,759
1,039,469
1,628,228
The columns Gross exposure and Collective impairment losses of the previous tables include loans subject to individual
analysis for which the Group has concluded that there is no objective evidence of impairment.
As at 31 December 2022, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet - it\u00a0 does not include restructured loans):
2022
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2012 and previous
Number of operations
15,703
25,791
293,344
677,001
384
1,012,223
Value (Euros '000)
970,246
3,194,423
10,117,624
1,228,014
81,780
15,592,087
Impairment constituted (Euros '000)
73,617
51,428
106,931
17,378
646
250,000
2013
Number of operations
1,121
3,600
10,115
65,523
17
80,376
Value (Euros '000)
64,192
510,025
376,049
106,759
2,537
1,059,562
Impairment constituted (Euros '000)
3,236
3,441
5,681
3,329
6
15,693
2014
Number of operations
1,234
4,859
8,737
82,035
86
96,951
Value (Euros '000)
76,217
509,250
356,743
126,516
183,780
1,252,506
Impairment constituted (Euros '000)
5,049
9,235
4,719
4,618
855
24,476
2015
Number of operations
1,691
6,284
10,836
112,676
124
131,611
Value (Euros '000)
106,007
908,354
515,361
185,482
44,947
1,760,151
Impairment constituted (Euros '000)
1,947
23,398
3,874
9,116
27,758
66,093
2016
Number of operations
1,911
8,196
12,280
134,403
55
156,845
Value (Euros '000)
154,183
1,209,277
616,181
256,858
4,248
2,240,747
Impairment constituted (Euros '000)
5,274
13,961
4,432
17,195
174
41,036
2017
Number of operations
2,568
11,100
20,277
142,014
96
176,055
Value (Euros '000)
219,318
1,228,140
1,202,742
305,913
13,230
2,969,343
Impairment constituted (Euros '000)
2,807
17,900
5,830
21,347
720
48,604
2018
Number of operations
5,312
19,488
26,701
286,638
203
338,342
Value (Euros '000)
498,338
2,227,925
1,833,809
655,719
309,885
5,525,676
Impairment constituted (Euros '000)
7,262
32,931
6,511
43,836
1,607
92,147
2019
Number of operations
8,703
27,962
30,166
595,430
185
662,446
Value (Euros '000)
632,970
2,098,246
2,198,981
1,221,662
144,135
6,295,994
Impairment constituted (Euros '000)
7,295
45,754
5,735
75,179
3,002
136,965
2020
Number of operations
9,891
37,416
36,088
313,758
255
397,408
Value (Euros '000)
1,148,968
4,324,442
2,656,294
809,745
165,228
9,104,677
Impairment constituted (Euros '000)
13,228
83,686
7,361
42,424
1,638
148,337
2021
Number of operations
10,744
37,545
53,486
524,347
340
626,462
Value (Euros '000)
1,146,704
3,355,457
4,464,436
1,376,201
388,696
10,731,494
Impairment constituted (Euros '000)
15,760
51,953
8,848
61,243
2,299
140,103
2022
Number of operations
14,046
117,544
38,354
1,108,878
4,678
1,283,500
Value (Euros '000)
2,097,778
7,566,584
3,822,846
2,514,949
364,556
16,366,713
Impairment constituted (Euros '000)
19,365
169,939
5,788
64,160
2,593
261,845
Total
Number of operations
72,924
299,785
540,384
4,042,703
6,423
4,962,219
Value (Euros '000)
7,114,921
27,132,123
28,161,066
8,787,818
1,703,022
72,898,950
Impairment constituted (Euros '000)
154,840
503,626
165,710
359,825
41,298
1,225,299
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2021, the following table includes the loans portfolio by segment and by year of production (date of
the beginning of the operations, in the portfolio at the date of balance sheet\u00a0 - it does not include restructured loans):
2021
Year of production
Construction
and Commercial
Real Estate
Companies -
Other\u00a0 Activities
Mortgage
loans
Individuals -
Other
Other loans
Total
2011 and previous
Number of operations
16,443
27,013
312,064
707,279
493
1,063,292
Value (Euros '000)
988,051
3,546,686
11,518,139
1,202,309
96,963
17,352,148
Impairment constituted (Euros '000)
74,609
59,229
112,005
25,236
824
271,903
2012
Number of operations
1,184
3,463
11,387
103,094
184
119,312
Value (Euros '000)
80,315
213,802
401,586
144,851
10,158
850,712
Impairment constituted (Euros '000)
3,837
5,324
4,751
4,355
35
18,302
2013
Number of operations
1,641
4,653
11,229
107,983
33
125,539
Value (Euros '000)
81,722
576,793
442,501
136,479
8,762
1,246,257
Impairment constituted (Euros '000)
4,471
8,084
5,580
5,122
5,108
28,365
2014
Number of operations
1,641
6,271
9,805
116,968
95
134,780
Value (Euros '000)
105,894
645,718
422,736
166,061
190,746
1,531,155
Impairment constituted (Euros '000)
3,970
20,745
4,348
7,486
2,191
38,740
2015
Number of operations
2,289
8,314
12,051
161,566
135
184,355
Value (Euros '000)
118,689
964,423
598,334
241,761
42,217
1,965,424
Impairment constituted (Euros '000)
2,824
28,579
3,728
16,198
19,417
70,746
2016
Number of operations
2,669
11,649
13,803
182,204
76
210,401
Value (Euros '000)
163,829
1,478,862
722,220
354,356
4,193
2,723,460
Impairment constituted (Euros '000)
6,010
38,956
3,929
28,921
200
78,016
2017
Number of operations
3,601
16,424
22,504
206,982
135
249,646
Value (Euros '000)
277,439
1,670,775
1,398,081
429,457
18,044
3,793,796
Impairment constituted (Euros '000)
5,095
23,129
4,472
35,979
680
69,355
2018
Number of operations
6,750
28,128
29,336
361,525
252
425,991
Value (Euros '000)
765,450
2,700,168
2,109,180
893,124
334,778
6,802,700
Impairment constituted (Euros '000)
10,003
53,212
4,375
66,397
1,688
135,675
2019
Number of operations
10,349
35,279
33,145
703,461
255
782,489
Value (Euros '000)
916,637
2,723,462
2,540,307
1,582,002
181,729
7,944,137
Impairment constituted (Euros '000)
9,757
69,372
2,964
95,816
2,883
180,792
2020
Number of operations
11,226
42,426
39,282
450,557
362
543,853
Value (Euros '000)
1,671,233
5,360,650
3,082,954
1,138,368
268,429
11,521,634
Impairment constituted (Euros '000)
19,037
87,662
4,534
44,968
2,008
158,209
2021
Number of operations
14,097
107,313
56,969
994,034
5,019
1,177,432
Value (Euros '000)
1,729,149
6,506,623
5,006,493
2,353,761
513,072
16,109,098
Impairment constituted (Euros '000)
17,888
88,776
7,652
35,963
2,954
153,233
Total
Number of operations
71,890
290,933
551,575
4,095,653
7,039
5,017,090
Value (Euros '000)
6,898,408
26,387,962
28,242,531
8,642,529
1,669,091
71,840,521
Impairment constituted (Euros '000)
157,501
483,068
158,338
366,441
37,988
1,203,336
In the year of the current production, are included operations that, by their nature, are contractually subject to
renewals. In these cases, the date of the last renewal is considered, namely for overdraft operations, secured current
account and factoring operations.
As at 31 December 2022, the following table includes the fair value of the collaterals by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2022
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,822
9,575
9,030
71,315
468,372
303
Value (Euros '000)
882,242
223,661
1,369,613
1,489,242
62,924,078
17,038
>= 0.5 M\u20ac and < 1 M\u20ac
Number
741
70
1,189
236
6,321
4
Value (Euros '000)
520,105
47,186
832,819
162,741
4,080,818
2,230
>= 1 M\u20ac and < 5 M\u20ac
Number
634
47
1,110
205
1,062
1
Value (Euros '000)
1,307,513
84,190
2,223,387
395,940
1,636,182
1,267
>= 5 M\u20ac and < 10 M\u20ac
Number
108
2
118
15
14
\u2014
Value (Euros '000)
737,705
10,838
852,256
102,251
86,476
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
50
2
57
13
1
\u2014
Value (Euros '000)
651,146
21,833
809,825
194,916
11,110
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
22
\u2014
40
1
\u2014
\u2014
Value (Euros '000)
636,352
\u2014
1,208,432
20,452
\u2014
\u2014
>= 50 M\u20ac
Number
6
\u2014
14
2
\u2014
\u2014
Value (Euros '000)
455,600
\u2014
1,245,381
523,630
\u2014
\u2014
Total Number
8,383
9,696
11,558
71,787
475,770
308
Total\u00a0 Value (Euros '000)
5,190,663
387,708
8,541,713
2,889,172
68,738,664
20,535
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2021, the following table includes the fair value of the collaterals\u00a0 by segments (not limited by the
value of the collateral) associated to the loan's portfolio:
2021
Construction and Commercial
Real Estate
Companies - Other Activities
Mortgage loans
Fair Value
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
Real Estate
(*)
Other real
Collateral (**)
< 0.5 M\u20ac
Number
6,479
10,273
9,346
74,677
476,204
321
Value (Euros '000)
868,524
238,345
1,412,766
1,495,825
60,342,081
17,349
>= 0.5 M\u20ac and < 1 M\u20ac
Number
763
63
1,231
249
5,567
6
Value (Euros '000)
522,827
40,591
858,038
170,352
3,594,194
3,534
>= 1 M\u20ac and < 5 M\u20ac
Number
550
57
1,092
207
883
1
Value (Euros '000)
1,125,581
105,005
2,173,966
388,273
1,337,278
1,474
>= 5 M\u20ac and < 10 M\u20ac
Number
100
3
119
20
10
\u2014
Value (Euros '000)
696,758
16,515
844,212
134,534
63,256
\u2014
>= 10 M\u20ac and < 20 M\u20ac
Number
44
3
51
15
1
\u2014
Value (Euros '000)
595,828
40,128
687,338
224,766
11,047
\u2014
>= 20 M\u20ac and < 50 M\u20ac
Number
33
\u2014
35
1
\u2014
\u2014
Value (Euros '000)
958,264
\u2014
1,032,578
49,281
\u2014
\u2014
>= 50 M\u20ac
Number
4
\u2014
13
3
\u2014
\u2014
Value (Euros '000)
260,929
\u2014
1,108,030
827,069
\u2014
\u2014
Total Number
7,973
10,399
11,887
75,172
482,665
328
Total\u00a0 Value (Euros '000)
5,028,711
440,584
8,116,928
3,290,100
65,347,856
22,357
(*) The fair value of real estate collateral relates to the PVT included in valuations.
(**) Includes, namely, securities, deposits and fixed assets pledges.
As at 31 December 2022, the following table includes the LTV (loan-to-value) ratio by segments Construction and
Commercial Real Estate (CRE), Companies - Other Activities and Mortgage loans:
(Thousands of euros)
2022
Segment/Ratio
Number
of properties
Stage 1
Stage 2
Stage 3
Impairment
Construction and CRE
Without associated collateral
n.a.
1,528,695
453,957
73,399
70,799
<60%
25,799
1,019,694
259,169
42,667
31,589
>=60% and <80%
2,771
376,094
81,106
21,337
9,536
>=80% and <100%
1,067
131,874
46,414
58,121
49,541
>=100%
979
74,888
73,472
61,705
40,249
Companies - Other Activities
Without associated collateral
n.a.
10,285,172
1,651,463
284,131
393,519
<60%
49,259
1,563,296
495,030
141,344
65,781
>=60% and <80%
16,491
991,449
329,502
128,863
48,995
>=80% and <100%
11,106
576,326
406,133
72,826
47,386
>=100%
2,741
654,901
202,769
280,711
146,244
Mortgage loans
Without associated collateral
n.a.
53,715
2,892
10,403
10,816
<60%
383,344
13,363,029
1,310,064
261,616
102,636
>=60% and <80%
129,126
8,530,613
844,549
112,000
32,431
>=80% and <100%
39,677
2,884,194
357,767
58,421
19,953
>=100%
6,013
235,017
60,244
30,008
15,674
Credit portfolio monitoring process
The Bank adjusted its credit portfolio management and monitoring processes, namely with regard to the assessment of
the potential impacts of the macroeconomic context on the risk profile of the different portfolios/segments of
exposure, an approach that was consolidated in 2022.
This modification, that began in 2020, was based on the creation of a specific approach with the objective of
identifying and closely monitoring the customers potentially more affected by the macroeconomic context, anticipating
possible difficulties in complying their responsibilities and defining credit and performance strategies adjusted to the
specific specificities of each customer/group of customers, with a view to both maintaining support to customers
considered viable and mitigating credit risk.
The importance of this new approach is reinforced by the uncertainty that impacted the activity in recent times. In
fact, while it is true that the effects of the pandemic have faded, new risks have emerged in the meantime, especially
those resulting from the geopolitical conflict between Russia and Ukraine, reinforcing threats that were already
appearing in areas such as constraints in logistics and distribution chains, limitations in access to raw materials and
certain goods, increased energy costs, inflationary pressures and rising interest rates.
The main guidelines of the credit portfolio monitoring approach can be characterized as presented below:
- Global and transversal: Is supported by an analysis of the entire credit portfolio of the Bank, being excluded from the
special monitoring only customers with a better risk profile (in the case of retail) or with exposures of a lower size (in
the case of retail and corporate).
- Specialized: Monitoring by the \u201cComit\u00e9 de Acompanhamento de Risco de Empresas\u201d (CARE), and Credit Division in
coordination with the Rating Division for the corporate segment and by the Retail Recovery Division for individuals and
small businesses. The cases monitored by the CARE Committee, which is conducted at least monthly, are related to
clients covered by a set of criteria that combine exposure size and risk factors like the rating assigned, IFRS 9 staging
and, for the corporate segment, the level of leverage and whether the sector in which it operates is considered highly
vulnerable.
- Segmented: Prioritization of approach/analysis recurrence based on risk signs, in order to gather additional
information and agree on appropriate and sustainable financial restructuring solutions in a timely manner.
- Prospective: Definition of predictive models, in order to anticipate potential future defaults, avoiding a reactive
approach.
- Standardized: Both in terms of risk models and monitoring, and in terms of credit solutions for which it is possible to
identify pre-defined alternatives (retail segments).
- Convenient and innovative: Making the restructuring journey simpler and more convenient both in terms of credit
solutions and channels, extending the restructuring offer to the App for consumer credit and mortgages.
Specifically in the corporate segment, the process of portfolio follow-up and monitoring can be generically
characterized as described below, having as a fundamental component the attribution of credit strategies, among pre-
defined options, with review periods differentiated according to the level of risk associated to the strategy attributed:
1. Client Assessment and presentation of Indicative Credit Strategy by the Rating Division (for customers with ratings
assigned by corporate rating models);
2. Approval, by the competent credit decision levels, of a credit strategy for each customer, taking into consideration
the Indicative Credit Strategy received from the Rating Division, the proposals received from the area that follows the
client and the inputs received as a result of the customer interaction process;
3. Decision, negotiation and formalisation of the operations that will ensure that the approved strategy is pursued and
the approved credit limits are met (Credit Division, Areas that follow the client and Operations Division);
4. Monitoring the Credit Strategy and the evolution of the customer's activity (Credit Division, Areas that follow the
client and Specialised Committees - CARE);
5. Monitoring of the credit portfolio and effectiveness of the portfolio monitoring process and credit strategy
attribution (Risk Office), based on a set of KPIs, (e.g. percentage of the credit portfolio with valid risk strategy;
evolution of credit exposure to customers with a reduction strategy; adequacy of the credit strategy to the customer's
performance);
6. In the attribution of the customer's credit strategy, besides the intrinsic factors of the customer, more transversal
factors are taken into consideration, such as the evaluation of the sectorial risk and ESG impacts (periodically reviewed
with the support of the Economic, Sustainability and Criptoactives Studies Division)
7. The occurrence of effective and/or potential risk events (signs of default/delinquency; breach of contractual
covenants; severe alteration in sector risk; alteration in the corporate/shareholder structure), trigger an extraordinary
revision of the strategy.
Within the scope of this monitoring process and with an impact on other and differentiated procedures adopted by the
Bank, namely for reporting purposes, the Bank defines a list of sectors considered as more vulnerable to the
macroeconomic environment, which is reviewed periodically (at least annually).
At least once a year the Bank produces a report presenting a detailed characterisation of its loan portfolio under a
sectoral perspective.
Additional measures with impact on the Impairment level
i. Updating macroeconomic scenarios and the parameters of the collective impairment model
Taking into account the changes and uncertainty of the context and the economic perspectives essentially marked by a
transition from a pandemic context to one conditioned by expressive rises in the inflation and interest rate levels, as
well as by crisis in various supply chains, it was decided to update the regressions and macroeconomic scenarios
considered in the collective analysis model in Portugal, namely with the aim to capture the effect of variables such as
inflation and interest rates.
Specifically, in what regards the macroeconomic scenarios, at the end of December the macroeconomic assumptions
used in the impairment calculation were updated, based on three scenarios (Central Scenario, Upside and Downside)
prepared by the Bank's Economic Studies Department.
The referred scenarios, which are used in the Bank for several purposes other than the impairment calculation, took
into consideration the existing projections of reputed entities.
The tables below systematise the assumptions considered for Portugal for the central scenarios with regard to some of
the most critical variables used in the calculation of collective impairment with reference to 31 December 2022.
Update of main macroeconomic scenario assumptions (Base Scenario) - Portugal
December 2022 Scenario
Variable
2022
2023
Unemployment rate
5.86%
5.88%
3 months Euribor Rate
0.65%
3.34%
Savings Rate
4.4%
5.8%
Inflation Rate
8.06%
5.83%
ii. Impairment overlays
In order to incorporate an additional level of conservatism in the impairment values, the Bank defined and
implemented a methodology of complementary identification of situations of significant increase in credit risk and signs
of impairment. This approach adopts complementary and distinct criteria in relation to the methodologies in force,
with distinct processes having been adopted for the calculation of overlays for the corporate and individual customers
segments.
In fact, the impacts related to the COVID-19 pandemic have been losing expression, namely as a result of the time
elapsed since the end of the large majority of the moratoria (September 2021) and given that some of the most
affected sectors have already overcome the challenges posed by this crisis.\u00a0 However, there is a level of uncertainty
associated with the current geopolitical crisis, disruption in distribution chains, rising energy costs and inflationary
pressures.
Under this framework, in Portugal, the Bank has changed its methodology for the overlays calculation, adopting an
approach which reflects the context described above, which implied a disruption to the framework which prevailed up
to the end of 2021, characterized by low levels of interest rates and inflation.
This positioning is in line with the guidelines on this matter issued by the Supervisors in what regards the identification
and measurement of credit risk in contexts of uncertainty, so that the release of overlays constituted in the context of
the pandemic should be carried out with prudence and taking into account the possible need for new overlays to
respond to the current context.
The exercise carried out reflected, in terms of impairment value, in the calculation of the estimated impact arising
from potential migrations of customers with higher risk to Stage 2 and Stage 3, based on the various factors considered
in the analysis. It should be noted that the most significant impact occurred in the corporate segment. The
methodology developed by the Bank was considered for the calculation and recording of impairment at the reference
date of the accounts, without affecting the classification of credit exposures by stages in the Bank's loan portfolio.
In Poland, the Bank also adopted a policy of recording overlays. Taking into consideration the country's specific reality,
adjustments to the overlays methodology had already been incorporated in the first half of the year to address the
impacts of the geopolitical crisis.
As a result of the implementation of this methodology, the Bank calculated an additional impairment to that resulting
from the collective analysis model, therefore with characteristics of overlays, whose amount on 31 December 2022 was
approximately Euros 95.0 million in Portugal (Euros 71.1 million in June 2022) and Euros 33.9 million in Poland (Euros
23.4 million in June 2022).
ii. Risk Grade freeze of clients rated by behavioural models\u00a0
Assuming a conservative perspective, in Portugal, the Bank implemented a procedure whereby it identified the
customers subject to moratorium with internal risk rating awarded by behavioural models that at the end of December
showed an improvement in the risk level in comparison with the one existing before the moratoria and, for these cases,
assumed for purposes of staging criteria and impairment calculation the maintenance of that pre-moratoria risk rating.
This procedure did not imply a change in the internal risk rating attributed by the Bank.
From March 2022 onwards the above-mentioned procedure was no longer applied, given that the vast majority of
moratoria had ended in September 2021 and the remaining in the end of December 2021. As such, the Bank considered
that an elapsed period is more than enough to consider that the behavioural rating models are no longer affected by
the previous existence of moratoria.
Operations subject to legislative and non-legislative moratorium and new loans granted under
new public guaranteed systems introduced in response to the COVID-19 crisis
The following tables characterize the transactions that, as of 31 December 2022 and 31 December 2021, were subject
to legislative and non-legislative moratorium, as well as new loans granted under new public guaranteed systems
introduced in response to the COVID-19 crisis, at consolidated level.
As of 31 December 2022 and 31 December 2021, the amounts related with the moratoria in force are null.
Loans and advances subject to legislative and non-legislative moratorium
The analysis of the gross carrying amount and respective impairment, of loans and advances that have ever been
subject to legislative and non-legislative moratorium, with reference as at 31 December 2022:
(Thousands of euros)
Gross carrying amount
Performing\u00a0
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Inflows to
non-
performing
exposures
in the last
12 months
Loans and advances
subject to
moratorium
8,626,118
7,753,682
360,015
2,181,916
872,436
584,806
740,621
373,358
of which: Households
4,417,087
4,177,902
234,854
857,087
239,185
143,336
159,863
112,404
of which:
Collateralised by
residential
immovable property
3,875,782
3,733,170
202,408
748,053
142,612
89,873
111,963
72,969
of which: Non-
financial corporations
4,141,382
3,526,701
122,418
1,313,634
614,681
422,915
562,204
260,941
of which: Small and
Medium-sized
Enterprises
3,789,598
3,235,758
121,308
1,231,214
553,840
388,948
504,124
236,774
of which:
Collateralised by
commercial
immovable property
1,577,218
1,138,663
65,753
565,159
438,555
332,263
422,964
205,280
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(Thousands of euros)
Accumulated impairment (**)
Performing
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Loans and advances subject
to moratorium
468,971
98,882
8,658
79,585
370,089
282,736
314,400
of which: Households
86,079
21,528
2,729
16,837
64,551
35,542
31,950
of which: Collateralised
by residential immovable
property
30,227
9,901
1,004
8,193
20,326
13,993
15,261
of which: Non-financial
corporations
363,087
76,077
5,379
61,625
287,010
228,671
263,927
of which: Small and
Medium-sized Enterprises
325,495
72,282
5,295
59,311
253,213
209,448
231,738
of which: Collateralised
by commercial immovable
property
211,680
25,768
2,003
23,236
185,912
162,720
181,168
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(**) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of this note.
The analysis of the gross carrying amount and respective impairment, of loans and advances that have ever been
subject to legislative and non-legislative moratorium, with reference as at 31 December 2021:
(Thousands of euros)
Gross carrying amount
Performing\u00a0
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Inflows to
non-
performing
exposures\u00a0
in the last
12 months
Loans and advances
subject to
moratorium
10,939,554
9,990,621
696,426
3,145,093
948,933
603,174
834,070
333,500
of which: Households
5,212,656
4,968,993
258,573
1,038,745
243,663
145,907
183,807
148,835
of which:
Collateralised by
residential
immovable property
4,533,171
4,384,126
228,269
915,413
149,045
97,934
134,940
77,684
of which: Non-
financial corporations
5,632,584
4,952,474
436,068
2,046,523
680,110
436,937
625,105
184,663
of which: Small and
Medium-sized
Enterprises
5,085,424
4,503,348
372,415
1,847,727
582,076
379,997
564,032
160,075
of which:
Collateralised by
commercial
immovable property
1,895,246
1,590,586
286,092
988,440
304,660
179,465
302,064
100,596
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(Thousands of euros)
Accumulated impairment (**)
Performing
Non-performing
Total
Of which:
exposures
with
forbearance
measures
Of which
Stage 2 (*)
Of which:
exposures
with
forbearance
measures
Of which:
Unlikely to pay
that are not
past-due or
past-due <= 90
days
Loans and advances subject
to moratorium
553,384
149,636
30,170
116,166
403,748
292,759
341,535
of which: Households
82,892
23,826
1,263
15,128
59,066
28,719
32,192
of which: Collateralised
by residential immovable
property
27,624
8,881
650
5,337
18,743
11,215
15,451
of which: Non-financial
corporations
443,230
123,257
28,399
98,551
319,973
244,161
284,634
of which: Small and
Medium-sized Enterprises
380,880
115,080
26,813
92,831
265,800
202,059
258,473
of which: Collateralised
by commercial immovable
property
178,995
56,281
22,189
52,713
122,714
88,507
122,342
(*) Instruments with significant increase in credit risk since initial recognition but not credit-impaired.
(**) The impairment presented in the table does not include the amounts of impairment calculated using the overlays methodology described in
point ii. of the section \"Additional measures with impact on the Impairment level\" of this note.
Loans and advances granted under new public guaranteed schemes introduced in response to the COVID-19 crisis
In what concerns the loans granted under new public guaranteed schemes, we present below the exposure breakdown
by segment, the amount of the associated guarantee and an indication of the portion classified as restructured due to
financial difficulties or classified as non-performing is presented.
