Annual Report 2021

Fio banka, a.s.

Table of Contents

I. General Part

II. Auditor’s Report

III. Financial Statements for the Year Ended 31 December 2021

IV. Information on Capital

V. Report on Relations

Table of Contents 2
I
General Part

General Part 3
Introduction

Dear Sirs and Madams,

Let me reflect on another elapsed year together with you.

Although 2021 repeatedly saw measures relating to the
coronavirus pandemic, it was a successful year for the Bank. We
managed to further expand our offer to include new products and
improve the existing services and we worked on several
significant projects. We were rewarded by an unceasing inflow
of clients and a record profit that exceeded CZK 2 billion.

We witnessed (not passively) further progress in the approach

of clients to finances and related trends accelerated by the
pandemic. I would like to mention the continued move
of common financial transactions to the online environment,
a mortgage boom, and a more massive inclination of the
population to investment products arising from the accumulation
of savings during the pandemic, and particularly an increasingly
resonating topic of inflation.

The first half of the year was affected by lockdown, which

fortunately did not have a dramatic impact on the financial
services sector. Although the branches were open, the already mentioned transfer of interest to digital
channels continued. For this reason, we focused on providing additional options for opening and
administrating accounts remotely in order to satisfy clients who prefer online access. For example the
possibility to open an account in a simple manner in a mobile phone clearly contributed to the growth in
the number of clients who opened their accounts online.

However, branches continue to be an important communication channel and we do not plan to reduce
the number of points of sale. On the contrary, we add new ones when needed and we modernise
the existing ones. As part of a “contactless” account handling, we installed further deposit ATMs to
branches; overall, more than 80% of Czech branches currently have cash deposit machines. We also
consider it an important competitive advantage that all our branches keep their cash desks. As
a result, clients can make cash transactions if needed through these cash desks, which is important
primarily for businessmen and companies.

I can present business results for the past year with pride and joy. The balance sheet total of Fio banka
increased year-on-year by one fifth and amounted to CZK 214.7 billion. The volume of deposits
increased at a similar pace and loans were also successful, up by more than 40% year-on-year. In total,
Fio banka had more than 1,160,000 clients at the end of the year, which is a respectable figure. The net
profit of CZK 2.3 billion is a record profit in the history of Fio banka and is almost double in the year-on-
year comparison. In addition, we exceeded one billion profit for the fourth year in a row. We see these
figures as a confirmation that our concept of a gradual and meaningful development works well and we
are heading in the right direction.

In total, our services attracted 90 thousand new clients, one fifth of them additionally opened an account
intended for investments. The popularity of investment services significantly increased predominantly in
the last months of the past year when increased inflation attracted newly interested persons. The fast
year-on-year growth of interbank rates by which the Czech National Bank responded to the increasing
inflation rate significantly impacted the end of the year on the banking market.

Fio funds managed by Fio investiční společnost saw record growth. At the beginning of 2021, we made
investments in EUR available in the global fund which is important primarily for the clients in Slovakia.
The sales of Fio funds increased year-on-year by 220%, the volume of managed funds exceeded
CZK 1 billion. The funds are an affordable and comprehensible investment instrument for the clients,
which does not require in-depth knowledge or day-to-day active monitoring of the capital market, and
we see in the new year that the interest in these funds continues to grow. The number of individual

General Part 4
investors increased likewise, which was also due to the historically first issue of our own bonds that we
offered at the end of the year and sold out in only 13 business days.

One of the key topics of 2021 was the record demand for housing. Mortgages saw an unprecedented
interest thanks to low interest rates; the interest slowly faded away in the last months of the year in
relation to the increase in the rates. The volume of provided Fio mortgages increased by more than half
in comparison with the prior year which also exceeded previous highs.

As to important projects that we completed in the past year, I would like to emphasise, in addition to the
foregoing, the expansion of the offer of loans by traditional instalment consumer loans in the Czech
Republic which were lacking in our product portfolio. Further, we introduced unique tools for setting the
required level of security for payment cards or the already mentioned Fio bonds issued primarily
for Fio banka to meet the new regulatory requirements for capital and eligible liabilities (MREL)
determined for banking institutions in the EU.

In 2022, we want to make bank identity (Bank ID) available to Czech clients as an instrument for
electronic identification of citizens or, for example, for investments through a real estate fund that will
allow the clients to participate in a long-term real estate appreciation. We want to repeatedly pay
attention to our applications, both banking and non-banking. As part of a maximum simplification of
services, we are preparing, together with the Czech Banking Association, a new payment service that
will allow sending money without knowing the bank account number to the recipient's mobile phone.

We are naturally planning further development also in Slovakia where Fio banka has been operating for
a long time. The interest in our services on this market, which is close to us in terms of geography and
history, increases every year. Further, we want to boost the position and awareness of the Fio banka
brand here, slightly strengthen the branch network and focus on supplementing the offer to include
instalment loans, development of services provided online and further improvements.

As you see, we do not intend to be idle in the following year and we want to do everything to be an even
better partner for you in the world of finance . I want to sincerely thank our clients, employees,
shareholders and business partners for their current loyalty and trust and wish them a successful year
2022 with the lowest number of obstacles and restrictions.

/J

/i
Chairman

General Part
A. Principal Information
Name of the Company: Fio banka, a.s. (hereinafter the “Company”, “Fio banka” or the “Bank”)
Registered office: V Celnici 1028/10, 117 21 Prague 1
Corporate ID: 618 58 374

B. Information on Shares, Share Capital, Shareholders and Subsidiaries

- The Company’s registered capital amounting to CZK 760,000 thousand is divided into 760,000
of ordinary book-entry registered shares (ISIN: CZ0008034246) with a nominal value
of CZK 1,000.
- Transferability of the shares is not restricted; the shares may be transferred based on share
transfer agreements.
- The shares entail rights as provided for in legislation and the statutes; no other rights or
preferential rights are attached to the shares.
- The shares are not listed on any regulated market.
- As of 31 December 2021, the Company had a sole shareholder – Fio holding, a.s., corporate
ID: 60192763, Prague 1, V Celnici 1028/10, Postal Code: 117 21.
- No dividends were paid in the past eleven years.
- The Company or any entity in which the Company has a direct or indirect equity interest
exceeding 50% of the share capital or voting rights own no shares of the Company.
- As of 31 December 2021, the Company had the following subsidiaries: RM-SYSTÉM, česká
burza cenných papírů a.s., Corporate ID: 47116404, V Celnici 1028/10, Postal Code: 117 21,
Czech Republic, RM-S FINANCE, s.r.o., Corporate ID: 62915240, V Celnici 1028/10, Postal
Code: 117 21, Czech Republic (with the following subsidiaries: Fio Slovakia, a.s., Corporate ID:
35828137, Nám. SNP 21, Bratislava 811 01, Slovakia, and Fio leasing, a.s., Corporate ID:
61860841, V Celnici 1028/10, Postal Code: 117 21), Fio forexová, s.r.o., Corporate ID: 27589587,
V Celnici 1028/10, Postal Code: 117 21, Czech republic, Fio Consulting, spol. s.r.o., Corporate
ID: 25740334, V Celnici 1028/10, Postal Code: 117 21, Czech Republic, Fio investiční
společnost, a.s., Corporate ID: 06704441, V Celnici 1028/10, Postal Code: 117 21 and Fio realitní
fond SICAV, a.s., Corporate ID: 14052628, V Celnici 1028/10, Postal Code: 117 21.

C. Information on Activity
Business authorisation:
- The Ministry of Finance of the Czech Republic dated 15 August 1994, ref. no. 102/38 536/94;
- Decision of the Czech Securities Commission dated 18 June 1999, ref. no. 521/1388-k/99, whereby
the authorisation granted by the Ministry of Finance of the Czech Republic on 15 August 1994,
ref. no. 102/38 536/94, continued to be fully effective;
- Certification concerning the scope of the securities trading authorisation issued on 25 January 2001,
ref. no. 43/Z/19/2001, by the Czech Securities Commission under Article II Transitory Provisions,
Subparagraph 9 of Act No. 362/2000 Coll.;
- Decision of the Czech Securities Commission of 10 February 2004, ref. no.: 43/N/226/2003/1 –
extension of the business authorisation;
- Decision of the Czech National Bank of 31 August 2006, ref. no.: 43/N/158/2005/6, 2006/7096/540
– extending the business authorisation to include derivatives trading; and
- Decision of the Czech National Bank of 5 May 2010, ref. no. 2010/4201/570 – granting a banking
licence.
Commencement of operation: 31 August 1994
Information on the Company’s Formation, its Participation and Principal Business Activity:
Fio banka, a.s. was formed by a single Memorandum of Association on 20 June 1994 (under the former
name Fio, burzovní společnost, a.s.) and was incorporated following its registration in the Register
of Companies in Prague on 31 August 1994. Since 15 March 1995, the Company has been
a shareholder of Burza cenných papírů Prague, a.s. As of 31 December 2019, the Bank owned
100 registered shares of Burza cenných papírů Prague, a.s. in the certificate form with a nominal value
of CZK 1,000. On 20 February 1995, the Company obtained membership in Burza cenných papírů
Prague, a.s., starting its trading activity there in April 1995.

General Part 6
In line with a decision of the Czech Securities Commission of 10 February 2004, ref. no.:
43/N/226/2003/1, and with regard to the decision of the Czech Securities Commission, ref. no.:
512/1388-k/99 of 18 June 1999, the extent of the authorisation to perform securities trading granted to
Fio, burzovní společnost, a.s. (Fio banka, a.s. at present) was as follows since 11 March 2004:

- Provision of principal investment services under Section 4 (2) (a), (b), (c), (d), (e) of Act
No. 256/2004 Coll., the Capital Market Undertaking Act (hereinafter the “Act”), in respect of
investment instruments as defined in Section 3 (1) (a), (b) of the Act; and
- Provision of additional investment services under Section 4 (3) (a), (b), (c), (e) of the Act, in respect
of investment instruments as defined in Section 3 (1) (a), (b) of the Act, and additional investment
services under Section 4 (3) (d), (f) of the Act, in respect of investment instruments as defined in
Section 3 (1) (a), (b), (c), (d) of the Act.

In line with a decision of the Czech National Bank of 31 August 2006, ref. no. 43/N/158/2005/6,
2006/7096/540, the extent of the authorisation to perform securities trading granted to Fio, burzovní
společnost, a.s. (Fio banka, a.s. at present) was as follows since 12 September 2006:

I. Principal investment activities under Section 4 (2) of the Act:

a) Receipt and provision of instructions relating to investment instruments (Section 4 (2) (a)
of the Act);
b) Performance of instructions relating to investment instruments to a customer’s account
(Section 4 (2) (b) of the Act);
c) Proprietary trading with investment instruments (Section 4 (2) (c) of the Act);
d) Discretionary management of individual portfolios under a contractual arrangement with
the client if this portfolio includes defined investment instruments (Section 4 (2) (d) of the
Act);
e) Investment advisory concerning investment tools (Section 4 (2) (e) of the Act);
f) Underwriting of investment instruments or their placement with the subscription obligation
(Section 4 (2) (g) of the Act); and
g) Placement of investment instruments without the subscription obligation (Section 4 (2)
(h) of the Act).

