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- Financial notes
- 71. Notes to the consolidated cash flow statement
71. Notes to the consolidated cash flow statement
Cash and cash equivalents
Accounting policies
Cash and cash equivalents consist of cash in hand, cash on nostro accounts and a deposit with the National Bank of Poland, as well as amounts due from banks in the current account, and cash equivalents with maturities up to 3 months from the date of acquisition.
Financial information
| CASH AND CASH EQUIVALENTS | 2023 | 2022 |
|---|---|---|
| Cash, current account with the Central Bank | 14,061 | 11,966 |
| Deposits with the Central Bank | 3,752 | 3,951 |
| Current amounts due from banks | 13,479 | 15,589 |
| Restricted cash and cash equivalents of which | 36 | 489 |
| – amounts due from banks | 5 | 454 |
| – loans and advances to customers | 31 | 35 |
| Total | 31,328 | 31,995 |
Restricted cash and cash equivalents
Cash and cash equivalents of PLN 36 million (as at 31 December 2022: PLN 489 million), including:
- PLN 31 million (as at 31 December 2022: PLN 35 million) pledged as collateral for securities’ transactions conducted by Biuro Maklerskie PKO BP are deposited in the National Depository for Securities (KDPW_CCP), as part of the Guarantee Fund for the Settlement of Stock Exchange Transactions. Each direct participant who holds the status of settlement-making participant is obliged to make payments to the settlement fund which guarantees a proper settlement of the stock exchange transactions covered by that fund. The amount of the payments depends on the value of transactions made by each participant and is updated by KDPW_CCP on a daily basis.
- PLN 5 million (as at 31 December 2022: PLN 4 million) paid in by participants in IKE, IKZE, PPE and PSO, which was not converted by the transfer agent into investment fund participation units by 31 December 2023 and 31 December 2022, respectively,
- PLN 0 million (as at 31 December 2022: PLN 450 million) pledged as collateral for securitization transactions. For detailed information see the note “Information on securitization of the lease portfolio and package sale of receivables”.
Cash flows from interest and dividends, both received and paid
| INTEREST INCOME ON: | 2023 | 2022 |
|---|---|---|
| loans to and other receivables from banks | 2,114 | 1,443 |
| debt securities | 6,604 | 3,745 |
| loans and advances to customers | 19,728 | 14,554 |
| Total | 28,446 | 19,742 |
The above amounts of interest received do not include the amounts of commission recognized using the effective interest rate as interest income.
| INTEREST EXPENSES – PAID: | 2023 | 2022 |
|---|---|---|
| amounts due to banks | (89) | (127) |
| amounts due to customers | (7,113) | (2,863) |
| loans and advances received | (61) | (35) |
| leases | (35) | (19) |
| hedging derivatives | (4,108) | (2,616) |
| debt securities | (158) | (89) |
| issues of securities | (455) | (447) |
| subordinated liabilities | (235) | (99) |
| Total | (12,254) | (6,295) |
| DIVIDEND INCOME RECEIVED | 2023 | 2022 |
|---|---|---|
| from financial assets held for trading | 1 | 1 |
| financial instruments not held for trading, measured at fair value through profit or loss | 13 | 50 |
| Total | 14 | 51 |
Cash flows from operating activities – other adjustments
| OTHER ADJUSTMENTS | 2023 | 2022 |
|---|---|---|
| Cash flow hedges and hedges of a net investment in a foreign operation | 4,146 | (1,901) |
| Actuarial gains and losses | (4) | (9) |
| Currency translation differences on foreign operations | (124) | (87) |
| Remeasurement of shares in subordinated entities and other changes | (31) | (18) |
| Scrapping of property, plant and equipment and intangible assets | (387) | (11) |
| Other changes | (420) | 138 |
| Total | 3,180 | (1,888) |
Explanation of differences between the consolidated statement of financial position and changes in these items presented under operating activities in the consolidated cash flow statement
| (GAINS)/LOSSES ON INVESTING ACTIVITIES | 2023 | 2022 |