As at 31 December 2022, the analysis of the loans and advances subject to public guarantee schemes is as follows:
(Thousands of euros)
2022
Gross carrying amount
Maximum amount of
the guarantee that
can be considered
Gross carrying amount
of which:
forborne
Public guarantees
received
Inflows to non-performing
exposures in the last 12
months
Newly originated loans and advances subject
to public guarantee schemes
2,364,357
2,427
1,955,939
22,442
of which: Households
12,240
\u2014
10,836
168
\u00a0 of which: Collateralised by residential
immovable property
233
\u2014
210
\u2014
of which: Non-financial corporations
2,351,605
2,427
1,944,663
22,268
of which: Small and Medium-sized
Enterprises
2,162,873
2,427
1,810,326
22,268
of which: Collateralised by commercial
immovable property
81,559
\u2014
60,860
1,006
suppliers/customers, from the Ukraine, Russia and Belarus markets, above 15%, were considered as potentially more
vulnerable and were assessed on a case-by case-basis.
- Regarding a more-broader macroeconomic perspective (3rd order effects), the Bank updated at the end of the first
semester the list of sectors potentially more vulnerable to the current macroeconomic and geopolitical context, which
remains in force.
In what concerns the internal rating structure of the credit portfolio in vulnerable sectors, we can conclude that 7,5%
of the portfolio is classified as non-performing and around 54% are allocated to risk grade 8 or better.
For those clients potentially more affected, directly and/or indirectly, by the conflict it was applied a bottom-up
monitoring approach.
The bottom-up assessment is supported by the combination of a comprehensive credit monitoring initiatives, notably:
1. the update of the impairment signs questionnaire (for customers with more significant exposures).
2. the process of assignment of a set of pre-defined credit strategy to each client (less favourable strategies have
shorter periods of validity and the assignation of a \"minimization of expected loss\u201d strategy implies the reclassification
of the Client to Stage 3.)
3. specific engagement questionnaire sent to corporate clients to assess the impacts of the conflict after it arose, and
its conclusions are considered to remain valid, as the reality found in the daily interaction with clients confirms.
Until the end of December 2022, no relevant signs of risk continue to be not identified (the total volume of credits
associated with performing clients with past due exposures represents only 0,2% of total exposures).
In Poland the analysis of the impact in Corporate clients was supported on a case-by-case review of a significant part of
the corporate portfolio, independently of the sector of activity of each client.
Following the review of the companies' exposures, namely taking into account the 15% materiality/exposure factor
mentioned above, Bank Millennium (Poland) conducted a separate check of the companies exposed to risks related to
the conflict in Ukraine, and a subset of companies with a total exposure of EUR 81.8 million (Q3 2022 figures),
equivalent to only 1.4% of the Bank Millennium Group's portfolio of companies. All the companies identified have
already implemented measures to diversify their supply chains, so no company was considered that needed being
treated as significantly exposed to this risk. Regardless of the positive experience to date, Bank Millennium Group
decided to temporarily avoid increasing funding to this set of companies.
Application of Decree-Law 80-A/2022 - Mitigation of impacts on mortgage contracts
Specifically with regard to Decree-Law 80-A/2022, a Portuguese Government act of 25 November 2022 that established
measures to mitigate the effects of the increase in the reference indexing factors of credit contracts for the acquisition
or construction of permanent house ownership, it is worth highlighting the fact that it introduced the obligation for
Financial Institutions to approach individual customers with mortgage credit who potentially fit into the requirements
set out in that act.
In what concerns Millennium bcp, a contact was promoted with about 180 thousand customers, requesting information
in order to calculate the respective effort rate. At the end of December 2022, the number of customers who showed
interest in joining the mechanisms provided for in Decree-Law 80-A/2022 was limited, especially given that the
deadline for replying to the Bank's contact only ended in January 2023.
On 28 February 2023 the number of restructuring requests under Decree Law 80-A/2022 amounted to only 5 thousand
customers, of which only 4 thousand meet the conditions for potential implementation of restructuring measure.
Credit concentration risk
The Group\u2019s policy relating to the identification, measurement, and evaluation of the concentration risk in credit risk is
approved by the Bank\u2019s management body, applied to all Group entities, and is based on the following guidelines:
The monitoring of the concentration risk and the follow-up of major risks is made, at Group level, based on the concept
of \"Economic Groups\" and \u201cCustomer Groups\u201d - sets of connected Customers (individual persons or companies), which
represent a single entity from a credit risk perspective, such that if one of them is affected by financial problems, one
or all of the others, will probably face difficulties to fulfil their debtor obligations. The Customer connections that
originate a Customer group include the formal participation on the same economic group, the evidence that a direct or
indirect control relationship exists, including the control by an individual Customer (criteria of capacity of control) of a
company or the existence of a strong commercial interdependency or common sources of funding that cannot be
replaced on a short term (criteria of economic dependency).The identification of connected clients is an integral part
of the credit granting and monitoring processes of each entity.
For the control of credit concentration risk and limit the exposure to this risk, there are limits defined for:
1)Exposures to Sovereigns;
2)Exposures to Institutions (Banks/financial institutions);
3)Single-name exposures (Large Corporate exposures);
4)Geographic concentration (country risk);
5)Exposure to sectors of activity.
These limits apply to the \u2018Net exposures\u2019 (*), relating either to a counterparty or a group of counterparties \u2013 cases for
1), 2) and 3) \u2013 or to the set of exposures to an activity sector or to a country (the counterparty country of residence) \u2013
cases for 4) and 5). The metrics regarding the concentration of exposure to Sovereigns and geographic concentration
exclude the countries in which the Group has significant operations (Portugal, Poland and Mozambique) and the
respective Sovereigns.
Except for exposure to sectors of activity, the concentration limits are established by taking into consideration the
credit worthiness of the debtors at stake in what concerns their rating grades/probability of Default (PD) (internal or
external ratings; country rating in the case of geographic concentration).
The concentration limits for Corporate single-name exposures apply only to non-NPE positions, since the NPE(**)
positions are covered by the NPE reduction Plan defined and executed at Group BCP level.
The limits in force as at 31 December 2022, for the exposure to Single-name, in terms of the Net Exposure weight over
the Consolidated Own Funds, are the following:
Risk quality
Risk grade
Single-name
High quality
1 - 5
7.0%
Average/good quality
6 - 7
4.5%
Average low/quality
8 - 9
3.0%
Low quality
10 - 11
0.6%
Restricted credit
12 - 13
0.3%
(*) Net exposure = EAD x LGD, considering LGD=45% whenever own estimates for LGD are not available or applicable. EAD = Exposure
at default ; LGD = Loss given Default;
(**) NPE = Non-performing exposures
As at 31 December 2022:
- There were no exposure excesses to Sovereigns, Institutions or countries;
- There were 4 Economic Groups with net exposure above the established Single-name limits for their respective risk
grade. For each client with an exposure excess a specific plan is prepared, aiming at reducing the exposure and
bringing it within the established limits.
It should also be referred that the assessment of the Single-name concentration is also performed within the Group RAS
(Risk Appetite Statement) scope.
In what concerns the limit for exposure to sectors of activity, in force on 31 December 2022, this is defined as a
maximum of 40% per sector of activity, in terms of the weight of the Net Exposure for each sector of activity over the
Own Funds of each Group Entity. At this date, there was no excess over this limit.
The Bank's management body and the Risk Assessment Committee are regularly informed on the evolution of the credit
concentration risk metrics (against the mentioned limits) and on major risks.
The credit concentration risk is measured and monitored by the Risk Office supported on a database on credit
exposures (the Risk Office Datamart), monthly updated by the Group\u2019s systems, which feeds the risk management
system of the Group.
The Risk Office maintains a simulation tool for supporting the analysis of the impact on changes on the Customers
exposures in the consumption of the respective concentration limits, which is used by the Credit Division and by the
Commercial Networks within the scope of credit analysis for large clients.
Market risk
Market risks consist of the potential losses that might occur in a given portfolio as a result of changes in interest or
exchange rates and/or in the prices of the different financial instruments of the portfolio, considering not only the
correlations that exist between those instruments but also their volatility.
For purposes of profitability analysis and market risks quantification and control, the following management areas are
defined for each entity of the Group:
- Trading - Management of positions whose objective is the achievement of short-term gains, through sale or
revaluation. These positions are actively managed, tradable without restriction and may be valued frequently and
accurately. The positions in question include securities and derivatives of sales activities;
- Funding - Management of institutional funding (wholesale funding) and money market positions;
\u2013Investment - Management of all the positions in securities to be held to maturity (or for a longer period of time) or
positions which are not tradable on liquid markets;
- Commercial - Management of positions arising from commercial activity with Customers;
- Structural - Management of balance sheet items or operations which, due to their nature, are not directly related to
any of the management areas referred to above; and
- ALM - Assets and Liabilities Management.
The definition of these areas allows for an effective management separation of the trading and banking books, as well
as for the correct allocation of each operation to the most suitable management area, according to its respective
context and strategy.
In order to ensure that the risk levels incurred in the different portfolios of the Group comply with the predefined
levels of tolerance to risk, various market risks limits are established, at least yearly, being applicable to all portfolios
of the risk management areas over which the risks are incident. These limits are monitored on a daily basis (or intra-
daily, in the case of financial markets) by the Risk Office.
Stop loss limits are also defined for the portfolios of the financial markets areas \u2013 Trading and Financing \u2013 based on
multiples of the risk limits defined for them, aiming to limit the maximum losses that may occur in these areas. If these
limits are reached, a review of the underlying business strategy and the assumptions relating to the management of the
positions in question is mandatory
Market risks of the prudential trading book (1)
For the daily measurement of general market risk - including interest rate risk, exchange rate risk, equity risk and price
risk of credit default swaps (indexes) - a VaR (value-at-risk) model is used, considering a time horizon of 10 business
days and a significance level of 99%.
The Group also uses another integrated market risk measure that allows monitoring of all risk sub-types considered
relevant. This measure integrates the assessment of generic risk, specific risk, non-linear risk and commodity risk. Each
of these sub-types of risk is measured individually, using an appropriate risk model, with the integrated measure
calculated from the measures for each one, without considering any type of diversification between the four sub-types
(worst approach case scenario).
For non-linear risk, an internally-developed methodology is applied, replicating the effect that the main non-linear
elements of options might have in P&L results of the different portfolios in which these are included, similarly to what
is considered by the VaR methodology, using the same time horizon and significance level.
Specific and commodity risks are measured through standard methodologies defined in the applicable regulations, with
an appropriate change of the time horizon considered.
The table below presents the amounts at risk for the Trading Book, as at 31 December 2022 and 2021, measured by the
methodologies referred to above:
(Thousands of euros)
2022
Max of global risk
in the period
Min of global risk
in the period
2021
Generic Risk ( VaR )
1,322
6,586
1,049
1,533
Interest Rate Risk
1,011
3,836
962
1,432
FX Risk
841
4,195
482
469
Equity Risk
585
36
589
274
Diversification effects
1,114
1,481
984
(642)
Specific Risk
13
37
15
35
Non-Linear Risk
\u2014
\u2014
\u2014
\u2014
Commodities Risk
\u2014
\u2014
\u2014
\u2014
Global Risk
1,335
6,623
1,064
1,568
In order to check the appropriateness of the internal VaR model to the assessment of the risks involved in the positions
held, several validations are conducted over time, of different scopes and frequency, which include back testing, the
estimation of the effects of diversification and the analysis of the comprehensiveness of the risk factors.
As a complement to the VaR assessment, the Group continuously tests a broad range of stress scenarios analysing the
respective results with a view to identifying risk concentrations that have not been captured by the VaR model.
Interest rate risk
The evaluation of interest rate risk derived from Banking Book operations is assessed through a process of risk
sensitivity analysis, undertaken every month, covering all the operations included in the Group's consolidated Balance
Sheet and discriminated by exposure currency.
Variations of market interest rates influence the Group's net interest income, both in the short term and medium/long
term, affecting its economic value in a long-term perspective. The main risk factors arise from the repricing mismatch
of portfolio positions (repricing risk) and from the risk of variation in market interest rates (yield curve risk). Besides
this, although with less impact, there is the risk of unequal variations in different reference rates with the same
repricing period (basis risk).
In order to identify the exposure of the Group's banking book to these risks, the monitoring of the interest rate risk
takes into consideration the financial characteristics of each of the relevant contracts, with the respective expected
cash-flows (principal and interest, without the spread component but including costs for liquidity, capital, operational
and other) being projected according to the repricing dates, thus calculating the impact on economic value resulting
from alternative scenarios of change of market interest rate curves.
The interest rate sensitivity of the balance sheet, by currency, is calculated as the difference between the present
value of the interest rate mismatch discounted at market interest rates and the discounted value of the same cash
flows simulating parallel shifts of the market interest rates.
(1) Trading Book - positions allocated to the Trading Management Area (and not specifically to the accounting trading book)
The following tables show the expected impact on the banking book economic value of parallel shifts of the yield curve
by +/- 100 and +/- 200 basis points, for each of the main currencies in which the Group holds material positions:
(Thousands of euros)
2022
Currency
-200 bp(*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
1,422
741
(763)
(1,544)
EUR
(99,549)
(50,069)
50,011
99,465
PLN
(71,253)
(35,436)
34,996
69,502
USD
(32,091)
(15,661)
14,937
29,193
(201,471)
(100,425)
99,181
196,616
are prepared in their functional currency and translated into Euros at the end of each financial period. The exchange
rates used for the conversion of balance sheet foreign currency amounts are the ECB reference rates at the end of each
period. In foreign currency conversion of results, are calculated average exchange rates according to the closing
exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
(Balance sheet)
(Income statement)
Currency
2022
2021
2022
2021
AOA
543.2680
632.4200
487.7116
747.0708
BRL
5.6390
6.3364
5.4153
6.3950
CHF
0.9872
1.0362
1.0042
1.0811
MOP
8.5744
9.1330
8.5744
9.1330
MZN
68.1850
72.9000
67.5585
77.9329
PLN
4.6816
4.5839
4.6823
4.5623
USD
1.0667
1.1373
1.0537
1.1833
Foreign exchange and equity risk of the banking book
The foreign exchange risk of the banking book is transferred internally to the Trading Area, in accordance with the risk
specialization model followed by the Group for the management of the balance sheet foreign exchange risk. The
structural foreign exchange exposures, namely those resulting from financial holdings in subsidiaries, are not included
in this transfer and are hedged through market operations, taking into consideration the defined strategy for managing
structural foreign exchange risk, whose objective is to hedge against the volatility in the CET1 ratio that stems from
changes in foreign currency exchange rates.
As at 31 December 2022, the Group 's financial investments in foreign currency were not hedged.
Whenever these hedges exist on a consolidated basis, are identified in accounting terms as net investment hedges, in
accordance with the IFRS nomenclature. On an individual basis, they are designated as fair value hedges of equity
investments.
The information on the gains and losses on instruments used to hedge net investments in foreign institutions are
recognized in foreign exchange reserves and presented in the statement of comprehensive income.
The transfer to Portugal of funds, including dividends, that are owed by BCP's subsidiaries or associates in third
countries, namely outside the European Union, may be subject to the restrictions and exchange controls that, at any
given time, are in force in the country in which the subsidiaries are constituted or associated.
In what concerns to the equity risk, the Group keeps a set of small-scale, low-risk positions, essentially in the
investment portfolio, namely resulting from execution/payment processes. The management of these positions is
carried out by a specialized area of the Group, with the respective risk being controlled through the metrics and limits
defined for controlling market risks.
Liquidity risk
The evaluation of the Group\u2019s liquidity risk is carried out using indicators defined by the supervisory authorities on a
regular basis and other internal metrics for which exposure limits are also defined.
The monitoring of the liquidity position of the Group's operations in short-term time horizons (up to 3 months) is based
on two internally defined indicators (immediate liquidity and quarterly liquidity). These indicators are calculated on a
daily basis, taking into account the impact in the liquidity buffers available to discount with the respective central
banks at the reference date of future estimated cash flows for each of the respective time horizon (3 days or 3 months)
considering the set of transactions intermediated by the market areas, including in this context transactions with
clients of the Corporate and Private networks, which, due to their size, must be quoted by the Trading Room. The
remaining buffer in each time bucket is then compared to the amount of customer deposits, being the indicators
assessed against exposure limits defined in the Bank's regulations.
In parallel, the evolution of the Group\u2019s structural liquidity position is calculated on a regular basis identifying all the
factors that justify the variations that occur. This analysis is submitted to the Capital and Assets and Liabilities
Committee (CALCO) for appraisal, to enable the decision making that leads to the maintenance of financing conditions
adequate to the continuation of the business.
The methodological aspects of the control of liquidity risk are a responsibility of the Risk Commission. This control
includes the regular execution of stress tests, to characterize the Bank's risk profile and to ensure that the Group and
each of its subsidiaries fulfil its obligations in the event of a liquidity crisis. These tests are also used to support the
liquidity contingency plan and management decisions.
In 2022, the liquidity positions of BCP, Bank Millennium and BIM reinforced their robustness, based mainly on the
growth of the respective customer deposit bases. This growth was particularly significant in the operation in Portugal,
in which it reached approximately 10%, mainly through the contribution of the retail depositors\u2019 segment. The main
source of financing for the operation in Portugal thus saw its stability reinforced, supporting, as in previous years, a
favourable evolution of the commercial gap.
Accordingly, the regulatory Liquidity Coverage Ratio (LCR), an indicator of short-term liquidity risk, stood at 212% on a
consolidated basis at the end of December 2022 (31 December 2021: 269%), well above the minimum regulatory
requirement of 100%, supported by portfolios of highly liquid assets whose value is compatible with a prudent liquidity
management by the Group.
The regulatory Net Stable Funding Ratio (NSFR), an indicator of structural liquidity risk, increased from 150% on 31
December 2021 to 154% on 31 December 2022, also above the regulatory minimum of 100%, mainly based on the growth
of the customer deposit portfolio.
The loan-to-deposit transformation ratio, another structural indicator of the RAS (calculated in accordance with Bank of
Portugal Instruction no 16/2004, in force), also evolved favourably from a liquidity risk perspective, from 81% on 31
December 2022 to 74% one year later.
It should be noted that, in the annual risk review for 2023, the internal limits for the RAS indicators remained
unchanged facing 2022.
Regarding the presence of the Bank in the debt segment of the capital market, it is worth highlighting the following
events, in chronological order: (i) in May, BCP repaid a covered bond issue in the amount of Euros 1,000,000,000. Given
the Bank's surplus position in terms of liquidity, there was no need to refinance the amount repaid in the market; (ii) in
October, the Bank placed its third issue of senior preferred debt on the market in a 3NC2 format (3 years maturity
callable after 2 years) in the amount of Euros 350,000,000. The operation was aimed at ensuring compliance with the
requirements of \u201cMREL\u201d (Minimum Requirements for Own Funds and Eligible Liabilities), namely the indicative target
that will be in force during 2023, from 1 January. This issue, with a coupon of 8.50% per annum (corresponding to a
spread of 554.7bps over mid-swaps) was carried out in very difficult market conditions, demonstrating the Bank's ability
to access the market even in an adverse and very complex environment; and (iii) in November, and considering that in
view of the prevailing market conditions the Bank had decided not to exercise, in December, the early repayment
option on a T2 issue of\u00a0 Euros 300,000,000, BCP launched an offer to exchange these securities not reimbursed, in the
ratio of 1:1, by others of the same nature, to be issued. Thus, given the non-exercise of the call-option, investors were
offered the option to exchange the bonds they held for newly issued securities with a higher coupon and longer term.
The amount of the new issue 10.25NC5.25 of T2 was set at Euros 133,700,000 and the coupon at 8.75%, per annum,
corresponding to a spread of 605.1bps over mid-swaps.
Still with regard to the funding structure, BCP repaid in advance in December 2022 the first tranche of the Targeted
longer term refinancing operation III (\u201cT LTRO III\u201d), contracted in June 2020 in the amount of Euros 7,550,070,000 (with
the second tranche, amounting to Euros 600,000,000, already repaid in January 2023). Considering the balance in
deposit at the Bank of Portugal and other available liquidity, BCP ended 2022 with a long position on the Eurosystem of
Euros 2,574,146,000.
Throughout 2022, the behaviour of the liquidity buffer at the ECB was mainly determined by the impacts, in opposite
directions, of the aforementioned favourable evolution of the commercial gap, on the one hand and, on the other
hand, of the growth of the margin calls related to derivatives and the decrease of the market price of the assets
eligible for discount with the Eurosystem, effects that showed a growing trend after the outbreak of war in Ukraine.
The combined effect of these and other factors of lesser materiality allowed, nevertheless, the buffer to grow Euros
2,749,283,000 on an annual basis, to Euros 26,520,745,000.
Likewise, in the year ended December 2022, Bank Millennium and BIM demonstrated the resilience of their liquidity
positions, supported by their retail deposit bases and robust buffers discountable at the respective central banks, with
regulatory and internal indicators of liquidity risk positioned comfortably above the comfort thresholds. In the case of
the operation in Poland, this occurred even considering the effects of the invasion of Ukraine, which resulted in the
significant devaluation of the eligible asset portfolio and the strengthening of derivatives\u2019 margin accounts.
The pool of eligible assets for funding operations in the European Central Bank and other central banks, after haircuts,
is detailed as follows:
(Thousands of euros)
2022
2021
European Central Bank
13,677,518
13,394,653
Other Central Banks
5,213,823
4,840,405
18,891,341
18,235,058
with possible situations of financial stress. The measures for its reinforcement are described in the Recovery Plan
which, at 31 December 2022, had a total estimated value for Portugal of Euros 3,750,000,000, arising from the sale of
corporate bonds and commercial paper, securitization of a portfolio of consumer credit and issuance of retained
covered bonds to be mobilized for the ECB's monetary policy pool.
In consolidated terms, the refinancing risk of medium and long-term instruments will remain at very low levels over the
next three years, with annual refinancing needs with no material expression.
Encumbered and Unencumbered assets
Within the scope of the European Banking Authority's guidance on the disclosure of encumbered assets and
unencumbered assets, taking into account the recommendation made by the European Systemic Risk Committee, the
following information is presented in accordance with Commission Implementing Regulation (EU) 2021/637 of 15 March
2021 supplementing Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to
regulatory technical standards for disclosure of encumbered and unencumbered assets.
(Thousands of euros)
2022 (1)
Carrying amount of
encumbered assets
Fair value of
encumbered assets
Carrying amount of
unencumbered assets
Fair value of
unencumbered assets
of which
notionally
eligible EHQLA
and HQLA (2)
of which
notionally
eligible EHQLA
and HQLA (2)
of which
EHQLA
and HQLA
(2)
of which
EHQLA
and HQLA
(2)
Assets of the disclosing
institution
13,756,969
1,091,650
82,775,892
25,254,479
Equity instruments
\u2014
\u2014
\u2014
\u2014
127,810
\u2014
127,810
\u2014
Debt securities
1,091,650
1,091,650
968,647
968,647
20,604,616
15,841,854
20,024,958
15,227,018
of which: securitisations
\u2014
\u2014
\u2014
\u2014
29,291
\u2014
24,793
\u2014
of which: issued by
general governments
1,052,101
1,052,101
930,126
930,126
15,452,215
14,962,526
14,877,737
14,391,677
of which: issued by
financial corporations
\u2014
\u2014
\u2014
\u2014
1,804,297
119,941
1,804,289
119,941
of which: issued by non-
financial corporations
39,560
39,560
38,521
38,521
2,754,650
541,928
2,754,901
541,928
Other assets
12,793,413
\u2014
61,561,554
8,879,947
(1)Table's figures are calculated by the median of the values disclosed in the regulatory information for the previous 4 quarters.
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Collateral received and own debt securities issued
(Thousands of euros)
2022 (1)
Fair value of encumbered collateral
received or own debt securities issued
Unencumbered
Fair value of collateral received or
own debt securities issued
available for encumbrance
of which notionally
eligible EHQLA and
HQLA (2)
of which EHQLA
and HQLA (2)
Collateral received by the disclosing institution
\u2014
\u2014
88,857
1,502
Debt securities
\u2014
\u2014
1,502
1,502
of which: issued by general governments
\u2014
\u2014
1,502
1,502
Loans and advances other than loans on demand
\u2014
\u2014
87,393
\u2014
Own covered bonds and securitisations issued
and not yet pledged
6,113,493
\u2014
TOTAL COLLATERAL RECEIVED AND OWN DEBT
SECURITIES ISSUED
13,756,969
1,091,650
(2)EHQLA (Set as Extremely High-Quality Liquid Assets) e HQLA (High-Quality Liquid Assets).
Sources of encumbrance
(Thousands of euros)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered
bonds and securitisations encumbered
Carrying amount of selected financial liabilities
10,520,000
13,256,892
At the end of 2022, and according to the EBA methodology, the total encumbered assets represents 14% of the Group's
total balance sheet assets. The encumbered Loans to customers represents 81% of the total encumbered assets, while
Debt securities represents 8%.
The encumbered assets are mostly related with the Portugal's activity funding operations, namely with the ECB,
securitisation programs and derivatives operations. The type of assets used as collateral for these financing transactions
are different Loans to Customers\u2019 portfolios, supporting securitisation programs and mortgage bonds, intended to
reinforce the collateral pool with the ECB. Regarding the collateralization of derivative operations, as well as financing
operations with the European Investment Bank, is mainly supported by sovereign debt eligible for central banks,
together with bonds issued by public sector companies.
On 31 December 2022, the Other assets includes unencumbered assets in the amount of Euros 8,477,357,000 related to
Loans on demand, the amount of Euros 56,201,560,000 related to Loans and advances other than loans on demand (of
which encumbered assets in the amount of Euros 11,188,611,000) and the amount of Euros 8,601,987,000, mostly
unencumbered and related to the Group\u2019s activity, namely, to: investments in associated companies and subsidiaries,
tangible assets and investment properties, intangible assets, assets associated with derivatives and current and
deferred taxes.
A 31 December 2022, the Group has a Euros 12.5 billion BCP Covered Bond Programme (\u201cBCP Programme\u201d) with Euros
9.2 billion of covered bonds outstanding. The BCP Programme is backed by a Euros 10.6 billion portfolio of residential
mortgages, providing an overcollateralization (\u201cOC\u201d) of 15.4%, which is above the minimum of 14% currently required
by rating agencies.