II. Additional investment activities under Section 4 (3) of the Act:

a) Custody and administration of investment tools including related services (Section 4 (3)
(a) of the Act);
b) Provision of loans or borrowings to clients so as to facilitate trading with the investment
tool in which the loan or borrowing provider participates (Section 4 (3) (b) of the Act);
c) Provision of advisory services related to the capital structure, industrial strategies and
related issues, as well as provision of advisory services and services related to the
transformation or transfers of companies (Section 4 (3) (c) of the Act);
d) Provision of investment recommendation and analyses of investment opportunities or
similar general recommendation related to investment tool trading (Section 4 (3) (d)
of the Act); and
e) Execution of foreign exchange operations related to the provision of investment services
(Section 4 (3) (e) of the Act).

The provision of investment services under art. I., a) through c) and e) relates to investment instruments
in line with Section 3 (1) (a), (b), (d) through (k) of the Capital Market Undertaking Act, ie investment
securities, collective investment securities and derivatives. The provision of investment services under
art. I., d), g) and h) relates to investment instruments in line with Section 3 (1) (a), (b) of the Capital
Market Undertaking Act, ie investment securities and collective investment securities.

The provision of investment services under art. II., b) relates to investment instruments in line with
Section 3 (1) (a) and (b) of the Capital Market Undertaking Act, ie investment securities and collective
investment securities. The provision of investment services under art. II., a) and d) relates to investment
instruments in line with Section 3 (1) (a), (b), (d) through (k) of the Capital Market Undertaking Act, ie
investment securities, collective investment securities and derivatives.

General Part 7
In line with a decision of the Czech National Bank of 5 May 2010, ref.no. 2010/4201/570, the extent
of the authorisation to perform securities trading granted to Fio banka, a.s. has been as follows since
5 May 2010:

- Undertaking the activities listed in Section 1 (1) of the Banking Act as follows:

a) Acceptance of deposits from the general public;

b) Extension of credit,

- Undertaking the activities listed in Section 1 (3) of the Banking Act as follows:

a) Investing in securities on the Company’s own account;

b) Finance lease;
c) Payments and clearing;
d) Issuance and administration of payment facilities, eg credit cards and traveller’s cheques;
e) Issuance of guarantees;
f) Opening of letters of credit;
g) Collection services; and
h) Provision of investment services within the scope of principal investment services

Within the scope of principal investment services

- Under Section 4 (2) (a) of the Capital Market Undertaking Act No. 256/2004 Coll., as amended
(hereinafter referred to as the “Capital Market Undertaking Act”), receipt and provision
of instructions relating to investment instruments, in respect of investment instruments as defined in
Section 3 (1) (a), (b) and (d) through (k) of the Capital Market Undertaking Act;

- Under Section 4 (2) (b) of the Capital Market Undertaking Act, performance of instructions relating
to investment instruments to a customer’s account, in respect of investment instruments as defined
in Section 3 (1) (a), (b) and (d) through (k) of the Capital Market Undertaking Act;

- Under Section 4 (2) (c) of the Capital Market Undertaking Act, proprietary trading with investment
instruments, in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through
(k) of the Capital Market Undertaking Act;

- Under Section 4 (2) (d) of the Capital Market Undertaking Act, discretionary management
of individual portfolios under a contractual arrangement with the client if this portfolio includes
defined investment instruments, in respect of investment instruments as defined in Section 3 (1) (a),
(b) of the Capital Market Undertaking Act;

- Under Section 4 (2) (e) of the Capital Market Undertaking Act, investment advisory concerning
investment tools, in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d)
through (k) of the Capital Market Undertaking Act;

- Under Section 4 (2) (g) of the Capital Market Undertaking Act, underwriting of investment
instruments or their placement with the subscription obligation, in respect of investment instruments
as defined in Section 3 (1) (a), (b) of the Capital Market Undertaking Act;

- Under Section 4 (2) (h) of the Capital Market Undertaking Act, placement of investment instruments
without the subscription obligation, in respect of investment instruments as defined in Section 3 (1)
(a), (b) of the Capital Market Undertaking Act;

and within the scope of additional investment services

- Under Section 4 (3) (a) of the Capital Market Undertaking Act, custody and administration
of investment tools including related services, in respect of investment instruments as defined
in Section 3 (1) (a), (b) and (d) through (k) of the Capital Market Undertaking Act;

- Under Section 4 (3) (b) of the Capital Market Undertaking Act, provision of loans or borrowings to
clients so as to facilitate trading with the investment tool in which the loan or borrowing provider

General Part 8
 participates, in respect of investment instruments as defined in Section 3 (1) (a), (b) of the Capital
Market Undertaking Act;

- Under Section 4 (3) (c) of the Capital Market Undertaking Act, provision of advisory services related
to the capital structure, industrial strategies and related issues, as well as provision of advisory
services and services related to the transformation or transfers of companies;

- Under Section 4 (3) (d) of the Capital Market Undertaking Act, provision of investment
recommendation and analyses of investment opportunities or similar general recommendation
related to investment tool trading, in respect of investment instruments as defined in Section 3 (1)
(a), (b) and (d) through (k) of the Capital Market Undertaking Act;

- Under Section 4 (3) (e) of the Capital Market Undertaking Act, execution of foreign exchange
operations related to the provision of investment services;

i) Financial brokerage;
k) Foreign exchange services;
l) Provision of banking information;
m) Proprietary trading or trading on a client’s account with foreign currencies and gold;
n) Rental of safe-deposit boxes; and
o) Activities that directly relate to the activities in the banking licence.

D. Report on the Company’s Business Activity and Assets

Assessment of retail banking:

The year 2021 was successful for Fio banka in many respects. The net profit amounted
to CZK 2.3 billion which is a 92% year-on-year increase and exceeded the previous record result
of 2019. The number of new clients slightly increased year-on-year and their total number was 1,162,000
at the end of the year. The balance sheet total increased by 18% year-on-year and amounted
to CZK 214.7 billion, the volume of deposits increased by 16% to CZK 203.4 billion.

In 2021, Fio banka attracted more than 90 thousand new clients of which 75 thousand thanks to its
flagship product, fee-free current account. In acquisitions, the trend of opening accounts online
continues, the number of accounts opened in this manner increased year-on-year by more than 40%.
We promoted this trend in the first quarter by making available the possibility to open an account in
a mobile application, which was used by approximately half of online clients.

We made other services available online, such as transfer of clients from another bank or the widest
options of security for payment cards on the market. New advantages were provided by Visa cards
where we offered unlimited ATM withdrawals free of charge anywhere in the world. Businessmen
welcomed the modernisation in acceptance of payment cards in POS terminals and the payment
gateway.

We paid great attention to the development of the Fio Smartbanking mobile banking application to which
we continuously add other services to make it a full-fledged version of the internet banking. The number
of clients who use the application is growing fast, by 55% year-on-year. As part of the support for
handling standard tasks online, we worked on the implementation of bank identity (Bank ID) in the past
year, we will make it operational shortly.

In addition to strengthening online channels, there was the continuing trend from the past year, the
record high demand for mortgages and relating year-on-year growth in the volume of provided mortgage
loans by more than half. The demand slowly faded away at the end of the year due to an increase in
market interest rates and their subsequent reflection in the price lists of individual banks. In terms of
loans, Fio banka supplemented the offer of its loan products by consumer loans and it was successful
in the expansion of the entire loan portfolio where the volume of provided loans increased year-on-year
by 43%.

General Part 9
Given the change in people’s behaviour and an increased transfer of services to online environment,
we focused primarily on optimisation and modernisation in both branch and ATM network. We opened
three new branches, one in the Czech Republic (Mělník) and two in Slovakia (Humenné, Ružomberok).
Further, we opened another mortgage centre, i.e. a place specialised solely in mortgage loans (Ostrava).
We equipped the branches with ATMs possessing a deposit function, but concurrently we keep cash
desks with physical service. In total, we currently have 224 ATMs and to a great extent they have the
deposit function – more precisely 71 of them, more than double of the last year’s number.

Assessment of investment banking:

The year 2021 brought another record number of new investors to the Bank – one quarter more than in
the previous year which also broke the then record. Every fifth client opened a business account. The
increasing savings and primarily an increasingly resonant topic of inflation brought a wider group of
households to investing and attracted newly interested people. Sales of mutual funds managed
by Fio investiční společnost increased year-on-year by 220% and the managed assets exceeded the
level of CZK 1 billion during the year. We boosted the interest already at the beginning of the year by
opening a EUR class of Fio globální fond and we plan to expand the offer in the future.

The number of shareholders in the global fund amounted to 6,700 which is a year-on-year increase of
99%, 3,800 clients invest in the local fund (year-on-year increase of 60%). The funds attract investors
both to attractive products and their current performance, which is in double digits in both funds. For
2021, the CZK class of the global fund achieved appreciation of 24.1%, its EUR class achieved 21,6%
and the local fund 37,6%.

The traditional pillar of investment services was individual investing where the volumes of trades
amounted to CZK 210 billion. After the previous doubling of the year-on-year volume it is another growth
of 6% as compared to 2020. The largest part of the volume continued to be trading on American markets,
however their share declined to 51% year-on-year (64% of the volume in 2020). The local market
strengthened, it saw 45% of the volume of trades, the remaining 4% were on the German market.

An important milestone came at the end of the year when Fio banka launched a new investment product
on the market – the historically first issue of its own bonds traded on the Czech RM-SYSTÉM stock
exchange. Clients bought out the first tranche for CZK 600 million in only 13 business days. The six-
year bonds with fixed annual interest of 5% and a nominal value of CZK 10 thousand impressed
investors and attracted new ones. In total, the first tranche was distributed among more than
2,500 clients which is an average volume of investment of 21 pieces, i.e. CZK 210 thousand per one
investor.

The annual Investment School, which we have been organising for many years took, place in spite of
the pandemic at least in a restricted scheme. We believe that we will be able to go back to the standard
scope of this popular educational programme in the following year. On the contrary, the Studentbroker
project which helps students at colleges and universities in the Czech and Slovak Republics learn about
trading on the financial markets, followed similar lines as in prior years. In 2021, it was attended by more
than 550 students from nine schools, the students made approximately 20 thousand transactions during
the project in total.

The most important events in 2021

Investing in the global equity fund in EUR
After more than two years of operations, Fio investiční společnost introduced a news in its offer which
made it possible for Czech and Slovak clients to purchase share certificates of the successful Fio global
equity fund also in EUR.

Launch of instalment loans

Fio banka included traditional instalment consumer loans in its portfolio. Clients may use them for
anything between CZK 10 thousand and CZK 6 million, they are free of unnecessary fees and the clients
may apply for them easily online.

General Part 10
Bank identity project
At the beginning of the year, Czech banks agreed to work together on aligning the bank identity standard
with Bankovní identita, a.s. Fio banka started the work on obtaining the certification and implementing
the project in its systems.