|---|---|---|
| Gains on sale and scrapping of property, plant and equipment, intangible assets and assets held for sale | (95) | (108) |
| Losses on sale and scrapping of property, plant and equipment, intangible assets and assets held for sale | 8 | 11 |
| Total | (87) | (97) |
| Analytics for „Interest and dividends received” and „Interest paid” in cash flow from operating activities | 2023 | 2022 |
|---|---|---|
| Reported under investing activities: | (6,549) | (3,758) |
| from financial assets held for trading | (1) | (1) |
| dividends received from securities not held for trading, measured at fair value through profit or loss | (13) | (50) |
| interest received on securities measured at fair value through other comprehensive income | (4 396) | (1,987) |
| interest received on securities measured at amortized cost | (2,139) | (1,720) |
| Reported under financing activities: | 751 | 581 |
| interest paid on debt securities in issue | 455 | 447 |
| interest paid on subordinated liabilities | 235 | 99 |
| interest paid on loans and advances received | 61 | 35 |
| Total | (5,798) | (3,177) |
| CHANGES IN AMOUNTS DUE FROM BANKS | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | 1,663 | (7,091) |
| Changes in allowances for expected credit losses | (7) | (2) |
| Exclusion of the change in cash and cash equivalents | (2,561) | 6,880 |
| Total | (905) | (213) |
| CHANGE IN SECURITIES | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | (61,852) | (192) |
| Changes in allowances for expected credit losses | (4) | 40 |
| Fair value of financial assets measured at fair value through other comprehensive income | 2,995 | (2,072) |
| Recognition of acquisition / disposal of securities measured at fair value through other comprehensive income in investing activities | 35,839 | 3,258 |
| Recognition of acquisition / disposal of securities measured at amortized cost in investing activities | 16,740 | (5,312) |
| Other inflows from investing activities | (78) | (10) |
| Total | (6,360) | (4,288) |
| CHANGE IN LOANS AND ADVANCES TO CUSTOMERS | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | (12,817) | 2,736 |
| Changes in allowances for expected credit losses | (461) | (1,060) |
| Exclusion of the change in cash and cash equivalents | (4) | 10 |
| Total | (13,282) | 1,686 |
| CHANGE IN NON-CURRENT ASSETS HELD FOR SALE | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | (9) | 8 |
| Changes in impairment losses on non-current assets held for sale | 1 | – |
| Total | (8) | 8 |
| CHANGE IN OTHER ASSETS | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | 371 | (199) |
| Changes in impairment losses on other assets and inventory write-downs | (11) | (17) |
| Total | 360 | (216) |
| CHANGE IN LIABILITIES IN RESPECT OF LOANS AND ADVANCES RECEIVED | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | (805) | (167) |
| Recognition of drawing/repayment of long-term loans and advances under financing activities, including interest | 1 140 | 132 |
| Total | 335 | (35) |
| CHANGE IN LIABILITIES IN RESPECT OF SECURITIES IN ISSUE | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | 1,691 | (8,362) |
| Recognition of drawing/repayment of liabilities in respect of debt securities in issue under financing activities | (2,191) | 9,104 |
| Total | (500) | 742 |
| CHANGE IN ACCUMULATED ALLOWANCES FOR EXPECTED CREDIT LOSSES AND IMPAIRMENT LOSSES ON NON-FINANCIAL AND OTHER ASSETS | 2023 | 2022 |
|---|---|---|
| Change in accumulated allowances and provisions for expected credit losses | 381 | 1,191 |
| for amounts due from banks | 7 | 2 |
| for loans and advances to customers | 461 | 1,059 |
| for securities | 4 | (39) |
| for other financial assets | (10) | 11 |
| provisions for financial liabilities and guarantees granted | (81) | 158 |
| Change in accumulated impairment losses on non-financial assets and other provisions | 2,222 | 270 |
| on non-current assets held for sale | (1) | – |
| on property, plant and equipment | 33 | 2 |
| on intangible assets | – | (13) |