The Portuguese covered bond legislation affords covered bond holders a dual-recourse, firstly over the issuer, secondly
over the cover pool that may also include other eligible assets, over which they benefit from a special preferential
claim. The Portuguese covered bond legislation ensures total segregation of the covered pool from any future issuer\u2019s
insolvent estate, for the benefit of covered bond holders, who have precedence over claims of any other of the issuer\u2019s
creditors in case of issuer insolvency, thus and to this extent superseding the general insolvency and recovery
legislation. Residential mortgages in a cover pool are subject to certain eligibility criteria inscribed in the Portuguese
covered bond legislation, among them a maximum LTV of 80%, delinquency of no more than 90 days, and them being
first lien mortgages (or, if otherwise, all preceding liens being in the cover pool) over properties located in the EU. The
BCP\u2019s Programme documentation limits property location to Portugal only.
The analysis of the balance sheet items by maturity dates is as follows:
(Thousands of euros)
2022
Up to 3
months
3 months
to 1 year
1 year to 5
years
Over 5
years
Undetermined
maturity
At sight
Total
Assets
Cash and deposits at Central Banks
6,022,001
\u2014
\u2014
\u2014
\u2014
\u2014
6,022,001
Loans and advances to Credit
Institutions - Repayable on demand
213,460
\u2014
\u2014
\u2014
\u2014
\u2014
213,460
Other loans and advances (a)
\u2014
752,913
211,383
\u2014
\u2014
\u2014
964,296
Loans and advances to customers (a)
\u2014
\u2014
8,464,759
13,639,800
33,494,378
579,229
56,178,166
Other financial assets (b)
\u2014
777,004
1,371,845
5,090,680
1,049,378
491,922
8,780,829
6,235,461
1,529,917
10,047,987
18,730,480
34,543,756
1,071,151
72,158,752
Liabilities
Resources from Credit Institutions
\u2014
499,654
87,373
881,333
\u2014
\u2014
1,468,360
Resources from costumers
48,673,569
14,634,189
10,956,260
1,106,125
60,000
\u2014
75,430,143
Debt securities issued
\u2014
2,008
\u2014
852,706
627,372
\u2014
1,482,086
Subordinated debt
\u2014
\u2014
\u2014
314,519
1,018,537
\u2014
1,333,056
48,673,569
15,135,851
11,043,633
3,154,683
1,705,909
\u2014
79,713,645
(a)Gross of impairment
(b)Financial assets at fair value through profit or loss and Financial assets at fair value through other comprehensive income.
Operational Risk
The operational risk management system is framed by the \u201c3 Lines of Defence\u201d Corporate Governance model and is
based on an integrated structure of end-to-end processes, considering that a vision which is transversal to the
functional units of the organisational structure is the most suitable approach for the perception of risks and to estimate
the effects of the corrective measures introduced for their mitigation. Furthermore, these processes model also
underlies other strategic initiatives related to the management of this risk such as the actions to improve operating
efficiency and the management of business continuity. Hence, the most relevant Group subsidiaries have their own
process's structure, which is periodically adjusted according to business evolution, in order to ensure suitable coverage
of the business activities (or business support activities) developed, ensuring thus, the replication of the 3 Lines of
Defence model in the management of operational risk.
The responsibility for the day-to-day processes\u2019 management lies with the 1st Line of Defence: the process owners
(seconded by process managers), whose mission is to characterise the operational losses captured under their
processes, to monitor the respective Key Risk Indicators (KRI), to perform the Risks Self-Assessment (RSA) exercises, as
well as to identify and implement suitable actions to mitigate operational risk exposures, thus contributing to the
strengthening of control mechanisms and the improvement of the internal control environment. The periodic revision of
the main processes in each geography is ensured by local structure units.
The Risk Management function (materialised in the Risk Office) and the Compliance function (materialised in the
Compliance Office) represent the 2nd Line of Defence and are responsible for implementing the risk policy defined for
the Group, proposing and developing approaches for managing this risk, supervising their implementation and
challenging the 1st Line of Defence regarding the risk levels incurred. The Internal Audit function embodies the 3rd Line
of Defence and supervises the appropriate fulfilment of the functions and activities of the remaining two lines of
defence.
In 2022, the usual operational risk management activities continued to be executed by the various players involved in
the management of this risk, aiming at an efficient and systematic identification, evaluation, mitigation and control of
exposures, as well as at the appropriate reporting tasks, either to the Group\u2019s\u00a0 management bodies or within regulatory
duties. The results of the RSA exercises evidence a robust control environment, demonstrating the Group's commitment
to operational risk management through the continuous development of improvement actions that help mitigate
exposures to this risk. Regarding the operational losses registered, it should be highlighted that their pattern was not
different from what is usual and expected, with a higher frequency of losses of low amounts, without concentration in
significant amounts.
It should also be noted that the last 5-years average of the ratio between gross losses and the relevant indicator for TSA
(gross income) has consistently presented values below 1%, which compares favourably with international benchmarking
and attests the robustness of the operational control environment of the Group. The monitoring of KRI has allowed to
identify opportunities for improvement that, together with the RSA exercises and the process of identification and
registration of losses, provide for an effective management of this risk.
The Bank's mobilisation\u00a0to reinvent the banking experience, based on the digitization and use of new technologies,
entails relevant challenges in the management of operational risk, which include the reinforcement of the security of
digital banking channels, the reinforcement of mechanisms for the prevention and detection of potential fraud, proper
management of personal data and compliance with the information duties legally provided for in sales through digital
banking channels.
Covenants
The contractual terms of instruments of various wholesale funding instruments encompass obligations assumed by
entities belonging to the Group as borrowers or issuers, concerning general duties of corporate conduct, maintenance
of banking activity and the inexistence of special guarantees constituted for the benefit of other creditors (\u201cnegative
pledge\u201d). These terms essentially reflect the internationally adopted standards for each of the types of debt
instruments used by the Group.
The terms of the Group\u2019s participation in securitization operations involving its own assets are subject to mandatory
changes in case the Group stops respecting certain rating criteria. The criteria established in each transaction results
mainly from the existing risk analysis at the moment that the transaction was set, being these methodologies usually
applied by each rating agency in a standardised way to all the securitization transactions involving the same type of
assets.
Regarding the Covered Bond Programs of Banco Comercial Portugu\u00eas, there are no relevant covenants related to a
possible downgrade of BCP.
Hedge accounting
As at 31 December 2022, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2022
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
11,962,045
27,696
7,031
309,506
Foreign exchange risk
Currency and interest rate swap
431,257
2,999
18,432
(717)
12,393,302
30,695
25,463
308,789
Cash flows hedging
Interest rate risk
Interest rate swaps
14,559,138
\u2014
110,562
(1,513,397)
Foreign exchange risk
Currency and interest rate swap
1,273,663
29,008
41,975
(10,527)
15,832,801
29,008
152,537
(1,523,924)
Total
28,226,103
59,703
178,000
(1,215,135)
(A)Changes in fair value used to calculate the ineffectiveness of the hedge
As at 31 December 2021, the table below includes the detail of the hedging instruments used in the Group's hedging
strategies and accounted at the Balance sheet item - Hedging derivatives:
(Thousands of euros)
2021
Hedging instruments
Book value
Change in fair
value (A)
Type of hedging
Notional
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
15,464,986
74,261
28,509
127,033
Foreign exchange risk
Currency and interest rate swap
347,329
12,043
121
(29)
15,812,315
86,304
28,630
127,004
Cash flows hedging
Interest rate risk
Interest rate swaps
15,781,769
19,617
283,335
(324,922)
Foreign exchange risk
Currency and interest rate swap
1,691,525
3,138
65,008
(1,241)
17,473,294
22,755
348,343
(326,163)
Hedging of net investments in foreign entities
Foreign exchange risk
Currency and interest rate swap
153,427
\u2014
233
(1,045)
Total
33,439,036
109,059
377,206
(200,204)
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
As at 31 December 2021, the table below includes the detail of the hedged items:
(Thousands of euros)
2021
Hedged items
Type of hedging
Balance
sheet
item
Cumulative value of
the adjustments
Change
in fair
value (A)
Cash flow hedge reserve /
Currency translation reserve
Book value
Hedging
relationships
in effect
Hedging
relationships
discontinued
Assets
Liabilities
Assets
Liabilities
Fair value hedge
Interest rate risk
Interest rate swaps
(B)
745,328
\u2014
(1,678)
\u2014
(8,237)
n/a
n/a
(H)
4,133,227
\u2014
(12,706)
\u2014
(20,638)
n/a
n/a
(C)
6,574,692
\u2014
41,485
(2,013)
(117,932)
n/a
n/a
(D)
\u2014
10,000
\u2014
93
140
n/a
n/a
(E)
\u2014
12,350
\u2014
490
311
n/a
n/a
(F)
\u2014
497,998
\u2014
(985)
979
n/a
n/a
(G)
\u2014
758,076
\u2014
(4,530)
5,754
n/a
n/a
Foreign exchange risk
Currency and interest rate
swap
\u2014
347,329
\u2014
(66)
98
n/a
n/a
11,453,247
1,625,753
27,101
(7,011)
(139,525)
n/a
n/a
Cash flows hedging
Interest rate risk
Interest rate swaps
(B)
15,781,551
\u2014
\u2014
\u2014
324,922
(263,143)
131,353
Foreign exchange risk
Currency and interest rate
swap
(B)
1,691,525
\u2014
\u2014
\u2014
1,939
(9,567)
(285)
17,473,076
\u2014
\u2014
\u2014
326,861
(272,710)
131,068
Hedging of net investments
in foreign entities
Foreign exchange risk
- Bank Millennium, S.A.
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
\u2014
\u2014
\u2014
\u2014
1,045
55,326
\u2014
Total
28,926,323
1,625,753
27,101
(7,011)
188,381
(217,384)
131,068
(A)Fair value changes used to calculate the ineffectiveness of the hedge
(B)Financial assets at amortised cost - Loans and advances to customers
(C)Financial assets at fair value through other comprehensive income
(D)Financial liabilities at amortised cost - Resources from credit institutions
(E)Financial liabilities at amortised cost - Resources from customers
(F)Financial liabilities at amortised cost - Non subordinated debt securities issued
(G)Financial liabilities at amortised cost - Subordinated debt
(H)Debt securities held not associated with credit operations
The reconciliation of each equity component and an analysis of other comprehensive income attributable to hedge
accounting, with reference to 31 December 2022 and 2021, is as follows:
(Thousands of euros)
Cash flow hedge reserve
Exchange differences
2022
2021
2022
2021
Balance as at 1 January
(141,642)
262,288
55,326
56,371
Amounts recognised in other comprehensive income:
\u00a0 Hedging cash flows
\u00a0 \u00a0 Changes in fair value of currency and interest rate swaps
(1,523,207)
(326,958)
\u2014
\u2014
\u00a0 \u00a0 Foreign exchange changes
1,725
42
\u2014
\u2014
\u00a0 \u00a0 Hedge breakage
(123,938)
(75,565)
\u2014
\u2014
\u00a0 \u00a0 Ineffectiveness of coverage recognised in results
1,333
107
\u2014
\u2014
\u00a0 \u00a0 Others
(2,279)
(1,556)
\u2014
\u2014
\u00a0 Hedging of net investments - foreign exchange risk
\u00a0 \u00a0 Reclassified to the income statement
\u2014
\u2014
3,685
(1,045)
Change in the fair value of settled transactions
\u2014
\u2014
(59,011)
\u2014
Balance at the end of the year
(1,788,008)
(141,642)
\u2014
55,326
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2022:
(Thousands of euros)
2022
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiven
ess
recognised
in Income
statement
(A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(17,717)
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
362
\u2014
\u2014
\u2014
(17,355)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(66,333)
(238)
(E)
54,861
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(15,838)
(1,333)
\u2014
\u2014
(82,171)
(1,571)
54,861
\u2014
Total
(82,171)
(18,926)
54,861
\u2014
(A)Income Statement item in which the ineffectiveness of the hedge was recognised
(B)Income Statement item in which the reclassified amount was recognised
(C)but which are no longer expected to occur
(D)Net gains/(losses) from hedge accounting operations
(E)Interest income
(F)Net gains/(losses) from foreign exchange
The table below includes information on the effectiveness of hedging relationships, as well as impacts on results and
other comprehensive income, with reference to 31 December 2021:
(Thousands of euros)
2021
Income
statement
item (A)
Gains/(losses)
recognised in
Other
comprehensiv
e income
Hedging
ineffectiveness
recognised in
Income
statement (A)
Amounts reclassified from reserves to results
for the following reasons:
Income
statement
item (B)
Cash flows
that were
being hedged
(C)
Hedged item
with an
impact on
results
Type of hedging
Fair value hedge
Interest rate risk
Interest rate swaps
(D)
\u2014
(12,590)
\u2014
\u2014
Interest rate futures
(D)
\u2014
\u2014
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
\u2014
69
\u2014
\u2014
\u2014
(12,521)
\u2014
\u2014
Cash flows hedging
Interest rate risk
Interest rate swaps
(D)
(72,809)
(699)
(E)
68,038
\u2014
Foreign exchange risk
Currency and interest rate swap
(D)
(6,156)
(107)
\u2014
\u2014
(78,965)
(806)
68,038
\u2014
Hedging of net investments in
foreign entities
Foreign exchange risk
(F)
Currency and interest rate swap
(1,045)
\u2014
\u2014
\u2014
Total
(80,010)
(13,327)
68,038
\u2014
The table below shows the detail of hedging instruments, as at 31 December 2021, by maturity:
(Thousands of euros)
2021
Remaining period
Fair value
Type of hedging
Up to 3
months
3 months to 1
year
Over 1
year
Total
Assets
Liabilities
Fair value hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
Notional
342,503
1,076,631
14,045,852
15,464,986
74,261
28,509
Fixed interest rate (average)
1.54%
0.57%
0.25%
0.30%
Fair value hedging derivatives
related to currency risk changes
OTC Market:
Currency and interest rate swap
171,466
175,863
\u2014
347,329
12,043
121
Cash flow hedging derivatives related to
interest rate risk changes:
OTC Market:
Interest rate swaps
\u2014
174,524
15,607,245
15,781,769
19,617
283,335
Cash flow hedging derivatives related to
currency risk changes:
OTC Market:
Currency and interest rate swap
210,017
160,365
1,321,143
1,691,525
3,138
65,008
Hedging derivatives related to
net investment in foreign operations:
OTC Market:
Currency and interest rate swap
153,427
\u2014
\u2014
153,427
\u2014
233
Total derivatives traded by
OTC Market:
877,413
1,587,383
30,974,240
33,439,036
109,059
377,206
their impacts occurs by means of the \u201ctraditional\u201d categories: credit risk, market risk, operational & reputation risk,
liquidity and financing risks.
Within this context, and with the purpose of promoting the integration of ESG factors in risk management, the Bank
implemented a set of processes and methodologies to identify, assess, manage and monitor the impact of the ESG
category in overall risk, in accordance with the framework and policies already established for the remaining financial
and non-financial risks.
Governance Model
The governance model for risks arising from ESG factors follows a structure based on three lines of defence which,
under the leadership of the Board of Directors (and respective delegations on the Executive Committee), ensure its
adequate assessment and management.
The first-line functions comprise all the departments and business areas that interact with the Bank\u2019s customers,
counterparties and suppliers, collect the information and data that support the assessment of their risk profiles (and of
their respective operations) and structure the commercial solutions with characteristics associated with the ESG or with
the promotion of control of their impacts on the Bank's risk profile.
Between the first and second lines of defence, the role of the Sustainability Function is established, whose
responsibilities include a) the overall management of the sustainability strategy and plans of Millennium BCP and of its
financial group; b) the direct orientation and operational support to the first and second lines of defence in the
performance of their main responsibilities; c) the development of policies, methodologies and reports that address ESG
issues; and d) the management of commitments and external communications by the Bank and the Group in this area.
In the second line of defence, the responsibility for risk control, is assumed by the Risk Office and by the Compliance
Office. These functions ensure the procedures for the design, implementation of the policies/methodologies/ risk
management models, which are paramount in keeping the risk profile of the Group in appropriate levels.
Among other, these responsibilities, include:
\u2022Integrate the ESG dimension in risk appetite (Risk Appetite Framework - RAF);
\u2022Develop and maintain the methodologies necessary for risk assessment and management;
\u2022Carry out stress tests focused on climate and environmental risk factors;
\u2022Introduce the ESG dimension in capital and liquidity adequacy exercises;
Specifically in terms of compliance, we emphasise the following controls:
\u2022Compliance with regulations relating to sustainability and risk management arising from ESG factors;
\u2022Quality in the external reporting and disclosure of information;
\u2022Design and labelling of the commercial and investment products;
\u2022Incorporation of ESG related requirements and conditions in the Bank\u2019s contracts;
\u2022Prevention of conflicts of interest in the provision of services and products related with ESG.
The third line of defence assumes responsibility for the independent review of all ESG aspects through the annual work
plans of the Internal Audit Function.
Identification of ESG risks
Climate changes and environmental degradation factors are elements that potentially affect economic activity. These
alterations may include factors related with issues such as climate changes (mitigation, and adaptation), sustainable
use and protection of hybrid and marine resources, transition towards a circular economy, prevention and control of
pollution, protection and restoration of biodiversity.
The materialisation of these risks fundamentally stems from the exposure of Millennium BCP's banking portfolio to
customers, counterparties and invested assets whose performance may be affected or contribute to the negative
impacts of climate change and other environmental factors.
These factors may generate negative financial impacts which are identified and assessed by means of two main
dimensions:
\u2022Physical risks: arising from the physical effects of climate change and environmental degradation. They should be
categorized as a) severe risks, if they arise from extreme weather events such as fires, floods or droughts; b) chronic
risks, if they arise from progressive changes in weather and climate patterns or from a gradual loss of natural
ecosystems.
\u2022Transition risks: are the risks of any negative financial impact arising from the effort, in progress or to happen in the
future, of transition into a low-carbon and environmentally sustainable economy. These may result, for example,
from technological changes, the impact of public policies or behavioural changes in terms of demand for goods or
services (including banking services).
The materialisation of social risks is also assessed, considering the issues related with rights, well-being and interests of
persons and communities and include factors such as (in)equality, health, diversity, inclusion, labour relations,
workplace health and safety, human capital and communities.
In addition, the governance risk factors are also identified by Millennium BCP, through issues relating to leadership,
management and prevention of conflicts of interest, quality of internal control and independent reviews/auditing,
transparency and good tax practices, for example.
A methodology for assessing the materiality of ESG risks was developed in order to determine the potential impact of
those risks on the Bank\u2019s profile.
Management and monitoring principles
ESG risks management and respective strategy follows a different logic compared to 'traditional' risks, which are based
on short-term timeframes. In contrast, the materialization of ESG risks is expected to occur over extended timeframes,
which is why the establishment of strategy and risk appetite follows different timeframes. For example, if the
assessment of physical (severe) risks can determine an action strategy more focused on the short term (e.g.,
considering the establishment of additional mitigation measures, at the level of policies for granting credit and
insurance policy), the transition risks justify a more structural approach, based on collecting information, evaluating
customers and monitoring their performance over time.
From this perspective, Millennium BCP's management of ESG impacts follows the following principles:
\u2022Establishment of a responsible corporate financing policy, which excludes or conditions the Group's operations in
sectors and/or activities with greater environmental and social impact.
\u2022Integration of the strategy for managing risks arising from ESG factors into the Bank's global sustainability plan, which
steers the integration of the ESG dimension into business processes, establishing goals, timelines and a model for
controlling proper observance.
\u2022Transparent communication: the Bank publicly discloses its sustainability and ESG impact management goals and key
practices, allowing all stakeholders to evaluate the robustness of its approach, including its exposure to ESG risks.
\u2022Regular monitoring of exposure to risks arising from ESG factors through the management information routines
already established for each of the risk categories.
\u2022Internal standardisation of ESG references, through a corporate taxonomy that allows the identification and
classification of the exposures that are proven to have characteristics that promote the transition of the Portuguese
and European economy.
\u2022Focus on credit risk management, through models that promote the integration of the ESG dimension in the risk
assessment of the Bank's main companies/customers, ensuring that business decisions include an assessment of the
main impacts of ESG factors.
\u2022Information gathering and structuring, using public sources and information provided directly by customers, as a
means of improving knowledge of customers' environmental performance and the possible financial impacts
associated with any limitation on this performance.
The implementation of these principles, in turn, is promoted through an internal policy of management of the risks
arising from ESG factors, which establishes the following main risk tools:
\u2022Regular assessment of the materiality of the risks arising from ESG factors that allows confirming the alignment with
the risk appetite and the need to implement mitigation actions;
\u2022Risk assessment methodologies arising from ESG factors integrated in the credit risk assessment models;
\u2022Risk classification methodologies at portfolio level, enabling the identification of sectors, companies and exposures
more susceptible to transition and/or physical risks;
\u2022Quantification models for financed GHG emissions, promoting strategic discussion regarding the management of these
emissions and their alignment (in time) with the Paris Agreement targets;
\u2022Sensitivity analyses and stress tests focusing on climate risks.
Stress testing with a focus on climate risk
The Bank uses methodologies for analysing sensitivity and conducting stress tests to the risks arising from ESG factors
(with a focus on the climate risk component).
Considering the ESG risk materialisation horizons, this is an important risk management technique, which allows
assessing the impacts of climate change (and respective scenarios) on the financial variables that affect the value of
Millennium BCP's banking portfolio.
Based on its results, new risk exposures may be identified that require the Bank to take additional management
measures to mitigate the impacts of climate risks.
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialRiskManagementExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-703": { "value": "
The collaterals and the relevant guarantees can be aggregated in the following categories:
- financial collaterals, real estate collaterals or other collaterals;
- receivables;
- first demand guarantees, issued by banks or other entities with Risk Grade 7 or better on the Rating Master Scale;
- personal guarantees when the persons are classified with Risk Grade 7 or better;
- credit derivatives. \u00a0
The financial collaterals accepted are those that are traded in a recognised stock exchange, i.e., on an organized
secondary market, liquid and transparent, with public bid-ask prices, located in countries of the European Union,
United Kingdom, United States, Japan, Canada, Hong Kong or Switzerland.
In this context, it is important to refer that the Bank\u2019s shares are not accepted as financial collaterals of new credit
operations and are only accepted for the reinforcement of guarantees of existing credit operations, or in restructuring
process associated to credit recoveries.
An internal level of protection is attributed to all credit operations at the moment of the credit granting decision,
considering the credit amount as well as the value and type of the collaterals involved. The protection level
corresponds to the loss reduction in case of default that is linked to the various collateral types, considering their
market value and the amount of the associated exposure.
In the case of financial collaterals, adjustments are made to the protection value by the use of a set of haircuts, in
order to reflect the price volatility of the financial instruments.", "dimensions": { "concept": "ifrs-full:DescriptionOfAccountingPolicyForCollateralExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-704": { "value": "
The maximum exposure to credit risk of financial assets not subject to impairment requirements is analysed as follows:
(Thousands of euros)
2022
2021
Financial assets held for trading (note 24)
Debt instruments
338,813
452,105
Derivatives
394,183
468,642
Financial assets not held for trading mandatorily at fair value through profit or loss
Debt instruments (note 24)
504,200
881,556
Hedging derivatives (note 25)
59,703
147,570
Total
1,296,899
1,949,873
- In the case of financial assets, excluding derivatives, it is considered that its credit risk exposure is equal to its book value;
- In the case of derivatives, the maximum exposure to credit risk is its market value, plus its potential risk (\"add-on\").
", "dimensions": { "concept": "ifrs-full:DisclosureOfFinancialAssetsHeldForTradingExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-705": { "value": "
Market risk
Market risks consist of the potential losses that might occur in a given portfolio as a result of changes in interest or
exchange rates and/or in the prices of the different financial instruments of the portfolio, considering not only the
correlations that exist between those instruments but also their volatility.
For purposes of profitability analysis and market risks quantification and control, the following management areas are
defined for each entity of the Group:
- Trading - Management of positions whose objective is the achievement of short-term gains, through sale or
revaluation. These positions are actively managed, tradable without restriction and may be valued frequently and
accurately. The positions in question include securities and derivatives of sales activities;
- Funding - Management of institutional funding (wholesale funding) and money market positions;
\u2013Investment - Management of all the positions in securities to be held to maturity (or for a longer period of time) or
positions which are not tradable on liquid markets;
- Commercial - Management of positions arising from commercial activity with Customers;
- Structural - Management of balance sheet items or operations which, due to their nature, are not directly related to
any of the management areas referred to above; and
- ALM - Assets and Liabilities Management.
The definition of these areas allows for an effective management separation of the trading and banking books, as well
as for the correct allocation of each operation to the most suitable management area, according to its respective
context and strategy.
In order to ensure that the risk levels incurred in the different portfolios of the Group comply with the predefined
levels of tolerance to risk, various market risks limits are established, at least yearly, being applicable to all portfolios
of the risk management areas over which the risks are incident. These limits are monitored on a daily basis (or intra-
daily, in the case of financial markets) by the Risk Office.
Stop loss limits are also defined for the portfolios of the financial markets areas \u2013 Trading and Financing \u2013 based on
multiples of the risk limits defined for them, aiming to limit the maximum losses that may occur in these areas. If these
limits are reached, a review of the underlying business strategy and the assumptions relating to the management of the
positions in question is mandatory
Market risks of the prudential trading book (1)
For the daily measurement of general market risk - including interest rate risk, exchange rate risk, equity risk and price
risk of credit default swaps (indexes) - a VaR (value-at-risk) model is used, considering a time horizon of 10 business
days and a significance level of 99%.