Opening an account also from a mobile phone

For the individuals interested in services of Fio banka, the bank introduced a possibility of opening
a new account only using the Fio Smartbanking application – in a fast and simple manner and naturally
free of charge. Interested clients are guided through the process by an intuitive guide and it is therefore
possible to open an account from anywhere in a few minutes.

Widest options for payment card security on the market

Clients of Fio banka got a better control over their payment cards thanks to the possibility to block
selected types of transactions, for example those with poor exchange rates (DCC), by specific country
or trader. These functions contributed to an increase in security, the possibilities of setting are the widest
on the market.

Transfer of an account from other banks online

An online tool was made available to the current clients of Fio banka to close an account in another
bank and transfer the cash balance, standing orders and direct debits directly in Internetbanking.
Fio banka will handle the account closing on behalf of the client.

New design of Smartbanking

In summer, we simplified the look of the mobile application, added the status of limits drawing and
security setting of payment cards. In addition, we added possibilities to customise account overview.
Version 2.5 brought Fio Smartbanking among the best rated applications in Google Play.

Value of assets in Fio funds exceeded CZK 1 billion

The volume of assets managed in Fio funds exceeded CZK 1 billion. The bank achieved this significant
milestone almost exactly 3 years after it started to offer the share certificates of individual funds to
investors.

Fio konto account with interest rate zones

In response to an increase in the Czech National Bank rates, Fio banka introduced a new zone in the
savings account in which the balance is subject to a higher interest rate. An increased interest rate
applies only to one savings account of an individual.

Fio banka offered its own bonds

It took only 13 business days for the clients of Fio banka to buy out the first tranches of the bonds issue
by Fio banka for CZK 600 million. The issue of bonds was intended primarily for retail investors and was
easily available through traditional channels of the bank.

Major awards

In 2021, Fio banka won one Golden and two Silver Crowns in the traditional Golden Crown financial
product competition. The top positions in their respective categories were taken by the business
account, silver goes to fee-free personal account and the e-Broker investment application. Fio business
account has kept winning the Golden Crown survey since 2011 without interruption, this year for the
eleventh time in a row. The other two products are also regularly awarded.

In the Best Bank of 2021 competition organised by Hospodářské noviny, Fio ranked second.
The imaginary silver medal was received in the Financial Product of the Year (for the business
account) and the Broker of the Year competition.

In the independent study by KPMG which focuses on an assessment of customer experience in

companies throughout the Czech Republic, we received the second best evaluation from clients in the
sector of financial services. Overall, Fio banka ranked on respectable 12th position.

General Part 11
Our products were successful also on the Slovak market. Fio business account ranked first in an
independent Zlatá minca 2020 competition. The term deposit of Fio banka ranked third.

Structure of the branch network

Name of the company: Fio banka, a.s.
Corporate ID: 61858374
Registered office: V Celnici 1028/10, 117 21, Prague 1
Branches (as of 31 December 2021) – town, street, postal code, (country), e-mail:
Czech Republic

General Part 12
Beroun, nám. M. Poštové 854, 266 01, beroun@fio.cz
Blansko, nám. Svobody 5, 678 01, blansko@fio.cz
Brno, Gajdošova 4489/26, 615 00, brno.gajdosova@fio.cz
Brno, Joštova 4, 602 00, brno.jostova@fio.cz
Brno, Nové Sady 988/2, 602 00, brno.sady@fio.cz
Brno, Veveří 2581/102, 616 00, brno.veveri@fio.cz
Bruntál, K.Čapka 80/1, 792 01, bruntal@fio.cz
Břeclav, J. Palacha 3152, 690 02, breclav@fio.cz
Česká Lípa, Barvířská 737, 470 01, ceska.lipa@fio.cz
České Budějovice, Dr. Stejskala 110/11, 370 01, české.budejovice@fio.cz
Český Těšín, Štefánikova 20/21, 737 01, cesky.tesin@fio.cz
Děčín, Lázeňská 58/1, 405 02, decin@fio.cz
Frýdek-Místek, Zámecké nám. 42, 738 01, frydek.mistek@fio.cz
Havířov, Hlavní třída 64, 736 01, havirov@fio.cz
Havlíčkův Brod, Dolní 1, 580 01, havlickuv.brod@fio.cz
Hodonín, Národní třída 79, 695 01, hodonin@fio.cz
Hradec Králové, Masarykovo náměstí 511, 500 02, hradec.kralove@fio.cz
Cheb, Svobody 31, 350 02, cheb@fio.cz
Chomutov, náměstí 1. máje 91, 430 01, chomutov@fio.cz
Chrudim, Resselovo náměstí 61, 537 01, chrudim@fio.cz
Jablonec nad Nisou, Dolní náměstí 716/3, 466 01, jablonec.nad.nisou@fio.cz
Jičín, Husova 103, 506 01, jicin@fio.cz
Jihlava, Masarykovo náměstí 20, 586 01, jihlava@fio.cz
Jindřichův Hradec, Růžová 41, 377 01, jindrichuv.hradec@fio.cz
Karlovy Vary, T.G.Masaryka 38, 360 01, karlovy.vary@fio.cz
Karviná- Fryštát, Fryštátská 73/3, 733 01, karvina@fio.cz
Kladno, Suchardova 515, 272 01, kladno@fio.cz
Klatovy, Vídeňská 181, 339 01, klatovy@fio.cz
Kolín, Karlovo náměstí 7, 280 02, kolin@fio.cz
Kroměříž, Dobrovského 170/5, 767 01, kromeriz@fio.cz
Liberec, Pražská 12/15, 460 07, liberec@fio.cz
Litoměřice, Dlouhá 208/16, 412 01, litomerice@fio.cz
Louny, Česká 158, 440 01, louny@fio.cz
Mělník, náměstí Karla IV. 184/16, melnik@fio.cz
Mladá Boleslav, tř. T.G.Masaryka 1455, 293 01, mlada.boleslav@fio.cz
Most, Moskevská 3336, 434 01, most@fio.cz
Náchod, Tyršova 64, 547 01, nachod@fio.cz
Nový Jičín, 28. Října 159/18, 741 01, novy.jicin@fio.cz
Nymburk, Náměstí Přemyslovců 129, 288 02, nymburk@fio.cz
Olomouc, Dolní náměstí 20, 779 00, olomouc.dolni.namesti@fio.cz
Olomouc, Masarykova třída 736/19, 779 00, olomouc.masarykova@fio.cz
Opava, Ostrožná 262/9, 746 01, opava@fio.cz
Ostrava, Hlavní třída 682/110, 708 00, ostrava.hlavni@fio.cz
Ostrava, Nádražní 39, 702 00, ostrava.nadrazni@fio.cz
Ostrava Zábřeh, Výškovická 2526/118, 700 30, ostrava.vyskovicka@fio.cz
Pardubice, Masarykovo náměstí 1544, 530 02, pardubice@fio.cz
Pelhřimov, Dr. Tyrše 58, 393 01, pelhrimov@fio.cz
Písek, Jungmannova 186, 397 01, pisek@fio.cz
Plzeň, Náměstí Generála Piky 2703/27, 326 00, plzen.slovany@fio.cz
Plzeň, Goethova 9/2, 301 00, plzen.goethova@fio.cz
Praha 1, Hybernská 1033/7a, 110 00, praha.hybernska@fio.cz, praha.hypocentrum@fio.cz (Hypoteční
centrum)
Praha 1, Senovážné nám. 24, 116 47, praha.senovazne@fio.cz
Praha 1, Havlíčkova 1028/5, 110 00, praha.millennium@fio.cz
Praha 2, Ječná 37, 120 00, praha.jecna@fio.cz
Praha 3, Táboritská 1782/40, 130 00, praha.taboritska@fio.cz
Praha 4, Budějovická 1523/9a, 140 00, praha.budejovicka@fio.cz
Praha 4, Nuselská 401/4, 140 00, praha.nuselska@fio.cz
Praha 5, Archeologická 2256/1, 155 00, praha.archeologicka@fio.cz
Praha 5, Štefánikova 75/48, 150 00, praha.stefanikova@fio.cz

General Part 13
Praha 6, Dejvická 574/33, 160 00, praha.dejvicka@fio.cz
Praha 6, Křenova 438/3, 162 00, praha.krenova@fio.cz
Praha 8, Klapkova 67/4, 182 00, praha.klapkova@fio.cz
Praha 9, Sokolovská 352/215, 190 00, praha.sokolovska@fio.cz
Praha 10, Moskevská 268/53, 101 00, praha.moskevska@fio.cz
Praha 11, Opatovská 964/18, 149 00, praha.opatovska@fio.cz
Prostějov, Kostelní 6, 796 01, prostejov@fio.cz
Přerov, Palackého 2820/27, 750 02, prerov@fio.cz
Příbram, OC Skalka 1. Patro, Milínská 134, 261 02, pribram@fio.cz
Sokolov, 5. května 163, 356 01, sokolov@fio.cz
Strakonice, Lidická 154, 102, 386 01, strakonice@fio.cz
Svitavy, Náměstí Míru 50/65, 568 02, svitavy@fio.cz
Šumperk, Bulharská 229/1, 787 01, sumperk@fio.cz
Tábor, nám. Fr. Křížka 2840, 390 01, tabor@fio.cz
Teplice, U Radnice 6/2, 415 01, teplice@fio.cz
Trutnov, Krakonošovo náměstí 17, 541 01, trutnov@fio.cz
Třebíč, Jihlavská brána 5/4, 674 01, trebic@fio.cz
Třinec, Nám. Svobody 527, 739 61, trinec@fio.cz
Uherské Hradiště, Havlíčkova 160, 686 01, uherske.hradiste@fio.cz
Ústí nad Labem, Dlouhá 3458/2A (Palác Jordán), 400 01, usti.nad.labem@fio.cz
Ústí nad Orlicí, 17. listopadu 1394, 562 01, usti.nad.orlici@fio.cz
Valašské Meziříčí, Poláškova 36/4, 757 01, valasske.mezirici@fio.cz
Vsetín, Smetanova 810, 755 01, vsetin@fio.cz
Vyškov, Jana Šoupala 17/2, 682 01, vyskov@fio.cz
Zlín, Dlouhá 489, 760 01, zlin@fio.cz
Znojmo, Pražská 1539/7, 669 02, znojmo@fio.cz
Žďár nad Sázavou, Nádražní 1, 591 01, zdar.nad.sazavou@fio.cz
Organisational branch:
Fio banka, a.s., pobočka zahraničnej banky (Slovakia)
Corporate ID No.: 36 869 376, registered office: Dunajská 1, Bratislava 811 08
Offices:
Banská Bystrica, Národná 6, 974 01, banska.bystrica@fio.sk
Bardejov, Radničné námestie 22, 085 01, bardejov@fio.sk
Bratislava, Dunajská 1, 811 08, bratislava@fio.sk
Bratislava, Záhradnícka 74, 821 08, bratislava.zahradnicka@fio.sk
Humenné, Námestie slobody 7, 066 01, humenne@fio.sk
Komárno, Nám. M.R.Štefánika 11, 945 01, komarno@fio.sk
Košice, Hlavná 8, 040 01, kosice@fio.sk
Levice, Sv. Michala 2, 934 01, levice@fio.sk
Liptovský Mikuláš, Námestie Osloboditeľov 7, 031 01, liptovsky.mikulas@fio.sk
Lučenec, T. G. Masaryka 12, 984 01, lucenec@fio.sk
Martin, Divadelná 7, 036 01, martin@fio.sk
Michalovce, Sama Chalupku 2, 071 01, michalovce@fio.sk
Nitra, Štefánikova trieda 27, 949 01, nitra@fio.sk
Nové Zámky, Komárňanská 1/B, 940 02, nove.zamky@fio.sk
Piešťany, Námestie Slobody 13, 921 01, piestany@fio.sk
Poprad, Námestie svätého Egídia 50, 058 01, poprad@fio.sk
Považská Bystrica, Centrum 2304, 017 01, povazska.bystrica@fio.sk
Prešov, Hlavná 45, 080 01, presov@fio.sk
Prievidza, Š. Moyzesa 10, 971 01, prievidza@fio.sk
Ružomberok, Maroša Madačova 1A, 034 01, ruzomberok@fio.sk
Trenčín, Sládkovičova 8, 911 01, trencin@fio.sk
Trnava, Hlavná 25, 917 01, trnava@fio.sk
Žilina, Na priekope 37, 010 01, zilina@fio.sk