| on investments in subordinated entities | 11 | – |
| on other non-financial assets | 21 | 7 |
| other provisions | 2,158 | 274 |
| Total | 2,603 | 1,461 |
| CHANGE IN OTHER LIABILITIES | 2023 | 2022 |
|---|---|---|
| Change resulting from the balance sheet items | 3,996 | 1,650 |
| Adjustment to exclude dividends | (1,600) | – |
| Recognition of lease payments in financing activities | 266 | 255 |
| Total | 2,662 | 1,905 |
| CHANGE IN LEASING LIABILITIES | 2023 | 2022 |
|---|---|---|
| Opening balance | 896 | 959 |
| Changes recorded in operating activities: | 458 | 192 |
| – new agreements | 318 | 49 |
| – closing of agreements | (8) | (11) |
| – modifications | 155 | 136 |
| – interest | 33 | 16 |
| – foreign exchange differences | (40) | 2 |
| Recognition of lease payments in financing activities | (266) | (255) |
| Closing balance | 1,088 | 896 |
Reconciliation of items presented in the consolidated statements of financial position with financing activities in the consolidated cash flow statement
| 2023 | As at the beginning of the period | Recognized in financing activities in the cash flow statement | Presented in operating activities in the cash flow statement (including: interest accrued, foreign exchange differences and other) | As at the end of the period | |
| Incurred | Repaid | ||||
| Loans and advances received | 2,294 | 12 | (1,152) | 335 | 1,489 |
| from banks | 309 | – | (306) | (3) | – |
| from customers | 1,985 | 12 | (846) | 338 | 1,489 |
| Securities in issue | 15,510 | 13,105 | (10,914) | (500) | 17,201 |
| Subordinated liabilities – subordinated bonds | 2,781 | – | – | (7) | 2,774 |
| Payment of lease liabilities | 896 | 506 | (266) | (48) | 1,088 |
| Total | 21,481 | 13,623 | (12,332) | (220) | 22,552 |
| 2022 | As at the beginning of the period | Recognized in financing activities in the cash flow statement | Recognized in operating activities in the cash flow statement other changes (interest, foreign exchange differences and other) |
As at the end of the period | |
| Incurred | Repaid | ||||
| Loans and advances received | 2,461 | 620 | (753) | (34) | 2,294 |
| from banks | 740 | 151 | (516) | (66) | 309 |
| from customers | 1,721 | 469 | (237) | 32 | 1,985 |
| Securities in issue | 23,872 | 8,421 | (17,525) | 742 | 15,510 |
| Subordinated liabilities – subordinated bonds | 2,716 | – | – | 65 | 2,781 |
| Payment of lease liabilities | 959 | – | (255) | 192 | 896 |
| Total | 30,008 | 9,041 | (18,533) | 965 | 21,481 |
Other investment inflows include dividend proceeds and proceeds from the sale of equity securities. Other investment expenditure includes purchases of equity securities.
In 2023, under „other inflows from investing activities”, the Group presents the effect of the sale of series A VISA shares in the amount of PLN 78 million. In 2022, in the item „other investment expenditure”, the Group presents the effect of the purchase of PKN ORLEN shares in the amount of PLN 707 million and in the item „other investment inflows” the effect of the sale of these shares in the amount of PLN 715 million. On 29 September 2022, the Group acquired 14,161,080 PKN ORLEN S.A. bearer shares from the State Treasury – Minister of State Assets for a price equal to the result of the multiplication of the number of shares and the price of one share in accordance with the closing price of PKN ORLEN S.A. shares on the main market of the Warsaw Stock Exchange on the date of conclusion of the agreement decreased by the discount determined on market terms. On 30 September 2022, the Group concluded a total return swap with PKN ORLEN S.A. for a period of 1 month, where the underlying instrument were acquired shares. PKN ORLEN S.A. made a cash deposit to the Group as collateral for the receivables, which was subject to interest at market conditions. On 18 October 2022, the Group disposed of all shares in PKN ORLEN S.A. The sale took place under the accelerated bookbuilding (ABB) formula.
Dividends received are also included in other investment income