The Group also uses another integrated market risk measure that allows monitoring of all risk sub-types considered
relevant. This measure integrates the assessment of generic risk, specific risk, non-linear risk and commodity risk. Each
of these sub-types of risk is measured individually, using an appropriate risk model, with the integrated measure
calculated from the measures for each one, without considering any type of diversification between the four sub-types
(worst approach case scenario).
For non-linear risk, an internally-developed methodology is applied, replicating the effect that the main non-linear
elements of options might have in P&L results of the different portfolios in which these are included, similarly to what
is considered by the VaR methodology, using the same time horizon and significance level.
Specific and commodity risks are measured through standard methodologies defined in the applicable regulations, with
an appropriate change of the time horizon considered.
The table below presents the amounts at risk for the Trading Book, as at 31 December 2022 and 2021, measured by the
methodologies referred to above:
(Thousands of euros)
2022
Max of global risk
in the period
Min of global risk
in the period
2021
Generic Risk ( VaR )
1,322
6,586
1,049
1,533
Interest Rate Risk
1,011
3,836
962
1,432
FX Risk
841
4,195
482
469
Equity Risk
585
36
589
274
Diversification effects
1,114
1,481
984
(642)
Specific Risk
13
37
15
35
Non-Linear Risk
\u2014
\u2014
\u2014
\u2014
Commodities Risk
\u2014
\u2014
\u2014
\u2014
Global Risk
1,335
6,623
1,064
1,568
In order to check the appropriateness of the internal VaR model to the assessment of the risks involved in the positions
held, several validations are conducted over time, of different scopes and frequency, which include back testing, the
estimation of the effects of diversification and the analysis of the comprehensiveness of the risk factors.
As a complement to the VaR assessment, the Group continuously tests a broad range of stress scenarios analysing the
respective results with a view to identifying risk concentrations that have not been captured by the VaR model.
Interest rate risk
The evaluation of interest rate risk derived from Banking Book operations is assessed through a process of risk
sensitivity analysis, undertaken every month, covering all the operations included in the Group's consolidated Balance
Sheet and discriminated by exposure currency.
Variations of market interest rates influence the Group's net interest income, both in the short term and medium/long
term, affecting its economic value in a long-term perspective. The main risk factors arise from the repricing mismatch
of portfolio positions (repricing risk) and from the risk of variation in market interest rates (yield curve risk). Besides
this, although with less impact, there is the risk of unequal variations in different reference rates with the same
repricing period (basis risk).
In order to identify the exposure of the Group's banking book to these risks, the monitoring of the interest rate risk
takes into consideration the financial characteristics of each of the relevant contracts, with the respective expected
cash-flows (principal and interest, without the spread component but including costs for liquidity, capital, operational
and other) being projected according to the repricing dates, thus calculating the impact on economic value resulting
from alternative scenarios of change of market interest rate curves.
The interest rate sensitivity of the balance sheet, by currency, is calculated as the difference between the present
value of the interest rate mismatch discounted at market interest rates and the discounted value of the same cash
flows simulating parallel shifts of the market interest rates.
(1) Trading Book - positions allocated to the Trading Management Area (and not specifically to the accounting trading book)
The following tables show the expected impact on the banking book economic value of parallel shifts of the yield curve
by +/- 100 and +/- 200 basis points, for each of the main currencies in which the Group holds material positions:
(Thousands of euros)
2022
Currency
-200 bp(*)
- 100 bp (*)
+ 100 bp
+ 200 bp
CHF
1,422
741
(763)
(1,544)
EUR
(99,549)
(50,069)
50,011
99,465
PLN
(71,253)
(35,436)
34,996
69,502
USD
(32,091)
(15,661)
14,937
29,193
(201,471)
(100,425)
99,181
196,616
are prepared in their functional currency and translated into Euros at the end of each financial period. The exchange
rates used for the conversion of balance sheet foreign currency amounts are the ECB reference rates at the end of each
period. In foreign currency conversion of results, are calculated average exchange rates according to the closing
exchange rates of each month of the year. The rates used by the Group are as follows:
Closing exchange rates
Average exchange rates
(Balance sheet)
(Income statement)
Currency
2022
2021
2022
2021
AOA
543.2680
632.4200
487.7116
747.0708
BRL
5.6390
6.3364
5.4153
6.3950
CHF
0.9872
1.0362
1.0042
1.0811
MOP
8.5744
9.1330
8.5744
9.1330
MZN
68.1850
72.9000
67.5585
77.9329
PLN
4.6816
4.5839
4.6823
4.5623
USD
1.0667
1.1373
1.0537
1.1833
", "dimensions": { "concept": "ifrs-full:DisclosureOfMarketRiskExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-706": { "value": "
Sources of encumbrance
(Thousands of euros)
Sources of encumbrance
Matching liabilities, contingent
liabilities and securities lent
Assets, collateral received and own debt
securities issued other than covered
bonds and securitisations encumbered
Carrying amount of selected financial liabilities
10,520,000
13,256,892
to rule on those nullities raised by them, having refused to prohibit the use during the judgment of electronic messages
seized, allowing witnesses to be confronted with their content. The requesting banks lodged an appeal against this
order, which was admitted by the Lisbon Court of Appeal.
On 28 April 2022, TCRS (\"Tribunal da Concorr\u00eancia, Regula\u00e7\u00e3o e Supervis\u00e3o\") handed down a decision under the scope
of Proc. 225/15.4YUSTR-W, regarding the appeal to challenge the decision of the Portuguese Competition Authority of
September 2019 (PRC/2012/09), which imposed fines on a number of banking institutions for alleged violation of
competition rules in virtue of participating in a process of exchanging information on mortgage loans, consumer credit
and credit to SMEs.
In this extensive decision, TCRS lists the facts given as proven, bearing in mind the testimonial evidence produced and
the documents attached to the case file, both in the administrative phase and in the trial, however, at this stage, the
TCRS does not yet conclude by the legal framework of the facts as proven, nor, consequently, by the imposition of
fines, having the TCRS instead chosen to make the reference for a preliminary ruling to the Court of Justice of the
European Union (CJEU) in order to answer two preliminary questions that it sets out, requesting that this reference
follows further terms in the form of an accelerated procedure, taking into account the risk of prescription. It should be
noted that it is not up to the CJEU to adjudicate on the case, but only to interpret the rules of community law by
answering in abstract to the questions submitted to it by the referring court.
CJEU rejected TCRS's request for an accelerated procedure and for priority to be given in the assessment of this case,
hence CJEU's assessment must be given within the normal deadline for these prejudicial proceedings, after which the
judgment of this Court will then be concluded.
The Bank has been notified by the CJEU to, if it wishes, submit its written observations, and must do so by 2 September
2022.
The Bank forwarded its observations to the CJEU on 1 September 2022.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and Jos\u00e9
Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo Banco, S.A.
and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the defendant
banks and the financial system, without which they would have sold the pledged shares and paid their loans. If this is
not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to Funda\u00e7\u00e3o Jos\u00e9 Berardo
for damages caused by breach of contract, since the moment when they should have been sold in execution of the
pledge due to failure to verify coverage ratios until the moment\u00a0 when they were sold, that is, the difference between
the price at which the pledged shares would have been sold on the dates of coverage ratios default and the price at
which they were actually sold, plus interest and all other loan charges since those dates, in any case the global amount
of compensation not being less than Euros 800,000,000. In any case, the plaintiffs ask the defendant banks to be jointly
condemned to pay Jos\u00e9 Manuel Rodrigues Berardo compensation for moral damages, in the already calculated amount
of Euros 100,000,000 and also in the amount that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of Ministers,
published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9 Berardo, was
declared extinct.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
3. On 3 January 2018, Bank Millennium received decision of the Chairman of the Office for Protection of Competition
and Consumers (OPCC), in which the OPCC Chairman found infringement by Bank Millennium of the rights of consumers.
In the opinion of the OPCC Chairman the essence of the violation is that Bank Millennium informed consumers (it
regards 78 agreements) in responses to their complaints, that the court verdict stating the abusiveness of the provisions
of the loan agreement regarding exchange rates does not apply to them. According to the position of the OPCC
Chairman the abusiveness of contract\u2019s clauses determined by the court\u00a0 in the course of abstract control is
constitutive and effective for every contract from the beginning. As a result of the decision, Bank Millennium was
obliged to:
1) send information on the UOKiK\u2019s decision to the said 78 clients;
2) place the information on\u00a0 decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (Euros 4.42 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium appealed
against the judgment within the statutory deadline. The court presented the view that the judgment issued in the
course of the control of a contractual template (in the course of an abstract control), recognizing the provisions of the
template as abusive, determines the abusiveness of similar provisions in previously concluded contracts. Therefore, the
information provided to consumers was incorrect and misleading. As regards the penalty imposed by OPCC, the court
pointed out that the policy of imposing penalties by the Office had changed in the direction of tightening penalties and
that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the perspective
of today's case-law views on the importance of abstract control (it was not until January 2016 that the Supreme Court's
resolution supporting the view of the OPCC Chairman was published), the more penalties for these behaviours should
not be imposed using current policy. The above constitutes a significant argument against the validity of the judgment
and supports the appeal which Bank Millennium submitted to the Court of second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is positive.
Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC Chairman
recognized the practice of participating banks, including Bank Millennium, in an agreement aimed at jointly setting
interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of competition, and
by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2 million (Euros 2.61
million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection. Bank Millennium has created a provision in the amount equal to the imposed penalty.
4. On 22 September 2020, Bank Millennium received decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman) recognising clauses stipulating principles of currency exchange applied in
the so-called anti-spread annex as abusive and prohibited the use thereof.
Penalty was imposed upon Bank Millennium in the amount of PLN 10.5 million (Euros 2.24 million). Penalty amount
takes account of two mitigating circumstances: cooperation with the Office for Protection of Competition and
Consumers and discontinuation of the use of provisions in question.
Bank Millennium was also requested, after the decision becomes final and binding, to inform consumers, by registered
mail, to the effect that the said clauses were deemed to be abusive and therefore not binding upon them (without need
to obtain court\u2019s decision confirming this circumstance) and publish the decision of the case on Bank Millennium\u2019s
website.
In the decision justification delivered in writing the OPCC Chairman stated that FX rates determined by Bank Millennium
were determined at Bank Millennium\u2019s discretion (on the basis of a concept, not specified in any regulations, of average
inter-bank market rate). Moreover, client had no precise knowledge on where to look for said rates since provision
referred to Reuters, without precisely defining the relevant site.
Provisions relating to FX rates in Bank Millennium\u2019s tables were challenged since Bank Millennium failed to define when
and how many times a day these tables were prepared and published.
In justification of the decision, the OPCC Chairman also indicated that in the course of the proceeding, Bank Millennium
presented various proposed solutions, which the OPCC Chairman deemed to be insufficient.
The decision is not final and binding. Bank Millennium appealed against the said decision within statutory term.
On 31 March 2022, the first instance court revoked the entire decision of the Chairman of the OPCC. On 23 May 2022,
the Chairman of the OPCC filed an appeal. On 26 October 2022, the Court of Appeal changed the judgment of the court
of first instance and shared the position of the Chairman of the OPCC as to the abusiveness of the provisions regarding
the determination of exchange rates in the annexes concluded with foreign currency borrowers. On 21 November 2022,
the Court of Appeal, at the request of Bank Millennium, suspended the execution of the judgment until the end of the
cassation proceedings. Bank Millennium filled a cassation appeal to the Supreme Court.
5. As at 31 December 2022, the most important proceedings, in the group of the court cases where the Group\u2019s
companies are defendant, are following:
- Bank Millennium is a defendant in three court proceedings in which the subject of the dispute is the amount of the
interchange fee. In two of the abovementioned cases, Bank Millennium was sued jointly and severally with another
bank, and in one with another bank and card organizations. The total value of claims submitted in these cases is PLN
729.6 million (Euros 155.84 million). The proceedings with the highest value of the submitted claim are brought by PKN
Orlen SA, in which the plaintiff demands payment of PLN 635.7 million (Euros 135.79 million). The plaintiff in this
proceeding alleges that the banks acted under an agreement restricting competition on the acquiring services market
by jointly setting the level of the national interchange fee in the years 2006-2014. In the other two cases, the charges
are similar to those raised in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated
for the years 2008-2014. According to current estimates of the risk of losing a dispute in these matters, Bank Millennium
did not create a provision. In addition, we point out that Bank Millennium participates as a side intervener in four other
proceedings regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks
of acting as part of an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2008-2014.
- A lawsuit brought up by Europejska Fundacja Wsp\u00f3\u0142pracy Polsko-Belgijskiej/European Foundation for Polish-Belgian
Cooperation (EFWP-B) against Bank Millennium S.A., worth of the dispute PLN 521.9 million (Euros 111.48 million) with
statutory interest from 5 April 2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the
Regional Court in Warsaw; the suit\u00a0 was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis
for the claim is damage to their assets, due to the actions taken by Bank Millennium and consisting in the wrong
interpretation of the Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which
resulted in placing the loan on demand. In the case brought by EFWP-B, the plaintiff moved for securing the claim in
the amount of PLN 250.0 million (Euros 53.40 million). The petition was dismissed on 5 September 2016 with legal
validity by the Appellate Court. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with
the charges raised in the claim. Supporting the position of Bank Millennium, Bank Millennium\u2019s attorney submitted a
binding copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state
in the action brought by PCZ SA against Bank Millennium. At present, the Court of first instance is conducting evidence
proceedings.
As at 31 December 2022, the total value of the subjects of the other litigations in which the Group\u2019s companies\u00a0
appeared as defendant, stood at PLN 3,876.4 million (Euros 828.01 million) (excluding the class actions described below
and in note 57). In this group the most important category are cases related with FX loans mortgage portfolio and cases
related to forward transactions (option cases).
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors (454
borrowers party to 275 loan agreements) is represented by the Municipal Consumer Ombudsman in Olsztyn. The
plaintiffs demanded payment of the amount of PLN 3.5 million (Euros 0.75 million), claiming that the clauses of the
agreements, pertaining to the low down payment insurance, are unfair and thus not binding. Plaintiff extended the
group in the court letter filed on 4 April 2018, therefore the claims increased from PLN 3.5 million (Euros 0.75 million)
to over PLN 5 million (Euros 1.07 million).
Actual status:
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings and
submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The value of
the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (Euros 1,574,484.78).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff and
decided to take witness evidence in writing and called on the parties to submit questions to the witnesses. Bank
Millennium submitted a pleading with questions to witnesses in July 2020. Currently, the court is collecting written
testimony from witnesses. The date of the hearing has not been set at the moment.
As at 31 December 2022, there were also 218 individual court cases regarding LTV (loans-to-value) insurance (cases in
which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial Ombudsman, in
the lawsuit, demands that Bank Millennium and the Insurer (TU Europa) be ordered to discontinue performing unfair
market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its website, information on use of
unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts. Nonetheless, if
the practice is deemed to be abusive it may constitute grounds for future claims to be filed by individual clients.
The case is being examined by the court of first instance.
8. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to Euros 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -, filed
against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they acted
pursuant to a request made by the Bank for the making of the respective purchases, and also that the court orders the
cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due to
relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs and to
refund them the cost they incurred while complying with that mandate, namely, Euros 90,483,816.83 regarding Banco
Esp\u00edrito Santo, S.A. (BES) and Euros 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD), plus default
interests;
d) the amount of the lawsuit determined by the plaintiffs is Euros 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff company
in the amount of Euros 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report was submitted. There is a deadline for completing and concluding
the expert report, in its final version, since the Bank presented a complaint about various aspects of the expert's
report, in its first version.
9. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal applied a
resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the Decree-law no.
298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial transfer of
assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo Banco, S.A. (Novo
Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope of this process, the
Resolution Fund made a capital contribution to Novo Banco amounting to Euros 4,900 million, becoming, on that date,
the sole shareholder. Further, in accordance with information published on the Resolution Fund\u2019s website, the
Resolution Fund borrowed Euros 4,600 million, of which Euros 3,900 million were granted by the Portuguese State and
Euros 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities emerging from
the \u201ceventual negative effects of future decisions regarding the resolution process that may result in liabilities or
contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken, following
the publication of the report on the result of the independent evaluation, made to estimate the level of credit recovery
for each category of creditors under a hypothetical scenario of a normal insolvency process of BES on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would hypothetically
take if BES had gone into liquidation right before the application of the resolution measure, such creditors shall be
entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the total
acknowledged credits, including capital, remunerative and default interest amounts to Euros 5,056,814,588, of which
Euros 2,221,549,499 are common credits and Euros 2,835,265,089 are subordinated claims, and no guaranteed or
privileged claims exist. Both the total number of acknowledged creditors and the total value of the acknowledged
credits and their ranking will only be ultimately determined upon the definitive judicial judgment of the verification
and ranking of credits to be given in the liquidation proceedings.
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed and is
underway. According to note 20 of the Resolution Fund\u2019s annual report of 2021, \u201cLegal actions related to the
application of resolution measures have no legal precedents, which makes it impossible to use case law in its
evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026) The Resolution
Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and procedural
information available so far, considers that there is no evidence to cast doubt on their belief that the probability of
success is higher than the probability of failure\u201d.
According to note 22 of the Resolution Fund\u2019s annual report of 2021, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction. (...) Regarding litigation in the
Spanish jurisdiction, during the years 2018 to 2021, ten (decisions) have become final and unappealable condemning
Novo Banco, Spanish branch, as well as three sentences in relation to which due compensation has been requested
from the Resolution Fund\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco de
Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently signed
the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a total of Euros
1,000 million in Novo Banco, of which Euros 750 million at completion and Euros 250 million within a period of up to 3
years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco and the Resolution
Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the performance
of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
If these conditions are met, the Resolution Fund may be called upon to make a payment to Novo Banco for the lesser of
the accumulated losses in the covered assets and the amount necessary to restore the capital ratios at the agreed
levels. Any capital injections to be carried out pursuant to this contingent mechanism are limited to an absolute cap.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align incentives as
well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers no. 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new shareholder
of Euros 750 million, followed by a further capital increase of Euros 250 million by the end of 2017. Upon completion of
the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the purposes of the
resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding the
approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support measures by the
Resolution Fund and the Portuguese State that are part of the sale agreement associated with a total gross book value
of around Euros [10-20] billion(1) that revealed significant uncertainties regarding adequacy in provisioning(2):
(i)Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding costs,
realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a maximum of
Euros 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some additional
conditions(1)(2)(3);
(ii)underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount necessary
(but no more than Euros 400 million). The amount that can be reclaimed by the Resolution Fund under the CCA is
subject to the cap of Euros 3.89 billion(2);
(iii) in case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted by the
Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism (capital
backstop), up to Euros 1.6 billion, provided for in the commitments made by the Portuguese State to ensure the
viability of NB, exists\u201d.
According to Novo Banco\u2019s earnings presentation of December 2022, Novo Banco still has Euros 485 million under the
MCC in addition to the Euros 209 million included in the capital call for 2021. The mechanism is in place until December
2025, date that can be extended, under certain conditions, by one additional year.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has disclosed that
the European Commission intends to consider the restructuring process of Novo Banco as completed. The information
disclosed today confirms the successful restructuring of Novo Banco, resulting from the combined execution of the
restructuring plan agreed in 2017, under the sale transaction conducted by Banco de Portugal, and the sale
agreements, namely the CCA, under which the Resolution Fund transferred to Novo Banco 485 million euros, less than
the maximum amount set in the contract (3,890 million euros). The completion of the restructuring of Novo Banco, in
which the Resolution Fund maintains a 19.31% stake, is also another indicator that Novo Banco should not need to
request any further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that
still may occur regarding the amounts already requested by Novo Banco in relation to past years and that the Resolution
Fund considers that are not due. In the statement issued by Banco de Portugal on the same day, it is also disclosed that
\"The conclusion of the Novo Banco restructuring process also results in the end of the backstop mechanism, which
provided for the possibility, which was always considered remote, of the Portuguese State providing extraordinary
support to Novo Banco in extreme scenarios. This mechanism protected Novo Banco and the national financial system
from more adverse scenarios, which did not materialize. With the end of the backstop, the financial risk for the
Portuguese State is eliminated\".
According to the 2018 Resolution Fund\u2019s annual report, the Resolution Fund and Novo Banco have agreed that a
Verification Agent - an independent entity which is essentially responsible for clarifying any differences that may exist
between Novo Banco and the Resolution Fund regarding the set of calculations inherent to the CCA or regarding the
practical application of the principles stipulated in the contract - is in charge of confirming that the perimeter of the
mechanism is correct and that the balance sheet values of Novo Banco are being correctly reflected in the mechanism,
as well as verifying the underlying set of calculations, namely by confirming the correct calculation of losses and the
reference value of the assets. According to the 2021 Resolution Fund\u2019s annual report, the Resolution Fund follows the
work carried out by the Verification Agent, while specific analyses are being requested.
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or
Tier 1 SREP requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
In its 2021 annual report, the Resolution Fund states that \u201ceventual new requests regarding future periods, with
significant uncertainty regarding the relevant parameters for the calculation of eventual responsibilities, under the
terms of the CCA, are recorded as contingent liabilities\u201d.
The Resolution Fund disclosed on 17 June 2019 a set of clarifications related to the payment due in 2019 under the CCA
with Novo Banco, namely:
- For payments from the Resolution Fund to be made (limited to a maximum of Euros 3,890 million over the lifetime of
the mechanism), losses on the assets under the contingent mechanism should be incurred and the capital ratios of Novo
Banco should stand below the agreed reference thresholds;
- The payment to be made by the Resolution Fund corresponds to the lower of the accumulated losses on the assets
covered and the amount necessary to restore the capital ratios above the minimum reference threshold;
- The reference capital ratios are, in 2017, 2018 and 2019, linked to the regulatory requirements applicable to Novo
Banco (CET1 ratio of 11.25% and Tier 1 ratio of 12.75%), but, as from 2020, the reference ratio will correspond to a
CET1 ratio of 12%;
- The initial reference value of the portfolio comprising the CCA was, as of 30 June 2016, Euros 7,838 million (book
value of the associated assets, net of impairments);
- The value of the portfolio, as at 31 December 2021, amounted to Euros 1.8 billion (book value, net of impairments),
according to Novo Banco\u2019s First Half 2022 report.
According to a notice issued by the Resolution Fund on 4 June 2020, the \"Resolution Fund and Novo Banco have
initiated an arbitration procedure to clarify the treatment that should be given, under the CCA, of the effects of Novo
Banco\u2019s decision to waive the transitional regime it currently benefits from and which aims to reduce the impact of
the introduction of IFRS 9 on credit institutions' own funds. This issue falls within the scope of the implementation of
the CCA, which sets the maximum amount of payments to be made by the Resolution Fund at Euro 3,890 million. Thus,
even if the arbitration procedure were to have an unfavourable outcome for the Resolution Fund's claims, its effects
would fall under the maximum limit of Euros 3,890 million in accordance with the CCA. The above arbitral proceedings
therefore do not represent an additional risk compared to the ceiling of Euros 3,890 million\".
According to Resolution Fund\u2019s annual report of 2021 (Box 1), \"the award of the Arbitration Court, constituted under
the aegis of the International Chamber of Commerce, was known at the end of October 2021, and was favorable to the
Resolution Fund. The Arbitration Court considered that (...) the financial impact on Novo Banco's own funds could not
be covered by the CCM. The value of the dispute at the date of the award amounted to 169 million euros, an amount
that the Resolution Fund would have had to pay to Novo Banco if the Arbitration Court's award had not been
favorable\".
Additionally, regarding the intervention of the Resolution Fund concerning the transitional regime of the
implementation of the dynamic component of IFRS 9, Novo Banco estimates a positive impact on its own funds in the
amount of Euros 171 million (which implies a reduction in the capital requirements that Novo Banco intended to pass on
to the CCM in the amount of Euros 161.6 million). Accordingly, the Resolution Fund initiated a second arbitration
proceeding, also under the aegis of the International Chamber of Commerce, with a view to settling the difference
between the parties. This process is in progress, and it is estimated that an award will be rendered during 2023.
According to a statement by the Resolution Fund on 3 September 2020, following the payment made in May 2019 by the
Resolution Fund to Novo Banco in compliance with the CCA, a special audit determined by the Government was carried
out. Information was presented by the independent entity that carried out the special audit, showing that Novo Banco
has been operating with a strong influence of the vast legacy of non-productive assets, originated in BES, which
resulted in impairment charges and provisions, but have also contributed to rendering Novo Banco\u2019s internal procedures
more robust. Regarding the exercise of the powers of the Resolution Fund under the CCA, the audit results reflect the
adequacy of the principles and the adopted criteria.
According to Resolution Fund\u2019s annual report of 2021, the procedure relating to the payment to Novo Banco regarding
2020 accounts has been concluded, concluding that a payment of Euros 112 million was due to Novo Banco from the
Resolution Fund which had remained pending further verification. Therefore, that amount was paid to Novo Banco, in
December 2021, after the conclusion of the supplementary analysis promoted by the Resolution Fund. This amount,
according to a statement issued by the Resolution Fund on 23 December 2021, was already provisioned, included in the
total amount of the provision (Euros 429,012,629).
According to Resolution Fund\u2019s annual report of 2021, Novo Banco submitted to the International Chamber of
Commerce a request for arbitration to have recognized the right to receive an aggregate amount of Euros 165,441.9
thousand (divestment of Novo Banco's activity in Spain in the amount of Euros 147,441.9 thousand and valuation
differences regarding a set of assets held by Novo Banco in the amount of Euros 18,000 thousand) which the Resolution
Fund considered, and considers, not to merit the coverage of the CCM.