Trading on the markets in the Czech Republic

The year 2021 was extremely successful on the Prague Stock Exchange. The performance of the local
market exceeded principal European and American stock indices. The PX index added almost +39 %

General Part 14
and saw the end of the year above 1,426 points. If we include dividends, the performance of the Prague
Stock Exchange was even +44 %. This growth was the highest since 2009, the Prague Stock Exchange
returned to the levels of 2008 before the financial crisis in the PX index.
In the principal market, the most successful were the shares of Česká zbrojovka which increased by
+73 % to CZK 508. The success was due to the acquisition of the American COLT group. However, the
biggest interest was attracted by the growth of ČEZ shares (+60 %) which was accompanied by
increased volumes to the Prague Stock Exchange. The driver of the improved financial management of
the electricity company is the development in electricity prices. The shareholders additionally received
a CZK 52 dividend. The banks also had a strong year. Erste managed to go up to the levels of 2018
(CZK 1,025) and its total growth of +55% only narrowly followed the shares of ČEZ. Another bank,
Komerční banka (+46%), ranked fourth. Local banks profited from a rapid growth in the interest rates by
the Czech National Bank. Yet, Moneta (+38%) fell slightly behind the index performance. Here, investors
additionally monitored the story of the merger with the banking section of PPF, which includes Air Bank
and Home Credit. The general meeting of Moneta approved the financing for the transactions,
i.e. increase in the share capital for subscription of new shares. The STOCK shares managed to add
+42% by autumn, after that they were withdrawn from the market after the takeover. The end on the
stock exchange will be expected in 2022 by shareholders of O2 (+6,4%), its majority owner, the PPF
Group, decided on the squeeze-out of minority shareholders for CZK 270. The shares of Avast (+16%)
are also shares that will see the end of the stock exchange. In mid-2021, the American competitor
NortonLifeLock decided to take over the company, the merger was already approved by both entities
and the completion of the transaction is expected during 2022. The shares of a new entity will then be
traded on the New York Stock Exchange.
The START segment was dominated by Pilulka shares with incredible profit of +188%.

Foreign market trading

Stock markets continued the growth from the prior year and saw another very successful year. Investors
forgot about the continued pandemic when the introduced distancing measures had no longer such
overall economic impact. The labour market recovered quickly and returned to pre-pandemic levels.
However, the pandemic continued to cause problems in supplier chains which resulted in an increased
inflation. In Europe, energy prices increased significantly. Companies managed to handle the difficult
situation very well, the profits at the level of principal indices significantly increased year-on-year.
However, industry sectors such as retail or tourism continued to have difficult times. Nevertheless, there
were no large company bankruptcies as governments and central banks continued their support for the
economy. While principal central banks saw inflation as a temporary issue, interest rates in developing
economies started to gradually increase. As such, government bond yields remained on very low levels
during the year which supported maintenance of a higher stock valuation from the historical perspective.
Inflation pressures however continued and the argument about its temporary character was gradually
abandoned even by central bankers from major regions. The expectations of normalisation in the fiscal
and currency policy negatively impacted primarily fast growing sectors with higher valuation at the end
of the year.

In terms of individual stock indices, the performance turned around as compared to the prior year. Main
indices in the USA and Europe increased by more than 20%. The best performance was recorded in
the power, real estate, technology and financial sectors. On the contrary, weaker performance was
recorded by indices in Asia where Japanese Nikkei added only 5%, South Korean Kospi 3.6% and the
Hang Seng index lost 14% due to problems in China. A big issue on the market was an increased
regulatory pressure of the Chinese government on the technology sector and overall greater state
interventions in the economy than in prior years. For these reasons, shares of Chinese technology
companies saw a significant decline. Due to the dampening of the real estate bubble, main developers
got into financial difficulties and the Chinese economy slowed down in general.

Proprietary trading

In 2021, Fio banka kept or further strengthened its positions built on financial markets. In stock trading,
the bank continued its market maker role in the Prague Stock Exchange in all issues placed on the
Prime market while being part of the PX index. According to the statistics of trades by members of the
Stock Exchange, the volume of trades by Fio banka in 2021 increased to CZK 51.24 billion from the

General Part 15
prior CZK 48.11 billion in 2020, which is a year-on-year increase of 6.5%. In the overall ranking of
members of the Stock Exchange by completed trade volumes for 2021, the Bank kept its second
position.

During 2021, Fio banka increased the volume of the debt securities portfolio. There were enough
opportunities on the market, the issue activity of the Czech Ministry of Finance remained increased. In
specific figures, the total volume of bonds increased from CZK 71.15 billion at the end of 2020 to
CZK 117.86 billion at the end of 2021, which is a 66% increase. The portfolio additionally includes only
government bonds of which almost 97% are Czech issues and the rest are Slovak bonds.

In mid-2021, the Czech National Bank initiated the cycle of interest rate increases and the 2-week repo
rate increased from the original 0.25% to 3,75% by the end of the year. By this the central bank
responded to the increasing inflation which hiked a great deal above the level of the tolerance band, be
it the impact of global or local factors. In the latter half of the year it was therefore possible to generate
significantly higher returns on the money market by placements of available funds. Most of trades by
Fio banka were with the Czech National Bank in two-week repo transactions.

Information on the Company’s assets and financial situation

The Bank’s total assets amounted to CZK 214,684,966 thousand as of 31 December 2021, principally
comprising cash in hand and balances with central banks of CZK 55,053,982 thousand, government
zero-coupon bonds of CZK 0 thousand, loans and receivables to banks and cooperative credit unions
of CZK 2,288,854 thousand, loans and receivables to customers of CZK 37,453,617 thousand, debt
securities of CZK 117,877,849 thousand, shares, share certificates and other equity investments
of CZK 203,748 thousand, investments in subsidiaries of CZK 71,608 thousand and other assets
of CZK 1,283,410 thousand.

In 2021, the Company recorded a net fee and commission income of CZK 523,840 thousand, a net
interest income of CZK 2,493,945 thousand and income from financial transactions
of CZK 841,848 thousand. The Bank’s profit from ordinary activities before tax was
CZK 2,840,771 thousand.

The Bank’s situation has been stable in the long-term. The Bank has permanently a sufficient amount
of liquid financial assets to settle its liabilities; it makes allocations, on a regular basis and in full, to the
Stock Exchange’s guarantee funds, to the Deposit Insurance Fund and the Securities Dealers
Guarantee Fund. The Bank has never been insolvent throughout its existence.

After assessing the impacts of COVID-19 on its business activities, the Bank has concluded that no
negative events occurred that would have a material impact on the Company’ s ability to continue as
a going concern and generate profit every year. The year-on-year decrease in profit is caused more by
the market development (especially interest rates) than losses directly resulting from government
restrictions. The Bank will continue to monitor the possible impact of COVID-19 and accept all necessary
measures to mitigate the impacts not only on the Bank and its employees but primarily on its clients.
Successful expansion of the Bank’s credit portfolio as well as an increase in other indicators resulted in
a larger volume of risk exposures. As of 31 December 2021, the Bank’s capital ratio was 22.49%
(of which 22.22% constitutes the Tier 1 capital ratio), which is above the level of regulatory requirements,
constituting a secure level for risk coverage.
Information on the contribution to the Guarantee Fund
As a securities trader, Fio banka, a.s., contributes to the Securities Traders Guarantee Fund, which
provides a guarantee system from which compensation is paid to customers of securities traders that
are unable to meet commitments towards their clients. The basis for calculating the Bank’s contribution
to the Guarantee Fund for 2021 amounted to CZK 240,668,403. The amount of the Bank’s contribution
amounted to CZK 4,813,368.

Information on the Bank’s Environmental Objectives

General Part 16
Fio banka approaches the environmental protection in a pragmatic manner and starts primarily with
itself. The management philosophy has contained a principle of not wasting resources and behave in
environmentally friendly manner since the beginning as it sees these principles as a basis of good
behaviour and business. At the same time, it sees sustainability as an opportunity for innovations and
modernisation.

The current environmental objectives primarily relate to environmentally friendly operations. Here, the
Bank meets the objectives by an increasing degree of banking processes digitisation which involves
contracts in the electronic form and consequently reduction in paper consumption. With regard to
sustainability and environmental protection, we are going to introduce “paperless” digital contracts and
documents even in negotiations on business points which will significantly contribute to reducing
consumption in this respect.

Naturally, we observe relevant legal regulations in our environmental objectives. In relation to lending
and investment objectives, this is one of the considered criteria, primarily in terms of long-term
sustainability and profitability of such business.

E. Statutory, Supervisory and Other Bodies

Board of Directors:
Jan Sochor, Chairman of the Board of Directors
Mr Sochor graduated from the Faculty of Mathematics and Physics of Charles University and has
been active on the capital market for more than 20 years. He has been Chairman of the Board since
22 May 2002. From 30 April 2001 to 23 April 2002, he worked as a statutory executive
of the securities trading company Fio brokerská, spol. s r.o. Prior to holding this post, he had been
already employed in Fio brokerská, spol. s.r.o., predominantly focusing on creating an electronic
trading system. Jan Sochor also held the post of Chairman of the Board of Directors at Fio, burzovní
společnost, a.s.

Josef Valter, Member of the Board of Directors

Mr Valter graduated from the Faculty of Law of Charles University in Prague. He has been employed
in the Fio Financial Group since 2002, first as Head of the Legal Division and later as Director of the
Legal and Compliance Division, which has been his position to date. Josef Valter was a member
of the Board of Directors of Fio, družstevní záložna from 2002 to 2006 and Chairman of the Board
of Directors of Fio, družstevní záložna from 2006 to 2010. He has been a member of the Board
of Directors of Fio banka since 5 May 2010.
Jan Bláha, Member of the Board of Directors
Mr Bláha graduated from the Faculty of Economics of VŠB - Technical University of Ostrava and has been
employed in the Fio Financial Group since 2000. At present, he is Director of the Sales Division. He has
been a member of the Company’s Board of Directors since 25 March 2015.

