Abak Spolka Akcyjna

Legal Proceedings Report • Dec 21, 2023

Costs of legal risk related to foreign currency loans

TheManagement Board of mBank S.A. (_quot;Bank_quot;) informs that in connection withthe decision taken on December 21, 2023 by the Bank, the costs of legalrisk related to loans indexed to foreign currencies recognized in Q42023, amounted to PLN 1208.5 million. These are mainly due to theupdated cost of the settlement program, the projected distribution ofcourt verdicts and amendments of other model and market parameters.

TheBank informs that the estimated preliminary net result for Q4 2023 willbe either positive or around zero. At the same time, the Bank informsthat in Q4 2023, positive results in the core business continued.Assuming no other negative unforeseen events, the expected net resultfor 2023 will be either positive or around zero.

ThemBank Group Tier 1 Capital Ratio and the Total Capital Ratio for Q4 2023are expected to be somewhat lower than those reported for Q3 2023. Atthe same time, with reference to the current report No. 73/2023 dated 20December 2023, consolidated capital requirements for mBank Group havebeen reduced by the Polish Financial Supervision Authority by 0.89 p.p.for the Tier 1 Capital Ratio and 1.18 p.p. for the Total Capital Ratiodue to the expiry of the additional capital requirement related to riskof foreign currency mortgage loans for households. Current consolidatedcapital requirements for mBank Group amount to 9.15% for the Tier 1capital ratio and 11.15% for the Total Capital Ratio. Thus, thesurpluses above the capital requirements for Q4 2023 are expected to besimilar to the levels reported for Q3 2023, when they amounted to 4.6p.p. over Tier 1 Capital Ratio and Total Capital Ratio. The liquidityratios significantly exceed the regulatory requirements.