According to Novo Banco\u2019s First Half 2022 report (note 30), Novo Banco adhered to the Special Regime applicable to
Deferred Tax Assets under Law No. 61/2014, of 26 August, according to which, the deferred tax assets recorded until 31
December 2015 can be converted into tax credits when the taxable entity reports an annual net loss, in accordance to
the proportion of the amount of the said net loss to total equity at the individual company level, A special reserve was
established with an amount identical to the tax credit approved, increased by 10%. The conversion rights are securities
that entitle the State to require Novo Banco to increase its share capital by incorporating the amount of the special
reserve and consequently issuing and delivering free of charge ordinary shares. The shareholders have the right to
acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2021 annual report, under the terms of the sale of Novo Banco, the 75% of the share
capital of Novo Banco held by Nani Holdings is not affected by the dilution associated with the Special Regime
applicable to deferred tax assets (REIAD).
According to Resolution Fund\u2019s annual report of 2021, on 17 December 2021, Novo Banco, carried out a capital increase
in the amount of Euros 154,907.3 thousand, through the conversion of the rights that had been attributed to the State
due to the conversion of the deferred tax assets of Novo Banco, into tax credits, with reference to the 2015 tax period,
under the REIAD. As of that date, the State became a shareholder of Novo Banco, having been attributed a participation
corresponding to 1.56% of the share capital. As a result, the participation of the Resolution Fund was diluted from 25%
to 23.44%.
According to Novo Banco\u2019s announcement of 4 November 2022, the share capital increase arising from the conversion of
conversion rights relating to 2016 and 2017 fiscal years issued under the REAID increased the Portuguese State
shareholding to 5.69% and Lone Star kept the 75% share capital of Novo Banco. Only the participation of the Resolution
Fund will be diluted, concomitantly.
Also, according to the Resolution Fund\u2019s 2021 annual report, it is estimated that the aggregate effect of the application
of the REAID will result in the reduction of the participation of the Resolution Fund to 9.05%.
On 3 May 2021, following the request of the Portuguese parliament in October 2020 to review the operations and
management of Novo Banco that led to the need to transfer funds from the Resolution Fund to Novo Banco, the
Resolution Fund announced that the audit report conducted by Tribunal de Contas (\u201cCourt of Auditors\u201d) was released.
The Court of Auditors concluded that the public financing of Novo Banco through the CCA contributed to the stability of
the financial system, particularly as it avoided the bank\u2019s liquidation and reduced systemic risk. According to the
Resolution Fund, the audit does not identify any impediment to the fulfilment of commitments and contracts arising
from BES\u2019s resolution process, initiated in August 2014.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to fail\u201d
and started an urgent resolution process of the institution through the partial or total sale of its activity, which was
completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and obligations of
Banif, formed by the assets, liabilities, off-balance sheet items and assets under management.
The largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of Euros 746 million. The Resolution Fund provided a
guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of which Euros 489
million were provided by the Resolution Fund, which was funded by a loan granted by the State.
According to Oitante's press release on 12 January 2022, \"during 2021, it repaid Euros 160.5 million related to its bond
loan of Euros 746 million, contracted when it was created on 20 December 2015 due to the resolution of Banif\". On 4
July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds issued in
connection with the resolution of BANIF. Oitante's debt, which initially amounted to Euros 746 million, was thus fully
repaid. With the early repayment of the debt, the Resolution Fund's responsibility as guarantor also ceases, as well as
the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the non-
acknowledged creditors. According to the Resolution Fund\u2019s 2021 annual report, the Resolution Fund holds a claim on
Banif of Euros 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF. Under the
judicial liquidation process of Banif, which was initiated following the resolution, the independent evaluator estimates
that the level of recovery of the financial support made available by the Resolution Fund, as having a higher ranking at
the end of the liquidation, should be 7.6%.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal dismissed a
lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de Portugal. In its
decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and assumed other
responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2021, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (Euros 3,900 million); (ii) to finance the absorption of Banif's losses (Euros 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (Euros 430 million plus Euros 850 million of additional funding requested in 2019 and Euros 850
million made available in 2020);
- Other funding granted:
\u2022in 2014 by the institutions participating in the Resolution Fund in the amount of Euros 700 million, in which the
Bank participates, within the scope of BES resolution measure;
\u2022in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up to a
maximum of EUR 429 million;
- Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of Euros 400
million. This underwriting did not take place as the instruments were placed with third party investors as disclosed by
Novo Banco on 29 July 2018;
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a loss
greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralized by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, totally reimbursed, as described above.
- CCA allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions related to the
aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star up to Euros 3.89
billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1 below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the SREP
total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
According to Resolution Fund\u2019s annual report of 2021, contingent liabilities from the CCA are limited to a maximum
aggregate amount of Euros 3,890 million and that the aggregate amount of this contingent liability, which corresponds
to the difference between that maximum amount and the amounts already paid by the Resolution Fund, amounts to
Euros 485 million.
The expectation of the Resolution Fund is that, except for what may eventually result from the pending arbitration
disputes with Novo Banco, no further payments will occur under the CCA. On the other hand, the value of payments
already made may be compensated, under the terms of the contracts, by the eventual recovery of credits that may
occur, to which the value of the shareholding of the Resolution Fund in Novo Banco must be added.
According to note 20 of the Resolution Fund\u2019s 2021 annual report, the Resolution Fund considers that, to date, there
are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the Euros 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution Fund, the
extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet its obligations
through its regular revenues, regardless of the contingencies to which the Resolution Fund is exposed. On the same day,
the Office of the Minister of Finance also announced that increases in the liabilities arising from the materialization of
future contingencies will determine the maturity adjustment of State and bank loans to the Resolution Fund, required
from to maintain the contributory effort required from the banking sector at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco Esp\u00edrito
Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to Euros 4,953
million, of which Euros 4,253 million were granted by the Portuguese State and Euros 700 million were granted by a
group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on the
use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and financial
balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on regular
revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and released on 12
July 2022, \"the repayment of the Euros 2,130 million loans granted by the Portuguese State to the Resolution Fund will
not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or in 2059 (with the use of
the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid in 2062\u201d.
According to a statement issued by the Resolution Fund on 31 December 2021, the Euros 700 million loan to the
Resolution Fund was provided by seven credit institutions (Caixa Geral de Dep\u00f3sitos, Banco Comercial Portugu\u00eas, Banco
BPI, Banco Santander Totta, Caixa Econ\u00f3mica, Montepio Geral, Banco BIC Portugu\u00eas and Caixa Central de Cr\u00e9dito
Agr\u00edcola M\u00fatuo).
On 2 October 2017, by Resolution no. 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to make
available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary, to satisfy
any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-mentioned
resolution further set out that the framework agreement should be subject to a time period that is consistent with the
undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to satisfy said obligations in
due time.
On 31 December 2021, the Resolution Fund's own resources had a negative equity of Euros 7,207.6 million, as opposed
to Euros 7,314.7 million at the end of 2020, according to the latest 2021 annual report of the Resolution Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives proceeds
from the initial and regular contributions from the participating institutions (including the Bank) and from the
contribution over the banking sector (created under Law no. 55-A/2010). It is also provided for the possibility of the
member of the Government responsible for the area of Finance to determine, by ordinance that the participating
institutions make special contributions, in the situations provided for in the applicable legislation, particularly if the
Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law no. 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying, since
2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the occurrence of
the event which creates the obligation to pay the contribution, i.e. on the last day of April of each year, as stipulated
in Article 9 of the referred Decree-Law no. 24/2013, of 19 February, thus the Bank is recognising as an expense the
contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law no. 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 19/2022, published on 15 December 2022, set the base rate for 2023 for the
determination of periodic contributions to the Resolution Fund at 0.029% (0.057% in 2022).
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is not
expected that the Resolution Fund will propose the setting up of a special contribution to finance the resolution
measure applied to BES. Therefore, the potential collection of a special contribution appears to be unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in the
amount of Euros 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to partially
cover for the disbursements made by the RF in respect of resolution measures prior to the date of application of this
Agreement. This amount will have to be reinstated over a period of 8 years (started in 2016) through the periodic
contributions to the SRF. The Single Resolution Fund does not cover undergoing situations with the National Resolution
Fund as at 31 December 2015. The total amount of the contribution attributable to the Group in the financial year of
2022 was Euros 30,400 thousand, of which the Group delivered Euros 25,847 thousand and the remaining was
constituted as irrevocable payment commitment.
During the financial year of 2022, the Group made regular contributions to the Portuguese Resolution Fund in the
amount of Euros 18,668 thousand. The amount related to the contribution on the banking sector in Portugal, registered
in the financial year of 2022, was Euros 43,484 thousand. These contributions were recognized as a cost in the financial
year of 2022, in accordance with IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, to assess the effects on the Resolution Fund due to: (i) the sale of the shareholding in
Novo Banco in accordance with the communication of Banco de Portugal dated 18 October 2017 and the information
provided by the European Commission on this subject under the terms described above, including the effects of the
application of the Contingent Capital Agreement and the Special Regime applicable to Deferred Tax Assets; (ii) the
application of the principle that no creditor of the credit institution under resolution may take on a loss greater than
the one it would take if that institution did not go into liquidation; (iii) additional liabilities or contingencies for Novo
Banco which need to be neutralized by the Resolution Fund; and, (iv) legal proceedings against the Resolution Fund.
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order no. 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a proposal
with respect to the determination of amounts, time limits, payment methods, and any other terms related to the
special contributions to be made by the institutions participating in the Resolution Fund. According to public
communications from both the Resolution Fund and from the Government, there is no indication that any such special
contributions are foreseen.
According to the Resolution Fund\u2019s 2021 annual report, under note 8, \"the Resolution Fund is not obliged to present
positive equity. In case of insufficient resources, the Resolution Fund may receive special contributions, as determined
by the member of the Government responsible for finance, in accordance with article 153-I of the Banking Act,
although no such contributions are expected, in particular after a review of the financing conditions of the Resolution
Fund\", as described in the 2016 Annual Report. The Resolution Fund may also, exceptionally, obtain financial support
from the State, namely through loans or guarantees, as set out in article 153-J of the same regime.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the General
Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding its approval
of the CCA of Novo Banco.
According to Resolution no. 63-A/2021 of 27 May 2021 of the Council of Ministers, a number of national financial
institutions offered to finance the Resolution Fund, under conditions considered as appropriate by it, increasing up to
Euros 475 million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund. The funding costs of the Resolution Fund (from the State and from banks) will continue to be
exclusively borne by periodic revenues, corresponding to the contributions paid by the banking sector. The payment
obligations arising from this loan benefit from a pari passu treatment with the payment obligations of the loans entered
into with the Portuguese State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on
28 August 2014.
According to the Resolution Fund\u2019s 2021 annual report, the payment to Novo Banco was fully funded with resources
from a loan from seven domestic credit institutions, including BCP, to finance payments that are due under the
aforementioned contingent capitalization mechanism, up to a maximum amount of Euros 475 million. Of this amount,
the Resolution Fund used Euros 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period between the
contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be reviewed on 31
December 2026 and, after that, every five-years.
The budgetary amendment necessary to make the payment by the Resolution Fund was authorised by Order of the
Minister of State and Finance dated 31 May 2021.
10. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution adopted
by Bank of Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation adopted by
the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent capitalization
agreement under which the Resolution Fund commits to inject capital in Novo Banco up to Euros 3,9 billion, under
determined circumstances. In the proceedings, the claimants request the declaration of nullity or annulment of those
acts.
The proceedings were filed based on the information contained in the Communication from Bank of Portugal dated 31
March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September 2017. Bank
of Portugal and the Resolution Fund presented their arguments and, only very recently, Nani Holdings SGPS, S.A. did
the same since, by delay of the court, this company was only very recently notified to act as a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Bank of Portugal cannot be challenged and (iii) the material incompetence of the
court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an opponent
party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the opponent
party. After the presentation of the arguments, Bank of Portugal attached to the proceedings what it called an
evidence process (allegedly in compliance with the law) but most of the documents delivered were truncated in such a
way that neither the court nor the claimants are able to obtain adequate knowledge thereof. That issue was already
raised in the proceedings (requesting the court to order Bank of Portugal to deliver a true evidence process) but no
decision thereon has been made yet.
Currently, the proceedings are prepared for confirmation of the decision accepting the formalities of the right of action
(with the making of a decision on the specific objections invoked). In case the judge considers that Novo Banco is an
opponent party, the judge must start by issuing a pre-confirmation in order to request the claimants to identify it.
Afterwards, that Bank will be notified to present its opposition arguments.
The case was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal opinions to
the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
11. Following the restructuring process agreed with the Directorate-General for Competition (DGComp) and the
Portuguese State, Group Banco Comercial Portugu\u00eas implemented a process of salary adjustment for a temporary
period. Additionally, it was agreed between the Bank and the Unions that, in the years after the State intervention and
if there are distributable profits, the Board of Directors and the Executive Committee would submit for approval of the
Shareholders\u2019 General Meeting a proposal of distribution of profits to the employees, which allows the distribution of an
accumulated total global amount at least equal to the total amount that was not received over the temporary term of
the salary adjustment, as described in the clause no. 151-E of BCP\u2019s Collective Labour Agreement, effective between
2014 and 2017.
At the General Meeting of 4 May 2022, following the proposal submitted by the Board of Directors, the application of
profits relating to the financial year of 2021 was approved, which included an extraordinary distribution to each
employee up to Euros 5,692,000, and the concrete determination of the amount to be attributed to each employee
must be fixed by the Executive Committee to employees who, having not already been fully compensated with the
results distributed in 2019 and 2020, remain in office on the date of payment of the remuneration corresponding to
June 2022.
12. The Bank was subject to tax inspections for the years up to 2019. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the case of
indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of determining
the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/corrections made by the tax
administration were the object of contestation by administrative and/or judicial means.
The Bank recorded provisions or deferred tax liabilities at the amount considered sufficient to offset the tax or tax loss
carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by the tax administration.
", "dimensions": { "concept": "ifrs-full:DisclosureOfContingentLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-708": { "value": "Contingent liabilities and other commitments
In accordance with accounting policy 1.U3, the main contingent liabilities and other commitments under IAS 37 are the
following:
1. In 2012, the Portuguese Competition Authority (\"PCA\") initiated an administrative proceeding relating to competition
restrictive practices (no. PRC 2012/9). On 6 March 2013, unannounced inspections were conducted in the premises of
Banco Comercial Portugu\u00eas, S.A. (\"BCP\" or \"Bank\") and other credit institutions, where documentation was seized to
investigate allegations of a commercially sensitive information exchange between Portuguese banks.
The administrative proceeding was subject to judicial secrecy by the PCA, as the publicity of the process would not be
compatible with the interests of the investigation and with the rights of the investigated companies. On 2 June 2015,
the Bank was notified of the PCA\u2019s statement of objections (\u201cSO\u201d) in connection with the administrative offence no.
2012/9, by which the Bank is accused of participating in a commercially sensitive information exchange between other
fourteen banks related to retail credit products, namely housing, consumer and small and medium enterprises credit
products.
The proceedings, including the deadline to submit a response to the SO, were suspended for several months between
2015 and 2017, following the appeals lodged by some defendants (including the Bank) before the Portuguese
Competition, Regulation and Supervision Court (\u201cCompetition Court\u201d) on procedural grounds (namely, on the right to
have access to confidential documents which were not used as evidence by the Authority \u2013 for several months, the PCA
denied the Defendant\u2019 right to have access to confidential documents not used as evidence). In the end of June 2017,
the suspension on the deadline to reply to the SO was lifted.
On 27 September 2017, BCP submitted its reply to the statement of objections. A non-confidential version of the Bank\u2019s
defense was sent to the PCA, at the latter\u2019s request, on 30 October 2017. The witnesses indicated by the Bank were
interrogated by the PCA in December 2017 (although without the presence of BCP\u2019s legal representatives).
In May 2018, the PCA refused the BCP\u2019s application for confidential treatment of some of the information in the Bank\u2019s
reply to the SO, having also imposed that the Bank protects the confidential information of the co-defendants
(providing a summary of the information). On 1 June 2018, the Bank filed an appeal with the Competition Court, which,
upholding the appeal, concluded that the PCA infringed on the right to a prior hearing. Complying with the judgment,
in November 2018, the PCA notified the Bank of its intention to deny the application for confidential treatment of some
of the information included in the Bank\u2019s defence; subsequently, in January 2019, it requested BCP to provide
summaries for the co-defendants\u2019 confidential information. The Bank filed an appeal before the Competition Court,
which ruled in favor of BCP, as it considered that the elaboration by the Bank of summaries for its co-defendants\u2019
confidential information an illegitimate burden.
In April 2019, at the PCA\u2019s request, BCP declared to be in favor of the re-examination of its witnesses, requested in its
defense and previously held. The witnesses were re-inquired on 16-17 April 2019 with the presence of the Bank\u2019s legal
representatives.
The PCA denied the request of BCP to be allowed to conduct cross-examination of the witnesses appointed by its co-
defendants. The Bank appealed to the Competition Court, which denied the appeal, through a decision which was latter
upheld by the Lisbon Court of Appeal. BCP then lodged an appeal before the Portuguese Constitutional Court for breach
of the constitutional right of defence. The Constitutional Court dismissed the appeal on 29 April 2021, on the grounds
that the requested cross-examination was not required by the Portuguese Constitution, at that stage of the
proceedings. On 12 August 2020, the Bank lodged a complaint before the European Court of Human Rights on this
matter.
On 2 July 2019, the Bank submitted its observations to the PCA\u2019s report on complementary evidence measures.
On 3 June 2019, BCP was notified of the partial dismissal of the complementary evidence measures it had requested in
its reply to the SO, which it judicially contested. By judgment of September 2019, the Competition Court declared the
nullity of the PCA\u2019s decision, for breach of the right of the parties to be heard on the PCA\u2019s draft decision. The Bank
appealed to the Lisbon Court of Appeal in what concerned the limitation by the Competition Court of the effects of the
nullity declaration of the PCA\u2019s decision. Although this appeal was ultimately admitted by the panel of judges of the
Lisbon Court of Appeal, it ends up being denied.
In order to give compliance to BCP\u2019s right to be heard, the PCA notified the BCP of its intention to reject the above-
mentioned complementary evidence measures. Following BCP\u2019s observations in November 2019, the PCA adopted its
final decision rejecting the measures, which was judicially contested by the BCP in December 2019. In March 2020, the
Competition Court rejected the appeal. This judgment was upheld by the Lisbon Court of Appeal in October 2020.
On 9 September 2019, the PCA adopted its final decision in this proceeding, fining the Bank in a Euros 60 million fine
for its alleged participation in an information exchange system with its competitors in the housing, consumer and SME
credit segments. The BCP considers that the Decision contains serious factual and legal errors, having, on 21 October
2019, filed an appeal before the Competition Court requesting the annulation of the Decision and the suspensory effect
of the appeal. On 8 May 2020, BCP\u2019s appeal was admitted. On 8 June 2020, the BCP submitted a request before the
Court, claiming that the rule according to which appeals do not have, in principle, suspensory effect violates the
Portuguese Constitution, submitting elements aimed at demonstrating considerable harm in the advance provisional
payment of the fine, and offering a guarantee in lieu (indicating the respective percentage of the fine to be offered as
a guarantee). On 14 December 2020, a hearing was held before the Competition Court, and a consensual solution was
reached between the PCA and the defendant banks, including BCP, as to the dosimetry (i.e., 50% of the amount of the
fine) and the forms of the guarantee to be provided, in order for the appeal of the PCA\u2019s decision to have suspensory
effect. On 21 December 2020, BCP submitted a bank guarantee issued by the BCP, which was accepted by the
Competition Court. On 1 March 2021, the Competition Court notified BCP that the guarantee had been presented in a
timely manner and in the agreed form, and, as a result, attributed suspensory effect to the appeal. By order of 20
March 2021, the Competition Court lifted the judicial secrecy and informed the appellants that the trial would, in
principle, start in September 2021.
On 9 July 2020, the BCP requested the Court to declare the nullity of the fining decision of the PCA for failure to assess
the economic and legal context, as determined by the recent case-law of the Court of Justice of the European Union.
The Competition Court clarified that this and other prior questions would not be assessed before the hearing phase.
On 13 January 2021, BCP was notified of an application submitted by \"Associa\u00e7\u00e3o Ius Omnibus \u2013 Nova Associa\u00e7\u00e3o de
Consumidores\" to the Competition Court asking it to have access to a non-confidential version of the file, based on the
need to assert the \u201crights to indemnification of the consumers whose rights and interests it represents, and the possible
exercise and proof of those rights in the context of an action for damages\u201d. On the same date, BCP was notified by the
Competition Court of its decision authorizing the news agency \"Lusa\" to access the file of the administrative phase of
the case. BCP appeal of this decision to the Appeal Court of Lisbon, on 25 January 2021 and opposed to the request of
\"Ius Omnibus\" on 2 February 2021.
On 20 March 2021, the Competition Court determined: (i) the lifting of the judicial secrecy; (ii) the forwarding to the
Public Prosecutor of the appeal of BCP against the decision of the Competition Court relating to \"Lusa\", for reply; (iii)
the provisional start date of the judgement hearing on September 2021, having requested suggestions by the co-
appellants for venues.
By decision of 9 April 2021 of the Competition Court, a preparatory hearing took place on 30 April 2021 for discussion of
issues precedent to the begging of the judgment hearings, in which the procedures relating to the treatment of
confidential information of the co-appellants in the appeals was defined, as well as the conditions relating to access to
file. The Competition Court also set forth preliminary dates for the judgement hearing and scheduled a preparatory
hearing for 7 July 2021.
On 28 June 2021, BCP was notified by the Competition Court to reply to the requests submitted by some of the co-
appellants and confirm that all confidential information had been duly eliminated from non-confidential versions
submitted by each co-appellant. The Competition Court also determined that the hearing of 7 July 2021 was cancelled
and its object would be transferred to the next hearing date (6 September 2021).
On 8 July 2021, BCP presented its reply to the notification of 28 June 2021, having also requested confirmation in
relation to the scheduling of the judgement hearing, namely confirmation of whether it was actually scheduled for 6
September 2021 the preparatory hearing and the start of the judgement hearing sessions.
Several representatives of the banks raised the question of the possible unconstitutionality of the seizure proceedings
of e-mail messages used as evidence in the PCA\u2019s decision, which objection appeal will now take place. This issue was
raised bearing in mind the recent Decision of the Constitutional Court no. 687/2021 on the administrative offence case
no. 225/15.4YUSTR-W. A petition on this matter was filed with the Court on 10 October 2021, requesting the Court to
take a position on the matter before the beginning of the trial. The Court issued an order rejecting the banks' request
to rule on those nullities raised by them, having refused to prohibit the use during the judgment of electronic messages
seized, allowing witnesses to be confronted with their content. The requesting banks lodged an appeal against this
order, which was admitted by the Lisbon Court of Appeal.
On 28 April 2022, TCRS (\"Tribunal da Concorr\u00eancia, Regula\u00e7\u00e3o e Supervis\u00e3o\") handed down a decision under the scope
of Proc. 225/15.4YUSTR-W, regarding the appeal to challenge the decision of the Portuguese Competition Authority of
September 2019 (PRC/2012/09), which imposed fines on a number of banking institutions for alleged violation of
competition rules in virtue of participating in a process of exchanging information on mortgage loans, consumer credit
and credit to SMEs.
In this extensive decision, TCRS lists the facts given as proven, bearing in mind the testimonial evidence produced and
the documents attached to the case file, both in the administrative phase and in the trial, however, at this stage, the
TCRS does not yet conclude by the legal framework of the facts as proven, nor, consequently, by the imposition of
fines, having the TCRS instead chosen to make the reference for a preliminary ruling to the Court of Justice of the
European Union (CJEU) in order to answer two preliminary questions that it sets out, requesting that this reference
follows further terms in the form of an accelerated procedure, taking into account the risk of prescription. It should be
noted that it is not up to the CJEU to adjudicate on the case, but only to interpret the rules of community law by
answering in abstract to the questions submitted to it by the referring court.
CJEU rejected TCRS's request for an accelerated procedure and for priority to be given in the assessment of this case,
hence CJEU's assessment must be given within the normal deadline for these prejudicial proceedings, after which the
judgment of this Court will then be concluded.
The Bank has been notified by the CJEU to, if it wishes, submit its written observations, and must do so by 2 September
2022.
The Bank forwarded its observations to the CJEU on 1 September 2022.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
2. On 7 June 2022, the Bank was notified by the Court to contest a lawsuit brought by Funda\u00e7\u00e3o Jos\u00e9 Berardo and Jos\u00e9
Manuel Rodrigues Berardo against Banco Comercial Portugu\u00eas, S.A., Caixa Geral de Dep\u00f3sitos, S.A., Novo Banco, S.A.
and Banco Esp\u00edrito Santo, S.A., in liquidation.
In this lawsuit, the Plaintiffs allege that they incurred in a mistake regarding the endogenous situation of the defendant
banks and the financial system, without which they would have sold the pledged shares and paid their loans. If this is
not the case, the plaintiffs request the defendant banks to be ordered to pay compensation to Funda\u00e7\u00e3o Jos\u00e9 Berardo
for damages caused by breach of contract, since the moment when they should have been sold in execution of the
pledge due to failure to verify coverage ratios until the moment\u00a0 when they were sold, that is, the difference between
the price at which the pledged shares would have been sold on the dates of coverage ratios default and the price at
which they were actually sold, plus interest and all other loan charges since those dates, in any case the global amount
of compensation not being less than Euros 800,000,000. In any case, the plaintiffs ask the defendant banks to be jointly
condemned to pay Jos\u00e9 Manuel Rodrigues Berardo compensation for moral damages, in the already calculated amount
of Euros 100,000,000 and also in the amount that is settled as soon as the full extent of the damages is known.