Marek Polka, Member of the Board of Directors

Mr Polka graduated from the Faculty of Finance and Accounting of the University of Economics, Prague
(VSE) and has worked for the Fio Financial Group since May 2001 when he took up the position
of a client assistant in the Prague branch. Mr Polka gradually held the positions of the acting head of the
Plzeň branch, head of the Group’s largest branch in Prague as well as the head of the entire Client Service
Department. Since April 2006, he has been the head the Group’s Client Division. On 1 April 2006 he
became a member of the Board of Directors of Fio, družstevní záložna and on 3 May 2010 Chairman
of the Board of Directors of Fio, družstevní záložna. His key responsibilities as the head of the Client
Service Department predominantly involved ensuring proper operation of branches, managing customer
relations and product range administration. Since 24 September 2014, Mr Polka has been Director of the
Company’s Credit Division. He has been a member of the Board of Directors of the Company since
25 March 2015.

Filip Novotný, Member of the Board of Directors

General Part 17
Mr Novotný graduated from the Faculty of Mathematics and Physics at Charles University. He joined
the Fio financial group in October 2004, when he joined the company as a client-focused employee
at the Prague office. Since 2006, he has held the position of chief risk manager at Fio, burzovní společnost,
a.s. At present, he holds the position of chief risk manager at Fio banka and a member of the Board
of Directors responsible for risk management..

Under Section 8 (1) of Act No. 21/1992 Coll. on Banks, as amended, the Bank’s Board of Directors had five
members as of 31 December 2021.

Supervisory Board:

Romuald Kopún, Chairman of the Supervisory Board

Mr Kopún graduated from the Faculty of Mathematics and Physics of Charles University. He has been
a member of the Supervisory Board since 1994. By holding this position, he has gained the necessary
experience in the capital market sector.

Petr Marsa, Vice Chairman of the Supervisory Board

Mr Marsa graduated from the Faculty of Mathematics and Physics of Charles University. He has been active
on the financial market for more than 25 years. He has held various positions in the bodies of several entities
within the Fio Financial Group.

Ján Franek, Member of the Supervisory Board (membership expired on 30 December 2021)
Mr Franek graduated from the Faculty of Nuclear Sciences and Physical Engineering of the Czech
Technical University in Prague. He was working for the Fio Financial Group from 1995 to 30 December
2021. From 2001 to 30 December 2021, he was the head of the Software Division, responsible for the
development and operations of the Fio Financial Group’s information system and was the head
of development projects aimed at expanding and improving the quality of client services.

During 2022, Fio banka, a.s. communicated with the Czech National Bank in respect of an approval
regarding the appointment of a new (third) member of the Supervisory Board; however, the new member
of the Supervisory Board was not appointed or approved by the Czech National Bank as of the financial
statements preparation date.

Audit Committee:

Jan Kotíšek, Chairman of the Audit Committee

Mr Kotíšek graduated from the faculty of International Relations of the University of Economics, Prague
(VSE) and completed the Executive MBA in Finance at the University of New York in Prague. Mr Kotíšek
has worked on the financial market for more than 20 years, holding posts at Vojenský otevřený penzijní
fond, a.s., Foresbank, a.s., Spořitelní a úvěrové družstvo Unibon, Záložna CREDITAS, spořitelní družstvo
as well as at the Supervisory Office for Credit Unions.

Petr Marsa, Vice-chairman of the Audit Committee

Mr Marsa graduated from the Faculty of Mathematics and Physics of Charles University. He has been
active on the financial market for more than 25 years. He has held various positions in the bodies of several
entities within the Fio Financial Group.

Václav Svoboda, Member of the Audit Committee

Mr Svoboda graduated at the Faculty of Economics of the University of Economics, Prague. He has
worked as a statutory auditor for over 20 years.

Members of the Board of Directors, Supervisory Board, Audit Committee or the Company’s
management hold no treasury shares of the Company.

The Company’s employees do not have an opportunity to have equity interests in the Company.

General Part 18
F. Other Information
The statement of changes in equity for the last two reporting periods is included in the financial
statements which form part of this annual report.

The number of average recalculated headcount and changes thereof are disclosed in the notes to the
financial statements for the year ended 31 December 2021 which are part of this annual report.
Increasing the number of the Company’s staff corresponds to the Company’s strategy aimed at the
continuous increase of the quality of provided services.

The Company incurred no costs on research, development and environmental protection in 2021. The
costs of labour relations incurred in 2021 are disclosed in the notes to the financial statements for the
year ended 31 December 2021 which are part of this annual report.

Based on a decision of the Board of Directors of 5 May 2010, an organisational branch of the Company
was established in Slovakia: Fio banka, a. s., pobočka zahraničnej banky, corporate ID: 36 869 376,
Nám. SNP 21, Bratislava 811 01, Slovakia.

The Company will continue to operate as a going concern.

Significant Post Balance Sheet Events

No events occurred subsequent to the balance sheet date on 31 December 2021 that would have
a material impact on the Bank’s operation and financial performance.

Impacts of the war between Russia and Ukraine on the Bank

The ongoing military conflict in Ukraine and relating sanctions against the Russian Federation may have
an impact on the European and global economy. The Company does not have any significant direct
exposure to Ukraine, Russia and Belarus. However, the impact on the general economic situation may
require revisions of certain assumptions and estimates. This may lead to material adjustments to the
carrying value of certain assets and liabilities within the next financial year. At this stage, management
is not able to reliably estimate the impact as events are unfolding day by day. A long-term impact may
also affect trading volumes, cash flows and profitability..

Between February and April 2022, the Bank introduced measures in line with the relevant sanction
regulations; however these sanctions have an impact only on marginal share of the Bank’s clients.

Additionally, the Bank, as one of the first banks in the Czech Republic, took measures for the support
of Ukraine and its citizens in the form of remitted fees for payments abroad made by its clients to
accounts in Ukrainian banks.

Head of the organisational branch:

Marek Polka
Mr Polka graduated from the Faculty of Finance and Accounting of the University of Economics, Prague
(VSE) and has worked for the Fio Financial Group since May 2001 when he took up the position of a client
assistant in the Prague branch. Mr Polka gradually held the positions of the acting head of the Plzeň branch,
head of the Group’s largest branch in Prague as well as the head of the entire Client Service Department.
Since April 2006, he has been head of the Group’s Client Division. On 1 April 2006 he became a member
of the Board of Directors of Fio, družstevní záložna and on 3 May 2010 Chairman of the Board of Directors
of Fio, družstevní záložna. His key responsibilities as head of the Client Service Department predominantly
involved ensuring proper operation of branches, managing customer relations and product range
administration. Since 24 September 2014, Mr Polka has been Director of the Company’s Credit Division.
He has been a member of the Board of Directors of the Company since 25 March 2015.

General Part 19
G Persons Responsible for the Annual Report
Jan Sochor, Chairman of the Board of Directors of Fio banka, a.s., holds responsibility for the annual
report.

The financial statements were audited by:

Deloitte Audit s.r.o., corporate ID: 49620592, ltalska 2581/67, Vinohrady, 120 00 Prague 2.

In Pra;/ ue on 28 April 2022

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Jan Sochor
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Directors

General Part
II
Auditor’s Report

Auditor’s Report
 Deloitte Audit s.r.o.

Deloitte. Churchill I
ltalska 2581167
120 00 Praha 2 - Vinohrady
Czech Republic

Tel: +420 246 042 500

Fax: +420 246 042 555
DeloitteCZ@deloitteCE.com
www.deloitte.cz

Registered by the Municipal Court

in Prague, Section C. File 24349
ID. No.: 49620592
Tax ID. No.: CZ49620592

INDEPENDENT AUDITOR'S REPORT

To the Shareholders of
Fio banka, a.s.
Having its registered office at: V Celnici 1028/10, 117 21 Praha 1

Report on the Audit of the Financial Statements

Opinion

We have audited the accompanying financial statements of Fio banka, a.s. (hereinafter also the "Company") prepared
on the basis of accounting regulations applicable in the Czech Republic, which comprise the balance sheet as
of 31 December 2021, and the profit and loss account, statement of changes in equity and cash flow statement for
the year then ended, and notes to the financial statements, including a summary of significant accounting policies and
other explanatory information.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of Fio banka, a.s.
as of 31 December 2021, and of its financial performance and cash flows for the year then ended in accordance with
accounting regulations applicable in the Czech Republic.

Basis for Opinion

We conducted our audit in accordance with the Act on Auditors, Regulation (EU) No. 537/2014 of the European
Parliament and the Council and Auditing Standards of the Chamber of Auditors of the Czech Republic, which are
International Standards on Auditing (ISAs), as amended by the related application guidelines. Our responsibilities under
this law and regulation are further described in the Auditor's Responsibilities for the Audit of the Financial Statements
section of our report. We are independent of the Company in accordance with the Act on Auditors and the Code of Ethics
adopted by the Chamber of Auditors of the Czech Republic and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit
of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.

Key audit matter Related audit procedures

Provisions for amounts due from clients

(Notes 3.2.1 and 4.4. to the financial statements)Based on our risk assessment and knowledge of the industry,
we reviewed provisions, assessed the methodology applied
As of 31 December 2021, gross amounts due from and the assumptions used. In cooperation with our
clients (hereinafter "loans") were CZK 38,799,507 specialists, we recalculated provisions.
thousand against which provisions for loans

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited ("DTIL"). its global network of member firms, and their related entitles. DTIL (also
referred to as "Deloitte Global") and each of its member firms are legally separate and independent entities. DTTL does not provide services to clients.
Please see www.deloitte.com/abou t to lea rn more.
Key audit matter Related audit procedures

(hereinafter "provisions") of CTK 1,345,890 thousand We tested the design and operating effectiveness of
were recorded. selected key internal controls introduced by the Bank's
management to assess impairment and recognise
The provisions are determined either individually for provisions. With the help of IT specialists, we tested IT
significant credit impaired exposures (stage 3 controls relating to access rights and change management
defaulted) or using statistical models for performing of relevant IT applications.
loans (stage 1 and 2).
Testing of internal controls
The assessment of provisions against amounts due
from clients requires from the Company's management We tested the design and operating effectiveness
a significant level of judgement, especially with respect of the key internal controls to determine which loans are
to the identification of impaired amounts and impaired and provisions for those assets. Our procedures
quantification of their impairment. Given the COVID-19 included testing of the following:
pandemic, the level of uncertainty and the level
of management's judgement subjectivity have • System-based and manual controls over the timely
increased significantly with respect to the financial identification and recognition of provisions for loans;
reporting for 2021. • Controls over the provision calculation and recording;
• Controls over collateral valuation estimate; and
Because of the significance of professional judgements • The governance process of management validation
and the size of loans, the audit of provisions is a key of provision calculations.
audit matter.
Assumptions used in the expected credit loss models
The most significant judgements are:
We assessed, in cooperation with our specialists,
• Assumptions used in the expected credit loss the methodology of the models. We assessed whether
models to assess the credit risk related to the modelling assumptions considered all relevant risks and
the exposure and the expected future cash flows were reasonable in light of historical experience and forward
of the customer. outlook, economic climate, and the circumstances
• Timely identification of exposures with a significant of the customers. We performed analytical procedures on
increase in credit risk and credit impaired exposures a portfolio basis.
in the context of the COVID-19 pandemic.
• Valuation of collateral and assumptions of future With respect to the extreme volatility of economic scenarios
cash flows on individually assessed credit-impaired caused by the ongoing COVID-19 pandemic and government
exposures. measures, we assessed whether the parameters used in the
statistical models of expected credit loss provide a true view
of the expected future default level and recoverability
of loans.

