Current Report No. 4/2022Subject:Event affecting the financials results of Bank Handlowy w Warszawie S.A.in the fourth quarter of 2021

Legal basis:Art.17 of the Regulation (EU) No 596/2014 of the European Parliament and ofthe Council of 16 April 2014 on market abuse (MAR).

Bank Handlowy w Warszawie S.A.("the Bank"), announces that on February 22, 2022 Bank received a letterfrom the President of the Office of Competition and Consumer Protection(UOKiK) specifying further expectations regarding the settlement ofcommissions for early repayment of selected products granted to retailcustomers.

As for now, the Bank has beenreimbursing commissions using the "linear method" to all consumers whorepaid their consumer loans before the contractual deadline, and theloans had been granted starting from entry into force of the Act ofconsumer loans dated 12 May 2011, i.e. after 11 December 2011. TheBank's practice has been the subject of UOKiK proceedings since November2020, ended with the issue of commitment decision by UOKiK in May 2021,after the Bank has submitted satisfactory obligations to the regulatorto change the practise. The decision has been executed in accordancewith its content and the time limits contained therein.

After the decision was issued,UOKiK asked the Bank to provide explanations regarding the method ofreimbursement by the Bank of a proportional part of the commission inthe event that the consumer takes another loan from the Bank in such away that it replaces the original contract (_quot;Increase Agreement_quot;). Inresponse, the Bank explained that such a situation should be assessed asan increase in the existing credit obligation, which does not result inthe obligation to settle the previous loan: the purpose of such aprocedure is not to repay, but to change the previous legal relationshipin such a way that the consumer's credit obligation towards the Bankincreases and is repaid under new rules, the economic goal is the desireto obtain additional funds or change the rules of debt repayment. At thesame time, the Bank charges a correspondingly lower commission forconcluding a new agreement, which in economic terms applies only to thenewly available part of the loan.

In view of the doubts expressedby the President of UOKiK as to the approach, the Bank - emphasizing thewill to cooperate with the President of UOKiK and in order to clarifyany doubts - despite a different factual and legal assessment of theIncrease agreement, for the purpose of reimbursement of commissions,adopted the date of the Increase agreement as the date of earlyrepayment of the previous commitment. The Bank declared and implementedthe new approach for the Increase agreement concluded from 31 January2022. At the same time, in line with declaration submitted to thePresident of UOKiK, the Bank adopted the approach resulting from thedecision also to the Increase agreements. As a consequence, the Bankexamines complaints and also took actions toward ending court disputesregarding the settlement of increase cases in which the parties areconsumers and informing customers accordingly.

Therefore, the Bank adjusted itscommission reimbursement practices to the previously described decisionand communication with the President of UOKiK.

In a letter of February 22, 2022,the President of the Office of Competition and Consumer Protection(UOKiK) informed the Bank about the expectation of additional, proactiveaction by the Bank in relation to customers who concluded IncreaseAgreements after September 11, 2019.

The Bank does not share theassessments presented in the above letter by the President of UOKiK,considering that the Bank's practice did not damage the interest ofconsumers and complied with the applicable standards. However, afterconducting an internal analysis, taking into account relations withclients and emphasizing the will to cooperate with UOKiK in the bestpossible way, the Bank decided to adjust the practice to the position ofthe President of UOKiK expressed in the letter received.

Therefore, in accordance with theapplicable accounting standards, the Bank adjusted its estimates ofprovisions, which resulted in the increase by PLN 37 million, which willbe charged to the Bank's financial results in the fourth quarter of 2021in other operating expenses line.