In the meantime, through Order No. 8765/2022 of Mr. Secretary of State for the Presidency of the Council of Ministers,
published in Republic Diary, Series 2, part C, of 19 July 2022, the Plaintiff of this lawsuit, Funda\u00e7\u00e3o Jos\u00e9 Berardo, was
declared extinct.
The lawsuit was contested on 27 September 2022 and is awaiting subsequent terms.
The Bank does not anticipate that this lawsuit may result in any responsibility that could have impact on the respective
financial statements.
3. On 3 January 2018, Bank Millennium received decision of the Chairman of the Office for Protection of Competition
and Consumers (OPCC), in which the OPCC Chairman found infringement by Bank Millennium of the rights of consumers.
In the opinion of the OPCC Chairman the essence of the violation is that Bank Millennium informed consumers (it
regards 78 agreements) in responses to their complaints, that the court verdict stating the abusiveness of the provisions
of the loan agreement regarding exchange rates does not apply to them. According to the position of the OPCC
Chairman the abusiveness of contract\u2019s clauses determined by the court\u00a0 in the course of abstract control is
constitutive and effective for every contract from the beginning. As a result of the decision, Bank Millennium was
obliged to:
1) send information on the UOKiK\u2019s decision to the said 78 clients;
2) place the information on\u00a0 decision and the decision itself on the website and on Twitter;
3) to pay a fine amounting to PLN 20.7 million (Euros 4.42 million).
Bank Millennium lodged an appeal within the statutory time limit.
On 7 January 2020, the first instance court dismissed Bank Millennium's appeal in its entirety. Bank Millennium appealed
against the judgment within the statutory deadline. The court presented the view that the judgment issued in the
course of the control of a contractual template (in the course of an abstract control), recognizing the provisions of the
template as abusive, determines the abusiveness of similar provisions in previously concluded contracts. Therefore, the
information provided to consumers was incorrect and misleading. As regards the penalty imposed by OPCC, the court
pointed out that the policy of imposing penalties by the Office had changed in the direction of tightening penalties and
that the court agrees with this direction.
In Bank Millennium's assessment, the Court should not assess Bank Millennium's behaviour in 2015 from the perspective
of today's case-law views on the importance of abstract control (it was not until January 2016 that the Supreme Court's
resolution supporting the view of the OPCC Chairman was published), the more penalties for these behaviours should
not be imposed using current policy. The above constitutes a significant argument against the validity of the judgment
and supports the appeal which Bank Millennium submitted to the Court of second instance.
The second instance court, in its judgment of 24 February 2022, completely revoked the decision of the OPCC
Chairman. On 31 August 2022, the OPCC Chairman lodged a cassation appeal to the Supreme Court. Bank Millennium
believes that the prognosis regarding the litigation chances of winning the case before the Supreme Court is positive.
Bank Millennium (along with other banks) is also a party to the dispute with OPCC, in which the OPCC Chairman
recognized the practice of participating banks, including Bank Millennium, in an agreement aimed at jointly setting
interchange fee rates charged on transactions made with Visa and Mastercard cards as restrictive of competition, and
by decision of 29 December 2006 imposed a fine on Bank Millennium in the amount of PLN 12.2 million (Euros 2.61
million). Bank Millennium, along with other banks, appealed the decision.
In connection with the judgment of the Supreme Court and the judgment of the Court of Appeal in Warsaw of 23
November 2020, the case is currently pending before the court of first instance - the Court of Competition and
Consumer Protection. Bank Millennium has created a provision in the amount equal to the imposed penalty.
4. On 22 September 2020, Bank Millennium received decision of the Chairman of the Office for Protection of
Competition and Consumers (OPCC Chairman) recognising clauses stipulating principles of currency exchange applied in
the so-called anti-spread annex as abusive and prohibited the use thereof.
Penalty was imposed upon Bank Millennium in the amount of PLN 10.5 million (Euros 2.24 million). Penalty amount
takes account of two mitigating circumstances: cooperation with the Office for Protection of Competition and
Consumers and discontinuation of the use of provisions in question.
Bank Millennium was also requested, after the decision becomes final and binding, to inform consumers, by registered
mail, to the effect that the said clauses were deemed to be abusive and therefore not binding upon them (without need
to obtain court\u2019s decision confirming this circumstance) and publish the decision of the case on Bank Millennium\u2019s
website.
In the decision justification delivered in writing the OPCC Chairman stated that FX rates determined by Bank Millennium
were determined at Bank Millennium\u2019s discretion (on the basis of a concept, not specified in any regulations, of average
inter-bank market rate). Moreover, client had no precise knowledge on where to look for said rates since provision
referred to Reuters, without precisely defining the relevant site.
Provisions relating to FX rates in Bank Millennium\u2019s tables were challenged since Bank Millennium failed to define when
and how many times a day these tables were prepared and published.
In justification of the decision, the OPCC Chairman also indicated that in the course of the proceeding, Bank Millennium
presented various proposed solutions, which the OPCC Chairman deemed to be insufficient.
The decision is not final and binding. Bank Millennium appealed against the said decision within statutory term.
On 31 March 2022, the first instance court revoked the entire decision of the Chairman of the OPCC. On 23 May 2022,
the Chairman of the OPCC filed an appeal. On 26 October 2022, the Court of Appeal changed the judgment of the court
of first instance and shared the position of the Chairman of the OPCC as to the abusiveness of the provisions regarding
the determination of exchange rates in the annexes concluded with foreign currency borrowers. On 21 November 2022,
the Court of Appeal, at the request of Bank Millennium, suspended the execution of the judgment until the end of the
cassation proceedings. Bank Millennium filled a cassation appeal to the Supreme Court.
5. As at 31 December 2022, the most important proceedings, in the group of the court cases where the Group\u2019s
companies are defendant, are following:
- Bank Millennium is a defendant in three court proceedings in which the subject of the dispute is the amount of the
interchange fee. In two of the abovementioned cases, Bank Millennium was sued jointly and severally with another
bank, and in one with another bank and card organizations. The total value of claims submitted in these cases is PLN
729.6 million (Euros 155.84 million). The proceedings with the highest value of the submitted claim are brought by PKN
Orlen SA, in which the plaintiff demands payment of PLN 635.7 million (Euros 135.79 million). The plaintiff in this
proceeding alleges that the banks acted under an agreement restricting competition on the acquiring services market
by jointly setting the level of the national interchange fee in the years 2006-2014. In the other two cases, the charges
are similar to those raised in the case brought by PKN Orlen SA, while the period of the alleged agreement is indicated
for the years 2008-2014. According to current estimates of the risk of losing a dispute in these matters, Bank Millennium
did not create a provision. In addition, we point out that Bank Millennium participates as a side intervener in four other
proceedings regarding the interchange fee. Other banks are the defendant. Plaintiffs in these cases also accuse banks
of acting as part of an agreement restricting competition on the acquiring services market by jointly setting the level of
the national interchange fee in the years 2008-2014.
- A lawsuit brought up by Europejska Fundacja Wsp\u00f3\u0142pracy Polsko-Belgijskiej/European Foundation for Polish-Belgian
Cooperation (EFWP-B) against Bank Millennium S.A., worth of the dispute PLN 521.9 million (Euros 111.48 million) with
statutory interest from 5 April 2016 until the day of payment. The plaintiff filed the suit dated 23 October 2015 to the
Regional Court in Warsaw; the suit\u00a0 was served to Bank Millennium on 4 April 2016. According to the plaintiff, the basis
for the claim is damage to their assets, due to the actions taken by Bank Millennium and consisting in the wrong
interpretation of the Agreement for working capital loan concluded between Bank Millennium and PCZ S.A., which
resulted in placing the loan on demand. In the case brought by EFWP-B, the plaintiff moved for securing the claim in
the amount of PLN 250.0 million (Euros 53.40 million). The petition was dismissed on 5 September 2016 with legal
validity by the Appellate Court. Bank Millennium is requesting complete dismissal of the suit, stating disagreement with
the charges raised in the claim. Supporting the position of Bank Millennium, Bank Millennium\u2019s attorney submitted a
binding copy of final verdict of Appeal Court in Wroc\u0142aw favourable to Bank Millennium, issued in the same legal state
in the action brought by PCZ SA against Bank Millennium. At present, the Court of first instance is conducting evidence
proceedings.
As at 31 December 2022, the total value of the subjects of the other litigations in which the Group\u2019s companies\u00a0
appeared as defendant, stood at PLN 3,876.4 million (Euros 828.01 million) (excluding the class actions described below
and in note 57). In this group the most important category are cases related with FX loans mortgage portfolio and cases
related to forward transactions (option cases).
6. On 3 December 2015 a class action was served on Bank Millennium. A group of Bank Millennium's debtors (454
borrowers party to 275 loan agreements) is represented by the Municipal Consumer Ombudsman in Olsztyn. The
plaintiffs demanded payment of the amount of PLN 3.5 million (Euros 0.75 million), claiming that the clauses of the
agreements, pertaining to the low down payment insurance, are unfair and thus not binding. Plaintiff extended the
group in the court letter filed on 4 April 2018, therefore the claims increased from PLN 3.5 million (Euros 0.75 million)
to over PLN 5 million (Euros 1.07 million).
Actual status:
On 1 October 2018, the group's representative corrected the total amount of claims pursued in the proceedings and
submitted a revised list of all group members, covering the total of 697 borrowers \u2013 432 loan agreements. The value of
the subject of the dispute, as updated by the claimant, is PLN 7,371,107.94 (Euros 1,574,484.78).
By the resolution of 1 April 2020 the court established the composition of the group as per request of the plaintiff and
decided to take witness evidence in writing and called on the parties to submit questions to the witnesses. Bank
Millennium submitted a pleading with questions to witnesses in July 2020. Currently, the court is collecting written
testimony from witnesses. The date of the hearing has not been set at the moment.
As at 31 December 2022, there were also 218 individual court cases regarding LTV (loans-to-value) insurance (cases in
which only a claim for the reimbursement of the commission or LTV insurance fee is presented).
7. On 13 August 2020, Bank Millennium received lawsuit from the Financial Ombudsman. The Financial Ombudsman, in
the lawsuit, demands that Bank Millennium and the Insurer (TU Europa) be ordered to discontinue performing unfair
market practices involving, as follows:
- presenting the offered loan repayment insurance as protecting interests of the insured in case when insurance
structure indicates that it protects Bank Millennium\u2019s interests;
- use of clauses linking the value of insurance benefit with the amount of borrower\u2019s debt;
- use of clauses determining the amount of insurance premium without prior risk assessment (underwriting);
- use of clauses excluding insurer\u2019s liability for insurance accidents resulting from earlier causes.
Furthermore, the Ombudsman requires Bank Millennium to be ordered to publish, on its website, information on use of
unfair market practices.
The lawsuit does not include any demand for payment, by Bank Millennium, of any specified amounts. Nonetheless, if
the practice is deemed to be abusive it may constitute grounds for future claims to be filed by individual clients.
The case is being examined by the court of first instance.
8. On 1 October 2015, a set of entities connected to a group with debts in default to BCP amounting to Euros 170
million, resulting from a loan agreement signed in 2009 - debts already fully provisioned in the Bank's accounts -, filed
against BCP, after receiving the Bank's notice for mandatory payment, a lawsuit requesting that:
a) the court declares that two of the defendants are mere fiduciary owners of 340,265,616 BCP shares, since they acted
pursuant to a request made by the Bank for the making of the respective purchases, and also that the court orders the
cancellation of the registration of those shares in the name of those companies;
b) the court declares the nullity of the financing agreement established between the plaintiffs and the Bank, due to
relative simulation;
c) the court sentences the Bank, in accordance with the legal regime of the mandate without representation, to
become liable for the amounts due to the institution, abstaining from requesting those amounts to the plaintiffs and to
refund them the cost they incurred while complying with that mandate, namely, Euros 90,483,816.83 regarding Banco
Esp\u00edrito Santo, S.A. (BES) and Euros 52,021,558.11 regarding Caixa Geral de Dep\u00f3sitos, S.A. (CGD), plus default
interests;
d) the amount of the lawsuit determined by the plaintiffs is Euros 317,200,644.90;
e) the Bank opposed and presented a counter claim, wherein it requests the conviction, namely, of a plaintiff company
in the amount of Euros 185,169,149.23 for the loans granted, plus default interests and stamp tax.
The court issued a curative act and already ascertained the factual basis that are proven and that must be proven.
The expertise was carried out and the expert report was submitted. There is a deadline for completing and concluding
the expert report, in its final version, since the Bank presented a complaint about various aspects of the expert's
report, in its first version.
9. Resolution Fund
Resolution measure of Banco Esp\u00edrito Santo, S.A.
On 3 August 2014, with the purpose of safeguarding the stability of the financial system, Banco de Portugal applied a
resolution measure to Banco Esp\u00edrito Santo, S.A. (BES) in accordance with the Article 145-C (1.b) of the Decree-law no.
298/92, of 31 December 1992, as amended (the \u201cBanking Law\u201d), which entailed, inter alia, the partial transfer of
assets, liabilities, off-balance sheet items and assets under management into a transition bank, Novo Banco, S.A. (Novo
Banco), incorporated on that date by a decision issued by Banco de Portugal. Within the scope of this process, the
Resolution Fund made a capital contribution to Novo Banco amounting to Euros 4,900 million, becoming, on that date,
the sole shareholder. Further, in accordance with information published on the Resolution Fund\u2019s website, the
Resolution Fund borrowed Euros 4,600 million, of which Euros 3,900 million were granted by the Portuguese State and
Euros 700 million by a group of credit institutions, including the Bank.
As announced on 29 December 2015, Banco de Portugal transferred to the Resolution Fund the liabilities emerging from
the \u201ceventual negative effects of future decisions regarding the resolution process that may result in liabilities or
contingencies\u201d.
On 7 July 2016, the Resolution Fund declared that it would analyse and evaluate the diligences to be taken, following
the publication of the report on the result of the independent evaluation, made to estimate the level of credit recovery
for each category of creditors under a hypothetical scenario of a normal insolvency process of BES on 3 August 2014.
In accordance with the applicable law, when the BES liquidation process is over, if it is verified that the creditors,
whose credits were not transferred to Novo Banco, would take on a higher loss than the one they would hypothetically
take if BES had gone into liquidation right before the application of the resolution measure, such creditors shall be
entitled to receive the difference from the Resolution Fund.
On 31 May 2019, the Liquidation Committee of BES presented a list of all the acknowledged and a list of the non-
acknowledged creditors before the court and the subsequent terms of the proceedings. These lists detail that the total
acknowledged credits, including capital, remunerative and default interest amounts to Euros 5,056,814,588, of which
Euros 2,221,549,499 are common credits and Euros 2,835,265,089 are subordinated claims, and no guaranteed or
privileged claims exist. Both the total number of acknowledged creditors and the total value of the acknowledged
credits and their ranking will only be ultimately determined upon the definitive judicial judgment of the verification
and ranking of credits to be given in the liquidation proceedings.
Following the resolution measure of BES, a significant number of lawsuits against the Resolution Fund was filed and is
underway. According to note 20 of the Resolution Fund\u2019s annual report of 2021, \u201cLegal actions related to the
application of resolution measures have no legal precedents, which makes it impossible to use case law in its
evaluation, as well as to obtain a reliable estimate of the associated contingent financial impact. (\u2026) The Resolution
Fund, supported by legal advice of the attorneys for these actions, and in light of the legal and procedural
information available so far, considers that there is no evidence to cast doubt on their belief that the probability of
success is higher than the probability of failure\u201d.
According to note 22 of the Resolution Fund\u2019s annual report of 2021, \"In addition to the Portuguese courts, it is
important to take into account the litigation of Novo Banco, S.A., in other jurisdictions, being noteworthy, for its
materiality and respective procedural stage, the litigation in the Spanish jurisdiction. (...) Regarding litigation in the
Spanish jurisdiction, during the years 2018 to 2021, ten (decisions) have become final and unappealable condemning
Novo Banco, Spanish branch, as well as three sentences in relation to which due compensation has been requested
from the Resolution Fund\u201d.
On 31 March 2017, Banco de Portugal communicated the sale of Novo Banco, where it states the following: \"Banco de
Portugal today selected Lone Star to complete the sale of Novo Banco. The Resolution Fund has consequently signed
the contractual documents of the transaction. Under the terms of the agreement, Lone Star will inject a total of Euros
1,000 million in Novo Banco, of which Euros 750 million at completion and Euros 250 million within a period of up to 3
years. Through the capital injection, Lone Star will hold 75% of the share capital of Novo Banco and the Resolution
Fund will maintain 25% of the share capital\u201d.
The terms agreed also included a Contingent Capital Agreement (CCA), under which the Resolution Fund, as a
shareholder, undertakes to make capital injections if certain cumulative conditions are met related to the performance
of a specific portfolio of assets and to the capital ratios of Novo Banco going forward.
If these conditions are met, the Resolution Fund may be called upon to make a payment to Novo Banco for the lesser of
the accumulated losses in the covered assets and the amount necessary to restore the capital ratios at the agreed
levels. Any capital injections to be carried out pursuant to this contingent mechanism are limited to an absolute cap.
The terms agreed also provide for mechanisms to safeguard the interests of the Resolution Fund, to align incentives as
well as monitoring mechanisms, notwithstanding the limitations arising from State Aid rules.
On 18 October 2017, following the resolution of the Council of Ministers no. 151-A/2017 of 2 October 2017, Banco de
Portugal communicated the conclusion of the sale of Novo Banco to Lone Star, with an injection by the new shareholder
of Euros 750 million, followed by a further capital increase of Euros 250 million by the end of 2017. Upon completion of
the transaction, the status of Novo Banco as a bridge institution ceased, fully complying with the purposes of the
resolution of BES.
On 26 February 2018, the European Commission published the non-confidential version of its decision regarding the
approval of State aid underlying Novo Banco\u2019s sale process. This statement identifies the three support measures by the
Resolution Fund and the Portuguese State that are part of the sale agreement associated with a total gross book value
of around Euros [10-20] billion(1) that revealed significant uncertainties regarding adequacy in provisioning(2):
(i)Contingent Capital Agreement (CCA) which allows Lone Star to reclaim, from the Resolution Fund, funding costs,
realised losses and provisions related to an ex-ante agreed portfolio of existing loan stock, up to a maximum of
Euros 3.89 billion, subject to a capital ratio trigger (CET1 below 8%-13%) as well as to some additional
conditions(1)(2)(3);
(ii)underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount necessary
(but no more than Euros 400 million). The amount that can be reclaimed by the Resolution Fund under the CCA is
subject to the cap of Euros 3.89 billion(2);
(iii) in case the Supervisory Review and Evaluation Process (\u201cSREP\u201d) total capital ratio of Novo Banco falls below the
SREP total capital requirement, the Portuguese State will provide additional capital in certain conditions and
through different instruments(2). According to the audit report on the management of Novo Banco conducted by the
Court of Auditors and released on 12 July 2022, \"the risk of triggering the additional capital mechanism (capital
backstop), up to Euros 1.6 billion, provided for in the commitments made by the Portuguese State to ensure the
viability of NB, exists\u201d.
According to Novo Banco\u2019s earnings presentation of December 2022, Novo Banco still has Euros 485 million under the
MCC in addition to the Euros 209 million included in the capital call for 2021. The mechanism is in place until December
2025, date that can be extended, under certain conditions, by one additional year.
According to a statement issued by the Resolution Fund on 13 February 2023, \"the Ministry of Finance has disclosed that
the European Commission intends to consider the restructuring process of Novo Banco as completed. The information
disclosed today confirms the successful restructuring of Novo Banco, resulting from the combined execution of the
restructuring plan agreed in 2017, under the sale transaction conducted by Banco de Portugal, and the sale
agreements, namely the CCA, under which the Resolution Fund transferred to Novo Banco 485 million euros, less than
the maximum amount set in the contract (3,890 million euros). The completion of the restructuring of Novo Banco, in
which the Resolution Fund maintains a 19.31% stake, is also another indicator that Novo Banco should not need to
request any further payment to the Resolution Fund under the CCA, without prejudice to the ongoing litigation or that
still may occur regarding the amounts already requested by Novo Banco in relation to past years and that the Resolution
Fund considers that are not due. In the statement issued by Banco de Portugal on the same day, it is also disclosed that
\"The conclusion of the Novo Banco restructuring process also results in the end of the backstop mechanism, which
provided for the possibility, which was always considered remote, of the Portuguese State providing extraordinary
support to Novo Banco in extreme scenarios. This mechanism protected Novo Banco and the national financial system
from more adverse scenarios, which did not materialize. With the end of the backstop, the financial risk for the
Portuguese State is eliminated\".
According to the 2018 Resolution Fund\u2019s annual report, the Resolution Fund and Novo Banco have agreed that a
Verification Agent - an independent entity which is essentially responsible for clarifying any differences that may exist
between Novo Banco and the Resolution Fund regarding the set of calculations inherent to the CCA or regarding the
practical application of the principles stipulated in the contract - is in charge of confirming that the perimeter of the
mechanism is correct and that the balance sheet values of Novo Banco are being correctly reflected in the mechanism,
as well as verifying the underlying set of calculations, namely by confirming the correct calculation of losses and the
reference value of the assets. According to the 2021 Resolution Fund\u2019s annual report, the Resolution Fund follows the
work carried out by the Verification Agent, while specific analyses are being requested.
(1) Exact value not disclosed by the European Commission for confidentiality reasons
(2) As referred to in the respective European Commission Decision
(3) According to 2018 Novo Banco\u2019s earnings institutional presentation, the \u201cminimum capital condition\u201d is (i) CET1 or Tier 1 < CET1 or
Tier 1 SREP requirement plus a buffer for the first three years (2017-2019); (ii) CET1 < 12%
In its 2021 annual report, the Resolution Fund states that \u201ceventual new requests regarding future periods, with
significant uncertainty regarding the relevant parameters for the calculation of eventual responsibilities, under the
terms of the CCA, are recorded as contingent liabilities\u201d.
The Resolution Fund disclosed on 17 June 2019 a set of clarifications related to the payment due in 2019 under the CCA
with Novo Banco, namely:
- For payments from the Resolution Fund to be made (limited to a maximum of Euros 3,890 million over the lifetime of
the mechanism), losses on the assets under the contingent mechanism should be incurred and the capital ratios of Novo
Banco should stand below the agreed reference thresholds;
- The payment to be made by the Resolution Fund corresponds to the lower of the accumulated losses on the assets
covered and the amount necessary to restore the capital ratios above the minimum reference threshold;
- The reference capital ratios are, in 2017, 2018 and 2019, linked to the regulatory requirements applicable to Novo
Banco (CET1 ratio of 11.25% and Tier 1 ratio of 12.75%), but, as from 2020, the reference ratio will correspond to a
CET1 ratio of 12%;
- The initial reference value of the portfolio comprising the CCA was, as of 30 June 2016, Euros 7,838 million (book
value of the associated assets, net of impairments);
- The value of the portfolio, as at 31 December 2021, amounted to Euros 1.8 billion (book value, net of impairments),
according to Novo Banco\u2019s First Half 2022 report.
According to a notice issued by the Resolution Fund on 4 June 2020, the \"Resolution Fund and Novo Banco have
initiated an arbitration procedure to clarify the treatment that should be given, under the CCA, of the effects of Novo
Banco\u2019s decision to waive the transitional regime it currently benefits from and which aims to reduce the impact of
the introduction of IFRS 9 on credit institutions' own funds. This issue falls within the scope of the implementation of
the CCA, which sets the maximum amount of payments to be made by the Resolution Fund at Euro 3,890 million. Thus,
even if the arbitration procedure were to have an unfavourable outcome for the Resolution Fund's claims, its effects
would fall under the maximum limit of Euros 3,890 million in accordance with the CCA. The above arbitral proceedings
therefore do not represent an additional risk compared to the ceiling of Euros 3,890 million\".
According to Resolution Fund\u2019s annual report of 2021 (Box 1), \"the award of the Arbitration Court, constituted under
the aegis of the International Chamber of Commerce, was known at the end of October 2021, and was favorable to the
Resolution Fund. The Arbitration Court considered that (...) the financial impact on Novo Banco's own funds could not
be covered by the CCM. The value of the dispute at the date of the award amounted to 169 million euros, an amount
that the Resolution Fund would have had to pay to Novo Banco if the Arbitration Court's award had not been
favorable\".
Additionally, regarding the intervention of the Resolution Fund concerning the transitional regime of the
implementation of the dynamic component of IFRS 9, Novo Banco estimates a positive impact on its own funds in the
amount of Euros 171 million (which implies a reduction in the capital requirements that Novo Banco intended to pass on
to the CCM in the amount of Euros 161.6 million). Accordingly, the Resolution Fund initiated a second arbitration
proceeding, also under the aegis of the International Chamber of Commerce, with a view to settling the difference
between the parties. This process is in progress, and it is estimated that an award will be rendered during 2023.
According to a statement by the Resolution Fund on 3 September 2020, following the payment made in May 2019 by the
Resolution Fund to Novo Banco in compliance with the CCA, a special audit determined by the Government was carried
out. Information was presented by the independent entity that carried out the special audit, showing that Novo Banco
has been operating with a strong influence of the vast legacy of non-productive assets, originated in BES, which
resulted in impairment charges and provisions, but have also contributed to rendering Novo Banco\u2019s internal procedures
more robust. Regarding the exercise of the powers of the Resolution Fund under the CCA, the audit results reflect the
adequacy of the principles and the adopted criteria.
According to Resolution Fund\u2019s annual report of 2021, the procedure relating to the payment to Novo Banco regarding
2020 accounts has been concluded, concluding that a payment of Euros 112 million was due to Novo Banco from the
Resolution Fund which had remained pending further verification. Therefore, that amount was paid to Novo Banco, in
December 2021, after the conclusion of the supplementary analysis promoted by the Resolution Fund. This amount,
according to a statement issued by the Resolution Fund on 23 December 2021, was already provisioned, included in the
total amount of the provision (Euros 429,012,629).