Identification of exposures with a significant increase in

credit risk and credit impaired loans

In cooperation with our specialists, we evaluated

assumptions used for staging models and we recalculated
the staging on a portfolio basis.

We tested a sample of loans (including loans that had not

been classified by management as stage 3) to form our own
assessment as to whether impairment events had occurred
and to assess whether impairment had been identified in
a timely manner.

Provisions for individually assessed credit impaired loans

The Bank determines provisions individually for significant

credit impaired exposures (stage 3 defaulted).

We selected a sample of loans and, where we deemed them

to be impaired, tested the amount of provisions recorded by
the Bank in terms of loan categorisation, expected recovery
and collateral held. In some cases, we used our own industry
Key audit matter Related audit procedures

experts, particularly in respect of commercial real estate, to

assess the appropriateness of valuations and estimates used
by the Company. Where we determined that a more
appropriate assumption or input in provision measurement
could be made, we recalculated the provision on that basis
and compared the results in order to evaluate management
estimate.

Our testing reflected the financial position and performance

of the debtor in the current economic environment affected
by COVID-19.

Interest and fee income recognition

(Notes 3.10, 4.17 and 4.18 to the financial statements) We tested the design and operating effectiveness of the key
internal controls and focused on:
For the year ended 31 December 2021 the interest
income and similar income amounted to CZK 2,813,448 • Assessment of interest/fees recognition;
thousand. Total fee and commission income for the • Interest/fee inputs on client loans and deposits,
same period amounted to CZK 799,621 thousand. With including authorisation of the changes in the interest and
the main source being provided loans, client deposits fee price list and authorisation of non-standard
and client transactions, these are the main contributors interest/fees;
to the income of the Company affecting the • IT controls relating to access rights and change
profitability. management of relevant IT applications with
the assistance of our IT specialists; and
Interest income and fee income are recognised in • We evaluated the accounting treatment performed by
the profit and loss account in the period to which they the Company in respect of fees charged to clients to
relate on an accrual basis. Loan interest is accrued on determine whether the methodology complies with the
a daily basis. Fees for services provided are recognised requirements of the relevant accounting standard.
when the service is provided and are presented as fee
and commission income. Fees for the execution of an We focused our testing on challenging the correct
act are recognised when the act has been completed classification of interest income and fee income.
and are presented as fee and commission income.
On a sample basis, we checked the correctness of the
Revenue recognition specifics, a high volume calculation of interest income for the main types of provided
of individually small transactions which depends loans to assess the completeness and accuracy of data used
on data quality of interest and fee inputs and on for the calculation. We also reviewed the correctness
IT solutions for their recording resulted in this matter of accounting for the main types of fees.
being identified as a key audit matter.
We performed analytical procedures and benchmarking.

Other Information in the Annual Report

In compliance with Section 2(b) of the Act on Auditors, the other information comprises the information included in
the Annual Report other than the financial statements and auditor's report thereon. The Board of Directors is
responsible for the other information.

Our opinion on the financial statements does not cover the other information. In connection with our audit
of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the
other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated. In addition, we assess whether the other information has been prepared,
in all material respects, in accordance with applicable law or regulation, in particular, whether the other information
complies with law or regulation in terms of formal requirements and procedure for preparing the other information in
the context of materiality, i.e. whether any non-compliance with these requirements could influence judgments made
on the basis of the other information.
Based on the procedures performed, to the extent we are able to assess it, we report that:

• The other information describing the facts that are also presented in the financial statements is, in all material
respects, consistent with the financial statements; and
• The other information is prepared in compliance with applicable law or regulation.

In addition, our responsibility is to report, based on the knowledge and understanding of the Company obtained in
the audit, on whether the other information contains any material misstatement of fact. Based on the procedures we
have performed on the other information obtained, we have not identified any material misstatement of fact.

Responsibilities of the Company's Board of Directors and Su pervisory Board for the Financial Statements

The Board of Directors is responsible for the preparation and fair presentation of the financial statements in accordance
with accounting regulations applicable in the Czech Republic and for such internal control as the Board of Directors
determines is necessary to enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.

In preparing the financial statements, the Board of Directors is responsible for assessing the Company's ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has
no realistic alternative but to do so.

The Supervisory Board is responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with the above law or regulation, we exercise professional judgment and maintain
professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud
is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the Board of Directors.
• Conclude on the appropriateness of the Board of Directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to
cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.

We communicate with the Board of Directors, the Supervisory Board and the Audit Committee regarding, among other
matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the Board of Directors, the Supervisory Board and the Audit Committee, we
determine those matters that were of most significance in the audit of the financial statements of the current period
and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would reasonably be expected
to outweigh the public interest benefits of such communication.

Report on Report on Relations among Related Entities (the "Report on Relations")

We have reviewed the factual accuracy of the information included in the accompanying related party transactions
report of Fio banka, a.s. for the year ended 31 December 2021 which is included in this annual report in Section V. This
related party transactions report is the responsibility of the Company's Statutory Body. Our responsibility is to express
our view on the related party transactions report based on our review.

We conducted our review in accordance with Auditing Standard 56 issued by the Chamber of Auditors
of the Czech Republic. This standard requires that we plan and perform the review to obtain moderate assurance as to
whether the related party transactions report is free of material factual misstatements. A review is limited primarily to
inquiries of Company personnel and analytical procedures and examination, on a test basis, of the factual accuracy
of information, and thus provides less assurance than an audit. We have not performed an audit of the related party
transactions report and, accordingly, we do not express an audit opinion.

Nothing has come to our attention based on our review that indicates that the information contained in the related
party transactions report of Fio banka, a.s. for the year ended 31 December 2021 contains material factual
misstatements.

The Company has decided not to disclose amounts under related party contracts citing business secrecy restrictions.

Report on Other Legal and Regulatory Requirements

In compliance with Article 10 (2) of Regulation (EU) No. 537/2014 of the European Parliament and the Council, we
provide the following information in our independent auditor's report, which is required in addition to the requirements
of International Standards on Auditing:

Appointment of the Auditor and the Period of Engagement

We were appointed as the auditors of the Company by the General Meeting of Shareholders on the basis of a tender on
23 October 2018 and our total uninterrupted engagement has lasted for 12 years.

Consistence with the Additional Report to the Audit Committee

We confirm that our audit opinion on the financial statements expressed herein is consistent with the additional report
to the Audit Committee of the Company, which we issued on 28 April 2022 in accordance with Article 11 of Regulation
(EU) No. 537/2014 of the European Parliament and the Council.

Provision of Non-audit Services

We declare that no prohibited non-audit services referred to in Article 5 of Regulation (EU) No. 537 /2014
of the European Parliament and the Council were provided. In addition, there are no other non-audit services which
were provided by us to the Company and its controlled undertakings and which have not been disclosed in the annual
report.

In Prague on 28 April 2022

Audit firm: Statutory auditor:

Deloitte Audit s.r.o. Diana Rad! Rogerova

registration no. 079 registration no. 2045

~--6w4p,q/
III
The Company’s Financial
Statements for the Year Ended
31 December 2021

The Company’s Financial Statements for the Year Ended 31 December 2021
 FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2021

Name of the Company: Fio banka, a.s.

Registered Office: V Celnici 1028/10, 117 21 Praha l

Legal Status: Joint Stock Company

Corporate ID: 618 58 374

Com ponents of the Financial Statements:

Balance Sheet

Off Balance Sheet Accounts

Profit and Loss Account

Cash Flow Statement

Statement of Changes in Equity

Notes to the Financial Statements

These financial statements were prepared on 28 April 2022.

Statutory body of the reporting entity:

Jan Sochor
Chairman of the Board of Directors

Marek Polka
Member of the Board of Directors
(
Business name of the entity Fio banka, a.s.
Registered office of the entity V celnici 1028/10, 11721 Praha 1
Corporate ID 61858374

Balance sheet as of 31 December 2020

in CZK thousand
Current period Prior period
No. Text Line Gross Adjustment Net Net
1. Cash in hand and balances with central banks 1 81 086 816 0 81 086 816 118 147 694
State zero-coupon bonds and other securities eligible for
2. refinancing with the CNB 2 2 571 771 0 2 571 771 0
2.a) State securities 3 2 571 771 0 2 571 771 0
2.b) Other 4 0 0 0 0
3. Loans and receivables to banks and cooperative credit unions 5 1 915 066 0 1 915 066 2 097 265
3.a) Repayable on demand 6 1 470 961 217 1 470 744 1 700 756
3.b) Other receivables 7 444 322 0 444 322 396 509
4. Loans and receivables to customers 8 27 641 635 1 496 642 26 144 993 20 148 308
4.a) Repayable on demand 9 610 143 215 226 394 917 270 704
4.b) Other receivables 10 27 031 492 1 281 416 25 750 076 19 877 604
5. Debt securities 11 68 581 708 0 68 581 708 4 358 351
5.a) Issued by government institutions 12 68 581 708 0 68 581 708 4 358 351
5.b) Issued by other entities 13 0 0 0 0
6. Shares, share certificates and other equity investments 14 181 045 0 181 045 172 494
7. Investments in associates 15 0 0 0 0
of which: in banks 16 0 0 0 0
8. Investments in subsidiaries 17 163 789 0 163 789 159 992
of which: in banks 18 0 0 0 0
9. Intangible fixed assets 19 34 996 32 277 2 719 4 202
9.a) Start-up costs 20 0 0 0 0
9.b) Goodwill 21 -1 143 -1 143 0 0
10. Tangible fixed assets 22 645 076 145 499 499 577 243 878
Land and buildings for operating activities 23 527 534 95 996 431 538 213 727
11. Other assets 24 1 345 459 1 775 1 343 684 1 376 186
12. Receivables from subscribed capital 25 0 0 0 0
13. Prepayments and accrued income 26 46 055 0 46 055 62 017
TOTAL ASSETS 27 184 213 416 1 676 193 182 537 223 146 770 387

1. Due to banks and cooperative credit unions 28 224 458 233 134
1.a) Repayable on demand 29 224 458 233 134
1.b) Other payables 30 0 0
2. Due to customers 31 174 860 192 140 442 137
2a) Repayable on demand 32 171 285 699 136 106 204
2b) Other payables 33 3 574 493 4 335 933
3. Payables from debt securities 34 0 0
3a) Issued debt securities 35 0 0
3b) Other payables from debt securities 36 0 0
4. Other liabilities 37 1 470 646 1 125 499
5. Deferred income and accrued expenses 38 0 0
6. Reserves 39 290 150 425 804
6.a) Reserves for pensions and similar liabilities 40 0 0
6.b) Reserves for taxes 41 286 764 423 721
6.c) Other reserves 42 3 386 2 083
7. Subordinated liabilities 43 90 000 90 000
8. Share capital 44 760 000 760 000
8.a) Share capital paid up 45 760 000 760 000
8.b) Treasury shares 46 0 0
8.c) Changes in share capital 47 0 0
9. Share premium 48 0 0
10. Reserve funds and other funds from profit 49 0 0
11.a) Mandatory reserve funds and risk funds 50 0 0
11.c) Other reserve funds 51 0 0
11.d) Other funds from profit 52 0 0
11. Revaluation reserve 53 0 0
12. Capital funds 54 0 0
13. Gains or losses from revaluation of 55 0 28 537
13.a) Assets and liabilities 56 0 28 537
13.b) Hedging derivative instruments 57 0 0
13.c) Retranslation of equity holdings 58 0 0
14. Retained earnings or accumulated losses brought forward 59 3 665 275 1 862 156
15. Profit/(loss) for the period 60 1 176 502 1 803 120
TOTAL LIABILITIES 61 182 537 223 146 770 387
Profit and loss account for the year ended 31 December 2020
in CZK thousand

No. Text Line No. Current period Prior period

1. Interest income and similar income PL1 2 353 286 2 919 667
Interest income from debt securities PL2 702 471 109 325
2. Interest expense and similar expense PL3 346 497 521 705
Interest expense from debt securities PL4 129 582 858
3. Income from shares and participation interests PL5 22 609 2 967
3.a. Income from participation interests in associates PL6 0 0
3.b. Income from participation interests in subsidiaries PL7 0 0
3.c. Income from other shares and participation interests PL8 22 609 2 967
4. Commission and fee income PL9 704 934 602 839
5. Commission and fee expense PL10 272 078 227 265
6. Net profit or loss on financial operations PL11 689 039 634 436
7. Other operating income PL12 16 936 11 071
8. Other operating expenses PL13 104 433 93 754
9. Administrative expenses PL14 861 914 745 680
9.a. Staff costs PL15 131 242 108 113
9.a.1. of which: social security and health insurance PL16 26 515 21 429
9.b. Other administrative expenses PL17 730 672 637 567
10. Release of reserves and provisions for tangible and intangible fixed assets PL18 0 0
Depreciation/amortisation, charge for and use of reserves and provisions for
11. tangible and intangible fixed assets PL19 105 543 51 564
Release of provisions and reserves for receivables and guarantees, recoveries of
12. receivables written off PL20 0 0
Write-offs, charge for and use of provisions and reserves for receivables and
13. guarantees PL21 636 245 306 207
14. Release of provisions for participation interests PL22 0 0
Loss on the transfer of participation interests, charge for and use of provisions for
15. participation interests PL23 0 0
16. Release of other reserves PL24 0 0
17. Charge for and use of other reserves PL25 0 0
18. Share of profits/(losses) of subsidiaries and associates PL26 3 797 640
19. Profit/(loss) for the period from ordinary activities before taxes PL27 1 463 891 2 225 445
20. Extraordinary income PL28 0 0
21. Extraordinary expenses PL29 0 0
22. Profit/(loss) for the period from extraordinary activities before taxes PL30 0 0
23. Income tax PL31 287 389 422 325
24. Net profit/(loss) for the period PL32 1 176 502 1 803 120
Statement of changes in equity
in CZK thousand
Valuation gains or Retained earnings/ (loss) brought Profit or loss in the approval
Share capital Reserve funds Profit (loss) for the period Total
losses forward process

Balance at 1 January 2019 760 000 0 19 904 833 842 1 028 313 2 642 059

Changes in accounting policies

Corrections of major errors

FX differences and valuation differences not

included in profit lor loss 8 633
Net profit/loss for the period 1 803 120
Dividends
Transfers to funds 1 028 313 -1 028 313
Use of funds
Share issues
Increase/decrease in share capital
Purchase of treasury shares
Other changes

Balance at 31 December 2019 760 000 0 28 537 1 862 155 0 1 803 120 4 453 812

Balance at 1 January 2020 760 000 0 28 537 1 862 155 1 803 120 4 453 812

Changes in accounting policies

Corrections of major errors

FX differences and valuation differences not

included in profit lor loss
Net profit/loss for the period 1 176 502
Dividends
Transfers to funds 1 803 120 -1 803 120
Use of funds
Share issues
Increase/decrease in share capital
Purchase of treasury shares
Other changes -28537

Balance at 31 December 2020 760 000 0 0 3 665 275 0 1 176 502 5 601 777
Off balance sheet accounts as of 31 December 2020
in CZK thousand

No. Text Current period Prior period

1. Issued commitments and guarantees 44 954 321 22 962 500
2. Provided collateral
3. Receivables from spot transactions
4. Receivables from term transactions 20 763 629 14 526 721
5. Receivables from option transactions
6. Receivables written off
7. Assets provided into custody, administration and safe-keeping
8. Assets provided for management
9. Accepted commitments and guarantees
10. Received pledges and collateral 96 487 498 113 283 300
11. Liabilities from spot transactions
12. Liabilities from term transactions 20 741 016 14 521 460
13. Liabilities from option transactions
14. Assets received into custody, administration and safe-keeping 54 871 056 40 153 929
15. Assets received for management 0 92 227
 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021

Name of the Company: Fio banka, a.s.

Registered Office: V Celnici 1028/10, 117 21 Prague 1

Legal status: Joint Stock Company

Corporate ID: 618 58 374

 Notes to the Financial Statements for the Year Ended 31 December 2021

TABLE OF CONTENTS

1. GENERAL INFORMATION ..................................................................................................................................4

1.1. Incorporation and Description of the Business .............................................................................................. 4
1.2. Year-on-Year Changes and Amendments to the Register of Companies ....................................................... 6
1.3. Organisational Structure (as of 31 December 2021) ...................................................................................... 7
1.3.1. Fio banka, a.s. ................................................................................................................................... 7
1.3.2. Fio banka, a.s., pobočka zahraničnej banky ..................................................................................... 8
1.4. Group Identification ....................................................................................................................................... 9
1.5. Board of Directors and Supervisory Board ..................................................................................................... 9
2. PRINCIPLES FOR THE PREPARATION OF THE FINANCIAL STATEMENTS ............................................................ 10
3. SIGNIFICANT ACCOUNTING POLICIES .............................................................................................................. 11
3.1. Recognition Date .......................................................................................................................................... 11
3.2. Financial Assets ............................................................................................................................................ 11
3.2.1. Loans and Receivables to Banks and Customers, Debt Securities .................................................. 11
3.2.2. Shares, Share Certificates and Other Equity Investments............................................................... 13
3.2.3. Financial Derivatives ....................................................................................................................... 14
3.3. Financial Liabilities ....................................................................................................................................... 14
3.4. Issued Debt Securities .................................................................................................................................. 14
3.5. Transactions with Securities on behalf of Clients ........................................................................................ 14
3.6. Investments in Subsidiaries and Associates ................................................................................................. 15
3.7. Charge for Reserves ..................................................................................................................................... 15
3.8. Tangible and Intangible Assets..................................................................................................................... 15
3.9. Foreign Currency Translation ....................................................................................................................... 15
3.10. Taxation........................................................................................................................................................ 16
3.11. Interest Income and Expense ....................................................................................................................... 16
3.12. Fees and Commissions ................................................................................................................................. 16
3.13. Use of Estimates ........................................................................................................................................... 16
3.14. Uncertainty of Estimates and Parameters Used (PD, ECL and Applied Macroeconomic Scenarios) ........... 17
3.15. Lease Measurement under IFRS 16.............................................................................................................. 17
4. ADDITIONAL INFORMATION ON THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT............................... 19
4.1. Cash in Hand and Balances with Central Banks ........................................................................................... 19
4.2. State Zero-coupon Bonds and Other Securities Eligible for Refinancing with the Central Bank ................. 19
4.3. Loans and Receivables to Banks and Cooperative Credit Unions ................................................................ 19
4.4. Loans and Receivables to Customers ........................................................................................................... 19
4.5. Debt Securities ............................................................................................................................................. 22
4.6. Shares, Share Certificates and Other Equity Investments ........................................................................... 22
4.7. Investments in Subsidiaries.......................................................................................................................... 22
4.8. Fixed Assets .................................................................................................................................................. 23
4.8.1. Intangible Fixed Assets (Intangible FA) ........................................................................................... 23
4.8.2. Tangible Fixed Assets (Tangible FA)................................................................................................ 24
4.9. Other Assets ................................................................................................................................................. 25
4.10. Prepayments and Accrued Income .............................................................................................................. 25
4.11. Due to Banks and Cooperative Credit Unions .............................................................................................. 25
4.12. Due to Customers ........................................................................................................................................ 26
4.13. Other Liabilities ............................................................................................................................................ 26
4.14. Reserves ....................................................................................................................................................... 26
4.15. Subordinated Liabilities................................................................................................................................ 26
4.16. Liabilities from Debt Securities .................................................................................................................... 27
4.17. Equity ........................................................................................................................................................... 27
4.18. Interest Expense and Income ....................................................................................................................... 27
4.19. Fees and Commissions ................................................................................................................................. 28
4.20. Net Profit or Loss on Financial Operations................................................................................................... 28
4.21. Other Operating Expenses ........................................................................................................................... 28

Fio banka, a.s. 2

 Notes to the Financial Statements for the Year Ended 31 December 2021

4.22. Administrative Expenses .............................................................................................................................. 28

4.23. Taxation........................................................................................................................................................ 29
4.24. Average Number of Employees and Supervisory Board Members .............................................................. 29
5. RELATED PARTY TRANSACTIONS ..................................................................................................................... 30
6. RISK MANAGEMENT ....................................................................................................................................... 31
6.1. Bank Risks..................................................................................................................................................... 31
6.2. Market Risks ................................................................................................................................................. 31
6.2.1. Currency Risk .................................................................................................................................. 31
6.2.2. Interest Rate Risk ............................................................................................................................ 31
6.2.3. Proprietary Trading ........................................................................................................................ 32
6.3. Liquidity Risk ................................................................................................................................................ 32
6.4. Credit Risk .................................................................................................................................................... 32
6.4.1. Concentration Risk .......................................................................................................................... 33
6.5. Operational Risks ......................................................................................................................................... 33
7. RESIDUAL MATURITY OF ASSETS AND LIABILITIES .......................................................................................... 35
8. ASSETS AND LIABILITIES BY CURRENCY ........................................................................................................... 36
9. INTEREST RATE ANALYSIS ............................................................................................................................... 37
10. POST BALANCE SHEET EVENTS ........................................................................................................................ 38

Fio banka, a.s. 3

 Notes to the Financial Statements for the Year Ended 31 December 2021

1. GENERAL INFORMATION

1.1. Incorporation and Description of the Business

Fio banka, a.s. (hereinafter the “Company” or the “Bank”) was formed by a single Memorandum
of Association on 20 June 1994 (under the former name Fio, burzovní společnost, a.s.) and was incorporated
following its registration in the Register of Companies in Prague on 31 August 1994.