According to Resolution Fund\u2019s annual report of 2021, Novo Banco submitted to the International Chamber of
Commerce a request for arbitration to have recognized the right to receive an aggregate amount of Euros 165,441.9
thousand (divestment of Novo Banco's activity in Spain in the amount of Euros 147,441.9 thousand and valuation
differences regarding a set of assets held by Novo Banco in the amount of Euros 18,000 thousand) which the Resolution
Fund considered, and considers, not to merit the coverage of the CCM.
According to Novo Banco\u2019s First Half 2022 report (note 30), Novo Banco adhered to the Special Regime applicable to
Deferred Tax Assets under Law No. 61/2014, of 26 August, according to which, the deferred tax assets recorded until 31
December 2015 can be converted into tax credits when the taxable entity reports an annual net loss, in accordance to
the proportion of the amount of the said net loss to total equity at the individual company level, A special reserve was
established with an amount identical to the tax credit approved, increased by 10%. The conversion rights are securities
that entitle the State to require Novo Banco to increase its share capital by incorporating the amount of the special
reserve and consequently issuing and delivering free of charge ordinary shares. The shareholders have the right to
acquire the conversion rights attributed to the Portuguese State.
According to the Resolution Fund\u2019s 2021 annual report, under the terms of the sale of Novo Banco, the 75% of the share
capital of Novo Banco held by Nani Holdings is not affected by the dilution associated with the Special Regime
applicable to deferred tax assets (REIAD).
According to Resolution Fund\u2019s annual report of 2021, on 17 December 2021, Novo Banco, carried out a capital increase
in the amount of Euros 154,907.3 thousand, through the conversion of the rights that had been attributed to the State
due to the conversion of the deferred tax assets of Novo Banco, into tax credits, with reference to the 2015 tax period,
under the REIAD. As of that date, the State became a shareholder of Novo Banco, having been attributed a participation
corresponding to 1.56% of the share capital. As a result, the participation of the Resolution Fund was diluted from 25%
to 23.44%.
According to Novo Banco\u2019s announcement of 4 November 2022, the share capital increase arising from the conversion of
conversion rights relating to 2016 and 2017 fiscal years issued under the REAID increased the Portuguese State
shareholding to 5.69% and Lone Star kept the 75% share capital of Novo Banco. Only the participation of the Resolution
Fund will be diluted, concomitantly.
Also, according to the Resolution Fund\u2019s 2021 annual report, it is estimated that the aggregate effect of the application
of the REAID will result in the reduction of the participation of the Resolution Fund to 9.05%.
On 3 May 2021, following the request of the Portuguese parliament in October 2020 to review the operations and
management of Novo Banco that led to the need to transfer funds from the Resolution Fund to Novo Banco, the
Resolution Fund announced that the audit report conducted by Tribunal de Contas (\u201cCourt of Auditors\u201d) was released.
The Court of Auditors concluded that the public financing of Novo Banco through the CCA contributed to the stability of
the financial system, particularly as it avoided the bank\u2019s liquidation and reduced systemic risk. According to the
Resolution Fund, the audit does not identify any impediment to the fulfilment of commitments and contracts arising
from BES\u2019s resolution process, initiated in August 2014.
Resolution measure of Banif \u2013 Banco Internacional do Funchal, S.A.
On 19 December 2015, the Board of Directors of Banco de Portugal announced that Banif \u201cwas failing or likely to fail\u201d
and started an urgent resolution process of the institution through the partial or total sale of its activity, which was
completed on 20 December 2015 through the sale to Banco Santander Totta S.A. (BST) of the rights and obligations of
Banif, formed by the assets, liabilities, off-balance sheet items and assets under management.
The largest portion of the assets that were not sold, were transferred to an asset management vehicle denominated
Oitante, S.A. (Oitante) specifically created for that purpose, having the Resolution Fund as the sole shareholder. For
that matter, Oitante issued bonds representing debt in the amount of Euros 746 million. The Resolution Fund provided a
guarantee and the Portuguese State a counter-guarantee. The operation also involved State aid, of which Euros 489
million were provided by the Resolution Fund, which was funded by a loan granted by the State.
According to Oitante's press release on 12 January 2022, \"during 2021, it repaid Euros 160.5 million related to its bond
loan of Euros 746 million, contracted when it was created on 20 December 2015 due to the resolution of Banif\". On 4
July 2022, Oitante - 100% owned by the Resolution Fund - completed the process of repayment of the bonds issued in
connection with the resolution of BANIF. Oitante's debt, which initially amounted to Euros 746 million, was thus fully
repaid. With the early repayment of the debt, the Resolution Fund's responsibility as guarantor also ceases, as well as
the Portuguese State's responsibility as provider of a counter-guarantee.
On 16 January 2023, the Liquidation Committee of Banif announced a list of all the acknowledged and a list of the non-
acknowledged creditors. According to the Resolution Fund\u2019s 2021 annual report, the Resolution Fund holds a claim on
Banif of Euros 489 million, which has a higher claim ranking provided for in article 166-A of the RGICSF. Under the
judicial liquidation process of Banif, which was initiated following the resolution, the independent evaluator estimates
that the level of recovery of the financial support made available by the Resolution Fund, as having a higher ranking at
the end of the liquidation, should be 7.6%.
On 12 January 2021, Banco de Portugal was informed that the Administrative and Fiscal Court of Funchal dismissed a
lawsuit involving several disputes associated to Banif\u2019s resolution measures applied by Banco de Portugal. In its
decision, the Court determined the legality and maintenance of Banco de Portugal\u2019s measures.
Liabilities and financing of the Resolution Fund
Pursuant to the resolution measures applied to BES and Banif, the Resolution Fund incurred on loans and assumed other
responsibilities and contingent liabilities resulting from:
- The State loans, on 31 December 2021, included the amounts made available (i) in 2014 for the financing of the
resolution measure applied to BES (Euros 3,900 million); (ii) to finance the absorption of Banif's losses (Euros 353
million); (iii) under the framework agreement concluded with the State in October 2017 for the financing of the
measures under the CCA (Euros 430 million plus Euros 850 million of additional funding requested in 2019 and Euros 850
million made available in 2020);
- Other funding granted:
\u2022in 2014 by the institutions participating in the Resolution Fund in the amount of Euros 700 million, in which the
Bank participates, within the scope of BES resolution measure;
\u2022in 2021 by seven domestic credit institutions, including BCP, to finance payments due under the CCA up to a
maximum of EUR 429 million;
- Underwriting by the Resolution Fund of a Tier 2 instrument to be issued by Novo Banco up to the amount of Euros 400
million. This underwriting did not take place as the instruments were placed with third party investors as disclosed by
Novo Banco on 29 July 2018;
- Effects of the application of the principle that no creditor of the credit institution under resolution may assume a loss
greater than the one it would take if that institution did not go into liquidation;
- Negative effects resulting from the resolution process that result in additional liabilities or contingencies for Novo
Banco, which must be neutralized by the Resolution Fund;
- Legal proceedings filed against the Resolution Fund;
- Guarantee granted to secure the bonds issued by Oitante, totally reimbursed, as described above.
- CCA allows Lone Star to claim, from the Resolution Fund, funding costs, realised losses and provisions related to the
aforementioned ex-ante portfolio of existing loan stock agreed upon the sale process to Lone Star up to Euros 3.89
billion under the aforementioned conditions, among which a reduction of Novo Banco\u2019s CET1 below 8%-13%;
- In case the Supervisory Review and Evaluation Process (SREP) total capital ratio of Novo Banco falls below the SREP
total capital requirement, the State will provide additional capital in certain conditions and through different
instruments as referred to in the respective European Commission Decision.
According to Resolution Fund\u2019s annual report of 2021, contingent liabilities from the CCA are limited to a maximum
aggregate amount of Euros 3,890 million and that the aggregate amount of this contingent liability, which corresponds
to the difference between that maximum amount and the amounts already paid by the Resolution Fund, amounts to
Euros 485 million.
The expectation of the Resolution Fund is that, except for what may eventually result from the pending arbitration
disputes with Novo Banco, no further payments will occur under the CCA. On the other hand, the value of payments
already made may be compensated, under the terms of the contracts, by the eventual recovery of credits that may
occur, to which the value of the shareholding of the Resolution Fund in Novo Banco must be added.
According to note 20 of the Resolution Fund\u2019s 2021 annual report, the Resolution Fund considers that, to date, there
are no elements that allow a reliable estimate of the potential financial effect of these potential liabilities.
By a public statement on 28 September 2016, the Resolution Fund and the Ministry of Finance communicated the
agreement based on a review of the terms of the Euros 3,900 million loan originally granted by the State to the
Resolution Fund in August 2014 to finance the resolution measure applied to BES. According to the Resolution Fund, the
extension of the maturity of the loan was intended to ensure the ability of the Resolution Fund to meet its obligations
through its regular revenues, regardless of the contingencies to which the Resolution Fund is exposed. On the same day,
the Office of the Minister of Finance also announced that increases in the liabilities arising from the materialization of
future contingencies will determine the maturity adjustment of State and bank loans to the Resolution Fund, required
from to maintain the contributory effort required from the banking sector at prevailing levels at that time.
According to the statement of the Resolution Fund of 21 March 2017:
- \u201cThe conditions of the loans obtained from the Fund to finance the resolution measures applied to Banco Esp\u00edrito
Santo, S.A. and to Banif \u2013 Banco Internacional do Funchal, S.A. were changed. These loans amount to Euros 4,953
million, of which Euros 4,253 million were granted by the Portuguese State and Euros 700 million were granted by a
group of banks\";
- \u201cThose loans are now due in December 2046, without prejudice to the possibility of early repayment based on the
use of the Resolution Fund's revenues. The revision of the loan\u2019s terms aimed to ensure the sustainability and financial
balance of the Resolution Fund. The terms allow the Resolution Fund to fully meet its liabilities based on regular
revenues and without the need for special contributions or any other type of extraordinary contributions\".
According to the audit report on the management of Novo Banco conducted by the Court of Auditors and released on 12
July 2022, \"the repayment of the Euros 2,130 million loans granted by the Portuguese State to the Resolution Fund will
not end in 2046, as expected, rather in 2056 (without payments under the CCA after 2021) or in 2059 (with the use of
the CCA cap). (...) In other, more pessimistic scenarios, these loans will still be being repaid in 2062\u201d.
According to a statement issued by the Resolution Fund on 31 December 2021, the Euros 700 million loan to the
Resolution Fund was provided by seven credit institutions (Caixa Geral de Dep\u00f3sitos, Banco Comercial Portugu\u00eas, Banco
BPI, Banco Santander Totta, Caixa Econ\u00f3mica, Montepio Geral, Banco BIC Portugu\u00eas and Caixa Central de Cr\u00e9dito
Agr\u00edcola M\u00fatuo).
On 2 October 2017, by Resolution no. 151-A/2017, of the Council of Ministers of the Portuguese State, as the ultimate
guarantor of financial stability, was authorised to enter into a framework agreement with the Resolution Fund, to make
available the necessary financial resources to the Resolution Fund, if and when the State deemed necessary, to satisfy
any contractual obligations that may arise from the sale of the 75% stake in Novo Banco. The above-mentioned
resolution further set out that the framework agreement should be subject to a time period that is consistent with the
undertakings of the Resolution Fund and should preserve the Resolution Fund\u2019s capacity to satisfy said obligations in
due time.
On 31 December 2021, the Resolution Fund's own resources had a negative equity of Euros 7,207.6 million, as opposed
to Euros 7,314.7 million at the end of 2020, according to the latest 2021 annual report of the Resolution Fund.
To repay the loans obtained and to meet other liabilities that it may take on, the Resolution Fund receives proceeds
from the initial and regular contributions from the participating institutions (including the Bank) and from the
contribution over the banking sector (created under Law no. 55-A/2010). It is also provided for the possibility of the
member of the Government responsible for the area of Finance to determine, by ordinance that the participating
institutions make special contributions, in the situations provided for in the applicable legislation, particularly if the
Resolution Fund does not have resources to satisfy its obligations.
Pursuant to Decree-Law no. 24/2013 of 19 February, which establishes the method for determining the initial, periodic
and special contributions to the Resolution Fund, provided for in the Banking Law, the Bank has been paying, since
2013, its mandatory contributions set out in the aforementioned decree-law.
On 3 November 2015, the Banco de Portugal issued Circular Letter no. 085/2015/DES, under which it is clarified that
the periodic contribution to the Resolution Fund should be recognised as an expense at the time of the occurrence of
the event which creates the obligation to pay the contribution, i.e. on the last day of April of each year, as stipulated
in Article 9 of the referred Decree-Law no. 24/2013, of 19 February, thus the Bank is recognising as an expense the
contribution to the Resolution Fund in the year in which it becomes due.
Decree-Law no. 24/2013 of 19 February further sets out that Banco de Portugal has the authority to determine, by way
of instruction (\u201cinstru\u00e7\u00e3o\u201d), the applicable yearly rate based on objective incidence of periodic contributions. The
instruction of Banco de Portugal no. 19/2022, published on 15 December 2022, set the base rate for 2023 for the
determination of periodic contributions to the Resolution Fund at 0.029% (0.057% in 2022).
The Resolution Fund issued, on 15 November 2015, a public statement declaring: \"...it is further clarified that it is not
expected that the Resolution Fund will propose the setting up of a special contribution to finance the resolution
measure applied to BES. Therefore, the potential collection of a special contribution appears to be unlikely\".
In 2015, following the establishment of the Single Resolution Fund (SRF), the Group made an initial contribution in the
amount of Euros 31,364 thousand. In accordance with the Intergovernmental Agreement on the Transfer and
Mutualisation of Contributions to the SRF, this amount was not transferred to the SRF but was used instead to partially
cover for the disbursements made by the RF in respect of resolution measures prior to the date of application of this
Agreement. This amount will have to be reinstated over a period of 8 years (started in 2016) through the periodic
contributions to the SRF. The Single Resolution Fund does not cover undergoing situations with the National Resolution
Fund as at 31 December 2015. The total amount of the contribution attributable to the Group in the financial year of
2022 was Euros 30,400 thousand, of which the Group delivered Euros 25,847 thousand and the remaining was
constituted as irrevocable payment commitment.
During the financial year of 2022, the Group made regular contributions to the Portuguese Resolution Fund in the
amount of Euros 18,668 thousand. The amount related to the contribution on the banking sector in Portugal, registered
in the financial year of 2022, was Euros 43,484 thousand. These contributions were recognized as a cost in the financial
year of 2022, in accordance with IFRIC no. 21 \u2013 Levies.
It is not possible, on this date, to assess the effects on the Resolution Fund due to: (i) the sale of the shareholding in
Novo Banco in accordance with the communication of Banco de Portugal dated 18 October 2017 and the information
provided by the European Commission on this subject under the terms described above, including the effects of the
application of the Contingent Capital Agreement and the Special Regime applicable to Deferred Tax Assets; (ii) the
application of the principle that no creditor of the credit institution under resolution may take on a loss greater than
the one it would take if that institution did not go into liquidation; (iii) additional liabilities or contingencies for Novo
Banco which need to be neutralized by the Resolution Fund; and, (iv) legal proceedings against the Resolution Fund.
According to Article 5 (e) of the Regulation of the Resolution Fund, approved by the Ministerial Order no. 420/2012, of
21 December, the Resolution Fund may submit to the member of the Government responsible for finance a proposal
with respect to the determination of amounts, time limits, payment methods, and any other terms related to the
special contributions to be made by the institutions participating in the Resolution Fund. According to public
communications from both the Resolution Fund and from the Government, there is no indication that any such special
contributions are foreseen.
According to the Resolution Fund\u2019s 2021 annual report, under note 8, \"the Resolution Fund is not obliged to present
positive equity. In case of insufficient resources, the Resolution Fund may receive special contributions, as determined
by the member of the Government responsible for finance, in accordance with article 153-I of the Banking Act,
although no such contributions are expected, in particular after a review of the financing conditions of the Resolution
Fund\", as described in the 2016 Annual Report. The Resolution Fund may also, exceptionally, obtain financial support
from the State, namely through loans or guarantees, as set out in article 153-J of the same regime.
On 9 September 2020, BCP informed that it has decided not to continue with the legal proceeding before the General
Court of the European Union with a view to partially annul the European Commission\u2019s decision regarding its approval
of the CCA of Novo Banco.
According to Resolution no. 63-A/2021 of 27 May 2021 of the Council of Ministers, a number of national financial
institutions offered to finance the Resolution Fund, under conditions considered as appropriate by it, increasing up to
Euros 475 million the direct financing of banks to the Resolution Fund and waiving a Portuguese State loan to the
Resolution Fund. The funding costs of the Resolution Fund (from the State and from banks) will continue to be
exclusively borne by periodic revenues, corresponding to the contributions paid by the banking sector. The payment
obligations arising from this loan benefit from a pari passu treatment with the payment obligations of the loans entered
into with the Portuguese State on 7 August 2014 and 31 December 2015 and with the Portuguese credit institutions on
28 August 2014.
According to the Resolution Fund\u2019s 2021 annual report, the payment to Novo Banco was fully funded with resources
from a loan from seven domestic credit institutions, including BCP, to finance payments that are due under the
aforementioned contingent capitalization mechanism, up to a maximum amount of Euros 475 million. Of this amount,
the Resolution Fund used Euros 429 million, which corresponds to the payment made to Novo Banco in 2021. The loan
matures in 2046 and bears interest at a rate corresponding to the sovereign cost of funding for the period between the
contract date (31 May 2021) and 31 December 2026, plus a margin of 15 b.p. The interest rate will be reviewed on 31
December 2026 and, after that, every five-years.
The budgetary amendment necessary to make the payment by the Resolution Fund was authorised by Order of the
Minister of State and Finance dated 31 May 2021.
10. Banco Comercial Portugu\u00eas, S.A., Banco ActivoBank S.A. and Banco de Investimento Imobili\u00e1rio, S.A. (company
merged into Banco Comercial Portugu\u00eas, S.A.) initiated an administrative proceeding to contest the resolution adopted
by Bank of Portugal on 31 March 2017 to sell Novo Banco (NB), and also, as a precaution, the deliberation adopted by
the Resolution Fund on the same date, as they foresee the sale of NB by resorting to a contingent capitalization
agreement under which the Resolution Fund commits to inject capital in Novo Banco up to Euros 3,9 billion, under
determined circumstances. In the proceedings, the claimants request the declaration of nullity or annulment of those
acts.
The proceedings were filed based on the information contained in the Communication from Bank of Portugal dated 31
March 2017, of which the claimants were not notified. The proceedings were filed in court on 4 September 2017. Bank
of Portugal and the Resolution Fund presented their arguments and, only very recently, Nani Holdings SGPS, S.A. did
the same since, by delay of the court, this company was only very recently notified to act as a party in the proceedings.
In addition to opposing to it, the defendants invoke three objections (i) the illegitimacy of the claimants, (ii) the
argument that the act performed by Bank of Portugal cannot be challenged and (iii) the material incompetence of the
court. The opponent party invoked the issue of passive illegitimacy since Novo Banco was not notified as an opponent
party.
The claimants replied to the arguments presented by the defendants and to the arguments presented by the opponent
party. After the presentation of the arguments, Bank of Portugal attached to the proceedings what it called an
evidence process (allegedly in compliance with the law) but most of the documents delivered were truncated in such a
way that neither the court nor the claimants are able to obtain adequate knowledge thereof. That issue was already
raised in the proceedings (requesting the court to order Bank of Portugal to deliver a true evidence process) but no
decision thereon has been made yet.
Currently, the proceedings are prepared for confirmation of the decision accepting the formalities of the right of action
(with the making of a decision on the specific objections invoked). In case the judge considers that Novo Banco is an
opponent party, the judge must start by issuing a pre-confirmation in order to request the claimants to identify it.
Afterwards, that Bank will be notified to present its opposition arguments.
The case was sent to the judge on 23 September 2019 and the Bank is awaiting a decision. BCP added legal opinions to
the records (Professors M\u00e1rio Aroso de Almeida and Manuel Fontaine de Campos).
11. Following the restructuring process agreed with the Directorate-General for Competition (DGComp) and the
Portuguese State, Group Banco Comercial Portugu\u00eas implemented a process of salary adjustment for a temporary
period. Additionally, it was agreed between the Bank and the Unions that, in the years after the State intervention and
if there are distributable profits, the Board of Directors and the Executive Committee would submit for approval of the
Shareholders\u2019 General Meeting a proposal of distribution of profits to the employees, which allows the distribution of an
accumulated total global amount at least equal to the total amount that was not received over the temporary term of
the salary adjustment, as described in the clause no. 151-E of BCP\u2019s Collective Labour Agreement, effective between
2014 and 2017.
At the General Meeting of 4 May 2022, following the proposal submitted by the Board of Directors, the application of
profits relating to the financial year of 2021 was approved, which included an extraordinary distribution to each
employee up to Euros 5,692,000, and the concrete determination of the amount to be attributed to each employee
must be fixed by the Executive Committee to employees who, having not already been fully compensated with the
results distributed in 2019 and 2020, remain in office on the date of payment of the remuneration corresponding to
June 2022.
12. The Bank was subject to tax inspections for the years up to 2019. As a result of the inspections in question,
corrections were made by the tax authorities, arising from the different interpretation of some tax rules. The main
impact of these corrections occurred regarding IRC, including in terms of the tax loss carry forwards and, in the case of
indirect tax, in the calculation of the Value-Added Tax (VAT) deduction pro rata used for the purpose of determining
the amount of deductible VAT and at the Stamp Duty level. Most of additional liquidations/corrections made by the tax
administration were the object of contestation by administrative and/or judicial means.
The Bank recorded provisions or deferred tax liabilities at the amount considered sufficient to offset the tax or tax loss
carry forwards, as well as the contingencies related to the fiscal years not yet reviewed by the tax administration.
", "dimensions": { "concept": "ifrs-full:DisclosureOfCommitmentsAndContingentLiabilitiesExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-709": { "value": "Provisions for legal risk related to foreign currency-indexed mortgage loans in Bank Millennium (Poland)1. Court claims and current provisions for legal riskOn 31 December 2022, Bank Millennium had 16,008 loan agreements and additionally 1,272 loan agreements from former Euro Bank under individual ongoing litigations (excluding claims submitted by the bank against clients i.e. debt collection cases) concerning the use of indexation clauses of FX mortgage loans submitted to the courts (78% loans agreements before the court of first instance and 22% loans agreements before the court of second instance) with the total value of claims filed against the Bank Millennium by the plaintiffs amounting to PLN 2,758.4 million (Euros 589.20 million) and CHF 201.9 million (Euros 204.53 million) [(Bank Millennium portfolio: PLN 2,536 million (Euros 541.70 million) and CHF 197.3 million (Euros 199.87 million) and former Euro Bank portfolio: PLN 222.5 million (Euros 47.53 million) and CHF 4.6 million (Euros 4.66 million)].The claims formulated by the clients in individual proceedings primarily concern the declaration of invalidity of the contract and payment for reimbursement of paid principal and interest instalments as undue performance, due to the alleged abusive nature of indexation clauses, or maintenance of the loan agreement in PLN and with interest rate indexed to CHF Libor.In addition, Bank Millennium is a party to the group proceedings (class action) subject matter of which is to determine Bank Millennium's liability towards the group members based on unjust enrichment (undue benefit) ground in connection with the FX mortgage loans. A judgment in these proceedings will not directly grant a right to any compensation amounts to the group members that have initiated this class action. The number of credit agreements covered by these proceedings is 3,273. On 24 May 2022, the court issued a judgment on the merits, dismissing the claim in full. Both parties requested a written justification of the judgment. On 13 December 2022, the claimant filed on appeal against the judgment of 24 May 2022 and the Bank Millennium also filed its response to the that appeal.The aggressive advertising campaign to encourage litigation against the financial sector affected the number of court disputes. Until the end of 2019, 1,982 individual claims were filed against Bank Millennium (in addition, 236 against former Euro Bank), in 2020 the number increased by 3,006 (265), in 2021 the number increased by 6,153 (422), while in 2022 the number increased by 5,750 (408).Based on ZBP (the Polish Banking Association) data gathered from all banks having FX mortgage loans, vast majority of disputes were finally resolved in favour of banks until 2019 year. However, after the Court of Justice of the European Union (CJEU) judgment issued on 3 October 2019 (Case C-260/18) the proportion has adversely changed and vast majority of court cases have been lost by banks. As far as Bank Millennium itself is concerned, from 2015 and until the end of 2022, 1,173 cases were finally resolved (1,111 in claims submitted by clients against Bank Millennium and 62 in claims submitted by Bank Millennium against clients i.e. debt collection cases). out of which 354 were settlements, 46 were remissions, 53 rulings were favorable for Bank Millennium and 720 were unfavorable, including both invalidation of loan agreements as well as conversions into PLN+LIBOR. Bank Millennium files appeals against negative judgements of the courts of first instance as well as submits cassation appeals to the Supreme Court against unfavourable for Bank Millennium legally binding verdicts. Currently, the statistics of first and second instance court decisions are much more unfavourable and its number is also increasing.The outstanding gross balance of the loan agreements under individual court cases and class action against Bank Millennium on 31 December 2022 was PLN 5,576 million (Euros 1,191.05 million) [of which the outstanding amount of the loan agreements under the class action proceeding was PLN 897 million (Euros 191.6 million)]. If all Bank Millennium\u2019s originated loan agreements currently under individual and class action court proceedings would be declared invalid without proper compensation for the use of capital, the pre-tax cost could reach PLN 5,499 million (Euros 1,174.6 million). Overall losses may be higher or lower depending on the final court decision in this regard. During 2022, Bank Millennium created a PLN 1,844 million provisions (Euros 393.88 million) and PLN 173 million (Euros 36.95 million) for former Euro Bank originated portfolio. The balance sheet value of provisions for the Bank Millennium portfolio at the end of December 2022 was at the level of PLN 4,986 million (Euros 1,065.02 million), and PLN 409 million (Euros 87.36 million) for former Euro Bank originated portfolio.The methodology developed by Bank Millennium for calculating provisions for legal risk involved with indexed loans is based on the following main parameters: (1) the number of current cases (including class actions) and potential future lawsuits that arise within a specified (three-year) time horizon; (2) the amount of Bank Millennium's potential loss in the event of a specific court judgment;(3) the probability of obtaining a specific court judgment calculated on the basis of statistics of decisions of the banking sector in Poland and legal opinions obtained;(4) in the case of the scenario of cancellation of the loan agreement, the element taken into account, with a view to legal assessments, is the calculation of Bank Millennium's loss, taking into account the assignment of a minimum probability of obtaining remuneration for the use of capital made available;(5) estimates involved with amicable settlements with clients, concluded in court or out of court:a.negotiations are conducted on a case-by-case basis and can be stopped at any time by Bank Millenniumb.as the negotiations efforts have already been material in the past, the probability of success may be lower in the future and at the same time, gradually most of the client base has had contact with Bank Millennium regarding potential negotiation of the conversion of the loans to PLN, so Bank Millennium is taking a conservative approach when calculating the potential future impact for the time being.Legal risk from former Euro Bank portfolio is fully covered by Indemnity Agreement with Societe Generale.Bank Millennium analyzed the sensitivity of the methodology for calculating provisions, for which a change in the parameters would affect the value of the estimated loss to the legal risk of litigation:ParameterScenarioImpact on loss due to legal risk related to the portfolio of mortgage loans in convertible currenciesChange in the number of lawsuitsAdditionally, 1 p.p. of active clients file a lawsuit against Bank MillenniumPLN 35 million (Euros 7.48 million)Change in the probability of winning a caseThe probability of Bank Millennium winning a case is lower by 1 p.pPLN 41 million (Euros 8.76 million)Change in estimated losses for each variant of the judgmentIncrease in losses for each variant of the judgment by 1 p.pPLN 40 million (Euros 8.54 million)Bank Millennium is open to negotiate case by case favourable conditions for early repayment or conversion of loans to PLN. As a result of these negotiations and other natural drivers, the number of active FX mortgage loans decreased by 8,449 in 2021 and 7,943 in 2022. As of end 2022, Bank Millennium had 38,011 active FX mortgage loans. Cost incurred in conjunctions with these negotiations totalled PLN 364.5 million (Euros 77.86 million) in 2021 and PLN 515.2 million (Euros 110.05 million) in 2022 and is presented mainly in \u2018Foreign exchange gains/(losses)\u2019 in the income statement, and in 2022 also in 'Results on modification'.Finally, it should also be mentioned, that Bank Millennium, as at 31 December 2022, had to maintain additional own funds for the coverage of additional capital requirements related to FX mortgage portfolio risks (Pillar II FX buffer) in the amount of 1.95 p.p. (1.94 p.p. at the Group level), part of which is allocated to operational/legal risk.CJEU and Supreme Court rulings relevant to risk assessmentOn 3 October 2019, the Court of Justice of the European Union ('the CJEU') issued the judgment in Case C-260/18 in connection with the preliminary questions formulated by the District Court of Warsaw in the case against Raiffeisen Bank International AG. The judgment of the CJEU, as regards the interpretation of European Union law made therein, is binding on domestic courts. The judgment in question interpreted Article 6 of Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts establishing that the said provision must be interpreted (i) as not precluding a national court, after finding that certain terms of a loan agreement indexed to a foreign currency and subject to an interest rate directly linked to the interbank rate of the currency concerned are unfair, from taking the view, in accordance with its domestic law, that that contract cannot continue in existence without those terms because the effect of their removal would be to alter the nature of the main subject matter of the contract; (ii) first, the consequences for the consumer of a contract being annulled in its entirety, must be assessed in the light of the existing or foreseeable circumstances at the time when the dispute arose, and that, second, for the purposes of that assessment, the wishes expressed by the consumer in that regard are the decisive factor; (iii)\u00a0 as precluding gaps in a contract caused by the removal of the unfair terms contained in that contract from being filled solely on the basis of national provisions of a general nature which provide that the effects expressed in a legal transaction are to be supplemented, inter alia, by the effects arising from the principle of equity or from established customs, which are neither supplementary provisions nor provisions applicable where the parties to the contract so agree; (iv)\u00a0 as precluding unfair terms contained in a contract from being upheld where their removal would entail that contract being annulled and the court takes the view that that annulment would give rise to unfavorable effects for the consumer, if the latter has not consented to them being upheld. The CJEU judgment concerns only the situation where the national court has previously found the contract term to be abusive. It is the exclusive competence of the national courts to assess, in the course of judicial proceedings, whether a particular contract term can be regarded as abusive in the circumstances of the case.On 29 April 2021, the CJEU issued the judgement in the case C-19/20 in connection with the preliminary questions formulated by the District Court in Gda\u0144sk in the case against of ex-BPH S.A., CJEU said that the Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as meaning that (i) it is for the national court to find that a term in a contract concluded between a seller or supplier and a consumer is unfair, even if it has been contractually amended by those parties. Such a finding leads to the restoration of the situation that the consumer would have been in in the absence of the term found to be unfair, except where the consumer, by means of amendment of the unfair term, has waived such restoration by free and informed consent, which it is for the national court to ascertain. However, it does not follow from that provision that a finding that the original term is unfair would, in principle, lead to annulment of the contract, since the amendment of that term made it possible to restore the balance between the obligations and rights of those parties arising under the contract and to remove the defect which vitiated it; (ii) they do not preclude the national court from removing only the unfair element of a term in a contract concluded between a seller or supplier and a consumer where the deterrent objective pursued by that directive is ensured by national legislative provisions governing the use of that term, provided that that element consists of a separate contractual obligation, capable of being subject to an individual examination of its unfair nature, and those provisions preclude the referring court from removing only the unfair element of a term in a contract concluded between a seller or supplier and a consumer where such removal would amount to revising the content of that term by altering its substance, which it is for that court to determine; (iii) the consequences of a judicial finding that a term if a contract concluded between a seller or supplier and a consumer is unfair are covered by national law and the question of continuity of the contract should be assessed by the national court of its own motion in accordance with an objective approach on the basis of those provisions;(iv) it is for the national court, finding that a term in a contract concluded between a seller or supplier and a consumer, to inform the consumer, in the context of the national procedural rules after both parties have been heard, of the legal consequences entailed by annulment of the contract, irrespective of whether the consumer is represented by a professional representative.On 18 November 2021, the Court of Justice of the European Union (CJEU) issued a judgment in case C-212/20 in connection with questions submitted by the District Court for Warsaw Wola, in Warsaw, in the case against Raiffeisen Bank International AG. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted (i) as meaning that the content of a clause of a loan agreement concluded between a seller or supplier and a consumer that sets the buying and selling prices of a foreign currency to which the loan is indexed must enable a consumer who is reasonably well informed and reasonably observant and circumspect to understand, on the basis of clear and intelligible criteria, the way in which the foreign currency exchange rate used to calculate the amount of the repayment instalments is set, in order that that consumer is able to determine himself or herself, at any time, the exchange rate applied by the seller or supplier; (ii) as precluding the national court, which has found that a term of a contract concluded between a seller or supplier and a consumer is unfair, within the meaning of Article 3(1) of that directive, from interpreting that term in order to remedy its unfairness, even if that interpretation would correspond to the common intention of the parties to that contract.On 10 June 2021, the Court of Justice of the European Union (CJEU) issued an order in case C-198/20 in connection with questions submitted by the District Court for Warsaw Wola in Warsaw in the case against Santander Bank Polska SA. The CJEU stated that the protection provided for in Council Directive 93/13/EEC is granted to all consumers, not just those who can be considered to be 'duly informed and reasonably observant and circumspect average consumers'.On 8 September 2022, the Court of Justice of the European Union (CJEU) issued a judgment in joined cases C-80/21, C-81/21, C-82/21 in connection with questions submitted by the District Court for Warsaw \u015ar\u00f3dmie\u015bcie in Warsaw in cases against Deutsche Bank SA and mBank SA. The CJEU stated the Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted (i) as precluding national case-law according to which the national court may declare unfair not the entire term of a contract concluded between a consumer and a seller or supplier, but only those parts of it which are unfair, so that the term remains partially effective after the removal of those parts, where such removal would be tantamount to revising the content of the term by affecting its substance, which is a matter for the national court to determine; (ii) as precluding national case-law according to which the national court may, after finding that an unfair term contained in a contract concluded between a consumer and a seller or supplier is void and does not result in the annulment of that contract as a whole, replace that term with a supplementary provision of national law; (iii) as precluding national case-law according to which the national court may, after finding that an unfair term contained in a contract concluded between a consumer and a seller or supplier is void and that the contract as a whole is void, replace the annulled term either by interpreting the parties\u2019 wishes in order to avoid the annulment of the contract, or by applying to the annulled unfair term a supplementary provision of national law, even though the consumer has been informed of the consequences of the annulment of that contract and has accepted them; (iv) as precluding national case-law according to which the 10\u2011year limitation period for a consumer\u2019s action for the restitution of sums unduly paid to a seller or supplier in performance of an unfair term contained in a credit agreement with a duration of 30 years begins to run on the date of each performance by the consumer, even though the consumer was not in a position, at that date, to assess the unfairness of the contractual term himself or herself or was not aware of the unfairness of the term, and regardless of the fact that the contract had a repayment period, in this case 30 years, which is much longer than the statutory limitation period of 10 years.On 7 May 2021, the Supreme Court composed of 7 judges of the Supreme Court, issued a resolution for which the meaning of legal principle has been granted, stating that: 1. An abusive contractual clause (art. 3851 \u00a7 1 of the Polish Civil Code), by force of the law itself, is ineffective to the benefit of the consumer who may consequently give conscious and free consent to this clause and thus restore its effectiveness retroactively.2. If, without the ineffective clause, the loan agreement cannot be binding, the consumer and the lender shall be entitle for separate claims for return of cash benefits made to the other part during the term of this agreement (art. 410 \u00a7 1 in relation to art. 405 of the Polish Civil Code). The lender may demand return of the performance from the moment the loan agreement becomes definitively ineffective.On 28 April 2022, the Supreme Court issued a resolution (III CZP 40/22) in which it indicated that in disputes with consumers, the provision of Article 358\u00ba1 of the Polish Civil Code is a special provision to Article 353\u00ba1 of the Civil Code, which means that if the prerequisites for the application of both provisions exist, the court should apply the special provision and declare the contractual provision definitively ineffective, rather than invalid. This decision of the Supreme Court should be perceived as significantly limiting the risk of Bank Millennium's claims for return of capital being time-barred.In this context, taking into consideration the recent negative evolution in the court verdicts regarding FX mortgage loans, and if such trend continues, Bank Millennium will have to regularly review and may need to continue to increase the balance of provisions allocated to court litigations.It can reasonably be assumed that the legal issues relating to foreign currency mortgage loans will be further examined by the national courts within the framework of disputes considered which would possibly result in the emergence of further interpretations, which are relevant for the assessment of the risks associated with subject matter proceedings. This circumstance indicates the need for constant analysis of these matters. Further request for clarification and ruling addressed to the European Court of Justice and Polish Supreme Court have already been filed and may still be filed with potential impact on the outcome of the court cases.2. Events that may impact foreign currency-indexed mortgage loans legal risk and related provisionOn 29 January 2021 a set of questions addressed by the First President of the Polish Supreme Court to the full Civil Chamber of the Supreme Court was published. This may have important consequences in terms of clarifications of relevant aspects of the court rulings and their consequences. The Civil Chamber of the Supreme Court has been requested for answering the questions concerning key matters related to FX mortgage agreements: (i) is it possible to replace - with a legal provisions or according\u00a0 commons practices - the abusive provisions of an agreement which refer to FX exchange rate determination; moreover, (ii) in case of impossibility of determining the exchange rate of a foreign currency in the indexed/denominated credit agreement - is it possible to keep the agreement still in force in its remaining scope; as well as (iii) if in case of invalidity of the CHF credit there would be applicable the theory of balance (i.e. does arise a single claim which is equal to the difference between value of claims of bank and the customer) or the theory of two conditions (separate claims for the bank and for the client that should be dealt with separately). The Polish Supreme Court has also been requested for answering the question on (iv) from which point in time there shall be starting the limitation period in case of bank's claim for repayment of amounts made available as a loan and (v) whether banks and consumers may receive remuneration for using their pecuniary means by another party.On 11 May 2021, the Civil Chamber of the Polish Supreme Court requested opinions on Swiss franc mortgage loans from five institutions including the National Bank of Poland (NBP), the Polish Financial Supervision Authority (UKNF), the Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman. The positions of: the Commissioner for Human Rights, the Children's Rights Ombudsman and the Financial Ombudsman are in general favourable to consumers, while the National Bank of Poland and the Polish Financial Supervision Authority present a more balanced position, including fair principles of treatment of FX mortgage borrowers vis-\u00e0-vis PLN mortgage borrowers, as well as balanced economic aspects regarding solutions for the problem that could be considered by the Polish Supreme Court.In the next meeting of the Supreme Court that took place on 2 September 2021, the Court did not address the answers to the submitted questions and no new meeting date is known.On 12 August 2021, in the case for payment brought by a consumer against Bank Millennium, the CJEU was asked for a preliminary ruling (C-520/21) whether, in the event that a loan agreement concluded by a bank and a consumer is deemed invalid from the beginning due to unfair contract terms, the parties, in addition to the reimbursement of the money paid in contracts (bank - loan capital, consumer - instalments, fees, commissions and insurance premiums) and statutory interest for delay from the moment of demanding for payment, may also claim any other benefits, including receivables in particular, remuneration, compensation, reimbursement of costs or valorization of the performance. The hearing was held on 12 October 2022. The hearing was attended by representatives of Bank Millennium, the consumer's representative, representatives of the European Commission, the Polish government, the Financial Ombudsman, the Commissioner for Human Rights, the Polish Financial Supervision Authority and the prosecutor. In its position, the European Commission opposed granting banks the right to an additional financial benefit for the consumer's use of the capital provided. At the same time, the Commission concluded that granting consumers the right to an additional financial benefit will not be contrary to the EU law. The representatives of the Polish government, the Financial Ombudsman, the Commissioner for Human Rights and the prosecutor also objected to granting banks the right to an additional benefit. The Chairman of the Polish Financial Supervision Authority pointed out that the essence of the problem is not the abusiveness of contractual clauses, but the appreciation of the Swiss Franc (CHF) against the zloty (PLN). In the opinion of the Chairman of the Polish Financial Supervision Authority, banks are entitled to economic compensation for allowing another entity to use the capital. Regarding the case C-520/21 which is awaiting decision by the CJEU, whose object essentially concerns possible compensation for financing when a mortgage loan agreement indexed to foreign currency concluded between a consumer and a bank is declared void from the beginning due to unfair contract terms, the Advocate General issued an opinion on 16 February 2023 in the sense that the Article 6 no. 1 and Article 7 no. 1 of Council Directive 93/13/EC of 5 of April 1993, concerning unfair terms in contracts concluded with consumers, must be interpreted as:- do not preclude a jurisprudential interpretation of national law under which the consumer, in addition to reimbursement the amounts paid under that contract and paying default interest at the statutory rate from the date of the reimbursement request, may present additional claims to the bank as a result of that declaration of invalidity. It is thus a matter for the national court to determine, by reference to its domestic law, whether consumers have the right to assert claims of that nature and, if so, to rule on their merits.- preclude a jurisprudential interpretation of national law under which, the Bank in addition to the reimbursement of the amounts paid under that contract and paying default interest at the statutory rate from the date of the reimbursement request, may present additional claims against the consumer as a result of that declaration of invalidity.If the final decision of the CJEU judge comes in the same direction as that of the Advocate General, this may lead to an increase in provisions for legal risk related to mortgage loans in CHF, especially if this results in a revision of the expected influx of new cases in court.On 9 December 2022, in the case brought by Bank Millennium against the borrower for payment \u2013 return of the capital made available to the borrower on the basis of an invalid capital contract and the equivalent value of the benefit related to the borrower's use of capital, the court referred a question to the CJEU for a preliminary ruling whether, if it is found that the loan contract concluded by the bank and the consumer is invalid from the beginning due to the conclusion of unfair contractual terms, in addition to the return of money paid in the performance of this contract (loan principal) and statutory late payment interest from the moment of the request for payment, the bank may also demand any other benefits, including receivables, in particular remuneration, compensation, reimbursement of costs or valorisation of the benefit. The case was registered under the reference number C-756/22. Referring the question, the court asked the CJEU to join the case with the above-mentioned ongoing proceedings under reference number C-520/21. The CJEU decided not to join the cases and simultaneously suspended case C-756/22 up to judgment in case C- 520/21.With the scope of settlements between Bank Millennium and borrower following the fall of the loan agreement is also connected the legal issue directed to the seven-person composition of the Polish Supreme Court (case sign: III CZP 54/21). The date of case review has not been specified yet.The Supreme Court was also presented with the issue of whether the loan agreement is a mutual agreement in the light of the regulations concerning retention right.On 8 December 2020, Mr. Jacek Jastrz\u0119bski, the Chairman of the Polish Financial Supervision Authority (\u2018PFSA\u2019) proposed a \u2018sector\u2019 solution to address the sector risks related to FX mortgages. The solution would consist in offering by banks to their clients a voluntary possibility of concluding arrangements based on which a client would conclude with the bank a settlement as if his/her loan from the very beginning had been a PLN loan bearing interest at an appropriate WIBOR rate increased by the margin historically employed for such loan.Following that public announcement, the idea was subject of consultations between banks under the auspices of the PFSA and Polish Banking Association. Banks in general have assessed the conditions under which such solution could be implemented and consequent impacts.As expressed in previous financial reports, when that assessment was done, in the view of the Management Board of Bank Millennium, important aspects to take into consideration when deciding on potential implementation of such program were: a) favourable opinion or at least non-objection from important public institutions; b) support from National Bank of Poland to the implementation; c) level of legal certainty of the settlement agreements to be signed with the borrowers; d) level of the financial impact on a pre- and after tax basis; e) capital consequences including regulatory adjustments in the level of capital requirements associated with FX mortgage loans. Based on current information some of the above-mentioned aspects are not likely to be fully clarified and/or achieved. Any decision regarding implementation of such program would require the Management Board to submit it to the Supervisory Board and General Shareholders meeting of Bank Millennium taking into consideration the relevance of such decision and its implications. Despite the fact that not all of those aspects have been possible to clarify, Bank Millennium, in practice, has been using elements of such solution on several individual negotiations with FX mortgage borrowers, including in the course of court proceedings.The effect of the Polish Supreme Court's resolution of 7 May 2021 is that Bank Millennium is entitled to a refund of the cash benefit provided by the bank in performance of a permanently ineffective contract. Taking into account the uncertainty as to the starting point of the limitation period for the bank's claims, Bank Millennium, in order to protect its interests, files lawsuits for payment against borrowers in a court dispute with the bank. Bank Millennium's demand consists of a claim for return of the capital made available to the borrower under the contract and a claim for reimbursement of the equivalent of the benefit obtained by the borrower in connection with the use of the capital made available (equivalent to the financial service). By 31 December 2022, Bank Millennium filed over 3,000 lawsuits against the borrowers. Due to the ongoing proceedings on questions referred for a preliminary ruling (C-520/21, C-756/22) concerning the scope of claims of the parties to an invalid contract, no final decision has yet been issued in Bank Millennium's cases containing a substantive assessment of the Bank's claims for reimbursement of benefits related to the use of capital.Due to the complexity and uncertainty regarding the outcome of court cases, including counter-claims, as well as from potential implementation of KNF Chairman solution or other negotiation solutions or from potential Supreme Court decisions or European Court of Justice decisions, it is difficult to reliably estimate final impacts from different potential outcomes as at the date of publication of the financial statements.", "dimensions": { "concept": "ifrs-full:ExplanationOfAssumptionAboutFutureWithSignificantRiskOfResultingInMaterialAdjustments", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-710": { "value": "Recently issued accounting standards and interpretations that came into force in the
current financial year
At the date of approval of these financial statements, the following accounting standards, interpretations, amendments
and revisions were endorsed by the European Union (EU) with mandatory application for the financial year of the Group
started on 1 January 2022:
Amendment to IFRS 3: Reference to the conceptual framework
This amendment aims to update IFRS 3 so that it corresponds to the conceptual framework of 2018, not occurring
significant changes in the requirements of this standard.
There were no material impacts on the application of this amendment in the Group's financial statements.
Amendment to IAS 16: Property, Plant and Equipment \u2014 Proceeds before intended use
This amendment prohibits an entity from deducting from the cost of a property, plant or equipment any proceeds
arising from the sale of items produced while the entity prepares the asset to operate as intended, at the location and
necessary conditions. The entity shall recognize any proceeds arising from those sales and the respective costs of
production in the income statement.
There were no material impacts on the application of this amendment in the Group's financial statements.
Amendment to IAS 37: Onerous contracts \u2014 Cost of fulfilling a contract
This amendment aims to clarify what costs an entity should consider as related to the fulfilling of a contract when
assessing whether a contract is onerous. It also specifies that the costs of fulfilling a contract correspond only to the
costs directly related to it, which may take the form of incremental costs or of an allocation of other costs directly
related to the fulfilling of the contract.
There were no material impacts on the application of this amendment in the Group's financial statements.
Improvements to international financial reporting standards (cycle 2018-2020)
These improvements comprise the clarification of some aspects related to: IFRS 1 \u2014 First-time adoption of International
Financial Reporting Standards: allows a subsidiary that adopts IFRS for the first time to measure cumulative translation
differences based on the amounts presented in the consolidated financial statements of its parent company, according
to the transition date of the parent company to IFRS; IFRS 9 \u2014 Financial instruments: clarifies that, when assessing the
derecognition of a financial liability, an entity should only consider fees paid or received between the entity and the
lender, including fees paid or received by one on behalf of the other; IFRS 16 \u2014 Leases: amendment to illustrative
example 13 presented in the standard, in order to avoid the emergence of doubts regarding the treatment of lease
incentives; IAS 41 \u2014 Agriculture: removal of the requirement to exclude taxation cash flows when measuring the fair
value of a biological asset, thus ensuring consistency with IFRS 13 \u2014 Fair value measurement.
There were no material impacts on the application of these improvements in the Group's financial statements.
2 -", "dimensions": { "concept": "ifrs-full:DisclosureOfFirstTimeAdoptionExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } }, "f-711": { "value": "Subsequent events
In addition to the aspects disclosed in the other notes and according to the accounting policy 1 Z, the events that
occurred after the date of the financial statements and until the date of its approval, were as follows:
Approval of the application of article 352 (2) of the CRR
On March 24, 2023, BCP was notified of the favourable decision of the supervisory authority on the request for the
application of article 352 (2) of the CRR for the exclusion of the calculation of weighted assets for market risk of
certain structural exchange positions for hedging of regulatory ratios against changes in exchange rates. The change has
an estimated impact on the fully implemented CET1 ratio of around 50 basis points and of around 70 basis points in the
total capital ratio.
Signing of conditional agreement concerning the sale of Millennium Financial Services sp.zo.o.
and strategic insurance cooperation
The Management Board of Bank Millennium S.A. informed that following necessary corporate approvals, on 13 February
2023, Bank Millennium executed the agreement (the \"Agreement\") for the sale of 80% of the shares (the \u201cShares\u201d) in
Millennium Financial Services sp. z o.o. (the \u201cCompany\u201d) to Towarzystwo Ubezpiecze\u0144 na \u017bycie Europa S.A. which
acquires 72% of the Company\u2019s shares and Towarzystwo Ubezpiecze\u0144 Europa S.A. which acquires 8% of the Company\u2019s
shares (collectively the \"Buyers\").
Bank Millennium concluded also with the Buyers and the Company certain agreements concerning exclusive insurance
distribution model, including a cooperation agreement, distribution agreements and agency agreements (the \"Strategic
Insurance Cooperation\"). The Strategic Insurance Cooperation provides for long term (10 years) bancassurance liaison in
relation specified insurance products linked to loans offered by Bank Millennium.\u00a0
The essence of the transaction contemplated by the Agreement is the direct acquisition of the Shares by the Buyers
from Bank Millennium for a pre-defined initial price which may be subject to a price adjustment mechanism after the
Transaction is closed, (i.e. after transfer of legal title to the Shares to the Buyers and payment of the Price, \"Closing\")
and establishment of the Strategic Insurance Cooperation (the \"Transaction\"). If the Transaction will close successfully,
the Bank expects to recognize an upfront pre-tax gain on the transaction of approximately PLN 500 million (Euros 106.8
million).
The Closing of the Transaction is subject to the fulfilment of a condition precedent \u2013 obtaining the relevant consent of
the relevant antimonopoly authority (the \"Condition\").
Bank Millennium will publish information on the fulfilment or non-fulfilment of the Condition in relevant current
reports. The Parties may also withdraw from the Agreement in certain situations indicated therein and penalties may
apply in case of failure of one of the Parties to fulfil its obligations under the Transaction documentation.
The Transaction documentation contains a certain catalogue of representations and warranties from Bank Millennium
and the Buyers with respect to the Shares and Strategic Insurance Cooperation, as well as sets out the principles of the
Parties' liability thereunder.
", "dimensions": { "concept": "ifrs-full:DisclosureOfEventsAfterReportingPeriodExplanatory", "language": "en", "entity": "scheme:JU1U6S0DG9YLT7N8ZV32", "period": "2022-01-01T00:00:00/2023-01-01T00:00:00" } } } }