The Company’s business activity is in line with the provisions of Banking Act No. 21/1992 Coll., as amended, and
the licence granted by the Czech National Bank. The subject of the Company’s business activity involves:

- Undertaking the activities listed in Section 1 (1) of the Banking Act as follows:

a) Acceptance of deposits from the general public;

b) Extension of credit; and

- Undertaking the activities listed in Section 1 (3) of the Banking Act as follows:

a) Investing in securities on the Company’s own account;

b) Finance lease;
c) Payments and clearing;
d) Issuance and administration of payment facilities, e.g. credit cards and traveller’s cheques;
e) Issuance of guarantees;
f) Opening of letters of credit;
g) Collection services;
h) Provision of investment services within the scope of principal investment services.

Within the scope of principal investment services:

− Under Section 4 (2) (a) of the Capital Market Undertaking Act No. 256/2004 Coll., as amended (hereinafter
referred to as the “Capital Market Undertaking Act”), receipt and provision of instructions relating to investment
instruments, in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through (k) of the
Capital Market Undertaking Act;

− Under Section 4 (2) (b) of the Capital Market Undertaking Act, performance of instructions relating to investment
instruments to a customer’s account, in respect of investment instruments as defined in Section 3 (1) (a), (b) and
(d) through (k) of the Capital Market Undertaking Act;

− Under Section 4 (2) (c) of the Capital Market Undertaking Act, proprietary trading with investment instruments,
in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through (k) of the Capital Market
Undertaking Act;

− Under Section 4 (2) (d) of the Capital Market Undertaking Act, discretionary management of individual portfolios
under a contractual arrangement with the client if this portfolio includes defined investment instruments, in
respect of investment instruments as defined in Section 3 (1) (a), (b) of the Capital Market Undertaking Act;

− Under Section 4 (2) (e) of the Capital Market Undertaking Act, investment advisory concerning investment tools,
in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through (k) of the Capital Market
Undertaking Act;

− Under Section 4 (2) (g) of the Capital Market Undertaking Act, underwriting of investment instruments or their
placement with the obligation to issue, in respect of investment instruments as defined in Section 3 (1) (a), (b)
of the Capital Market Undertaking Act;

− Under Section 4 (2) (h) of the Capital Market Undertaking Act, underwriting of investment instruments issues or
their placement without the obligation to issue, in respect of investment instruments as defined in Section 3 (1)
(a), (b) of the Capital Market Undertaking Act;

Fio banka, a.s. 4

 Notes to the Financial Statements for the Year Ended 31 December 2021

And within the scope of additional investment services

− Under Section 4 (3) (a) of the Capital Market Undertaking Act, custody and administration of investment tools
including related services, in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through
(k) of the Capital Market Undertaking Act;

− Under Section 4 (3) (b) of the Capital Market Undertaking Act, provision of loans or borrowings to clients so as
to facilitate trading with the investment tool in which the loan or borrowing provider participates, in respect of
investment instruments as defined in Section 3 (1) (a), (b) of the Capital Market Undertaking Act;

− Under Section 4 (3) (c) of the Capital Market Undertaking Act, provision of advisory services related to the capital
structure, industrial strategies and related issues, as well as provision of advisory services and services related
to the transformation or transfers of companies;

− Under Section 4 (3) (d) of the Capital Market Undertaking Act, provision of investment recommendation
and analyses of investment opportunities or similar general recommendation related to investment tool trading,
in respect of investment instruments as defined in Section 3 (1) (a), (b) and (d) through (k) of the Capital Market
Undertaking Act;

− Under Section 4 (3) (e) of the Capital Market Undertaking Act, execution of foreign exchange operations related
to the provision of investment services;

i) Financial brokerage;
k) Foreign exchange services;
l) Provision of banking information;
m) Proprietary trading or trading on a client’s account with foreign currencies and gold;
n) Rental of safe-deposit boxes; and
o) Activities that directly relate to the activities in the banking licence.

Company’s share capital: CZK 760,000 thousand

Balance sheet date: 31 December 2021
Financial statements prepared on: 28 April 2022
Accounting period: Calendar year
Currency used in the financial statements: Czech crown (CZK)

The following table shows individuals and legal entities with an equity interest greater than 20 percent and the
amount of their equity interest:

Shareholder Ownership percentage

Fio holding, a.s., V Celnici 1028/10, Postal Code 117 21, Prague 1 100%
Total 100%

On 31 October 2014, the Company, by means of its organisational branch Fio banka, a.s., pobočka
zahraničnej banky (established in Slovakia) acquired part of the business of Fio o.c.p., a.s., in line with the
decisions of the Czech National Bank dated 8 October 2014, the National Bank of Slovakia dated 9 October
2014 as well as the decision of the sole shareholder of Fio o.c.p., a.s. dated 31 October 2014, whereby
the sole shareholder (the Company) acting in the capacity of the General Meeting approved concluding the
respective Contract for the sale of part of business. On 24 August 2017, the Contract on transferring the shares
of Fio o.c.p. was concluded based on which a 100% equity investment in Fio o.c.p. was transferred.

Fio banka, a.s. 5

 Notes to the Financial Statements for the Year Ended 31 December 2021

1.2. Year-on-Year Changes and Amendments to the Register of Companies

In the year ended 31 December 2021, the following changes were made in the Register of Companies held by
the Municipal Court in Prague in respect of Fio banka, a.s. (in chronological order):

− On 30 December 2021, the following changes were made:

o Membership of Ján Franek in the Supervisory Board of Fio banka, a.s. expired

In the year ended 31 December 2021, the following changes were made in the Register of Companies of Slovakia
held by the District Court in Bratislava I in respect of Fio banka, a.s pobočka zahraničnej banky (in chronological
order):
− On 5 August 2021, the following changes were made:

o Change in the address of the registered office of Fio banka, a.s. pobočka zahraničnej banky
to Dunajská 1, 811 08 Bratislava – mestská časť Staré mesto

Fio banka, a.s. 6

 Notes to the Financial Statements for the Year Ended 31 December 2021

1.3. Organisational Structure (as of 31 December 2021)

1.3.1. Fio banka, a.s.

Fio banka, a.s. 7

 Notes to the Financial Statements for the Year Ended 31 December 2021

1.3.2. Fio banka, a.s., pobočka zahraničnej banky

Manager of the Other divisions of Fio banka reporting to the

organisational Board of Directors or responsible Board
branch members

AML officer Cooperation

Reporting and accounting

departments
Additional information:
- Functions in blue boxes are managed centrally from the Czech Republic.
If such department or function reports to the manager of the
Branch network Slovakia organisational branch, this relation only applies to the activities of the
foreign branch in Slovakia. More detailed specification of “other divisions”
is disclosed in the current organisational structure of Fio banka, a.s.
Mortgage specialists Slovakia
- Functions in green boxes are performed directly in the Slovak Republic.

Trading Slovakia

Fio banka, a.s. 8

 Notes to the Financial Statements for the Year Ended 31 December 2021

1.4. Group Identification

The Company is part of the Fio financial group.

1.5. Board of Directors and Supervisory Board

Function Name
Board of Directors Chairman Jan Sochor
Member Josef Valter
Member Jan Bláha
Member Marek Polka
Member Filip Novotný
Supervisory Board Chairman Romuald Kopún
Vice-Chairman Petr Marsa
Member Ján Franek (membership expired as of
30 December 2021)*
*During 2022, Fio banka, a.s. communicated with the Czech National Bank in respect of an approval of a new (third) member of the Supervisory
Board, however, the new member of the Supervisory Board was not appointed or approved by the Czech National Bank as of the financial
statements preparation date.

Acting on behalf of the Company by the Board of Directors is performed jointly by the Chairman and
Vice-Chairman or by the Vice-Chairman and another Vice-Chairman or by the Chairman with a Board member or by
the Vice-Chairman with a Board member.

Fio banka, a.s. 9

 Notes to the Financial Statements for the Year Ended 31 December 2021

2. PRINCIPLES FOR THE PREPARATION OF THE FINANCIAL STATEMENTS

The Company’s accounting books and records are maintained, and the financial statements were prepared
in accordance with Accounting Act 563/1991 Coll., as amended; Regulation 501/2002 Coll., which provides
implementation guidance on certain provisions of the Accounting Act for reporting entities that are financial
institutions maintaining double-entry accounting records, as amended; and Czech Accounting Standards for financial
institutions, as amended.

The financial statements have been prepared in compliance with the accruals principle whereby transactions and
other facts are recognised when they arise and accounted for in the period to which they relate. The financial
statements have been prepared on a historical cost valuation basis, with the exception of selected financial
instruments, which are measured at fair value. Assets which are not remeasured to fair value are reported in net
recoverable amount. The accounting records adhere to the prudence concept and the going concern assumption.

The presentation of financial statements requires management of the Company to make estimates and assumptions
that affect the amounts of assets and liabilities and contingent assets and liabilities reported at the date of the
financial statements and the amounts of revenues and expenses reported in the relevant reporting period. These
estimates are based on the information available at the balance sheet date and may differ from actual results.

Impact of COVID-19:
The impacts of the COVID-19 pandemic on relevant estimates affecting the value of assets and liabilities are
described in more detail in the following notes, wherever the Bank identified a significant impact of the pandemic.

These financial statements are presented in thousands of Czech crowns (CZK ‘000).

The financial statements have been prepared as of 31 December 2021.

These financial statements are unconsolidated.

These financial statements have been prepared under the assumption of going concern. Having assessed the current
and future impacts of the COVID-19 pandemic, the Bank sees no reason that would prevent it from continuing as
a going concern in the near future or from generating profit every year. The Bank will continue to monitor the
possible impact of COVID-19 and will take all the necessary measures to limit the impacts on the Bank, its employees
and clients.

The military conflict in Ukraine and the imposition of economic sanctions against Russia and Belarus resulted
in events that cannot be fully reflected in the financial statements for accrual reasons but may have a negative
impact on the Bank’s activities. Given the increasing uncertainty on the markets, there is an increased volatility in
proprietary positions in the trading portfolio which, however, does not involve a significant increase in the market
risk due to its relatively small volume compared to the balance sheet total.

Fio banka, a.s. 10

 Notes to the Financial Statements for the Year Ended 31 December 2021

3. SIGNIFICANT ACCOUNTING POLICIES

Significant accounting policies adopted in the preparation of the financial statements are set out below.

3.1. Recognition Date

The date of the recognition of individual transactions is principally the date of payment or receipt of cash, the day
of purchase or sale of foreign currencies/securities, the date on which a payment is made or an amount is collected
from the client’s account, the day of issuing an order to the correspondent to make a payment, the day of settlement
of the Company’s orders with the CNB Clearing Centre, the day on which funds are credited according to a report
from the Company’s correspondent (‘a report’ is taken to mean a report in SWIFT, a bank notice, medium take-over,
account statement, or other documents as appropriate), the trade date and the settlement date relating
to transactions with securities, foreign currencies, options or other derivatives, the date of issuance or acceptance
of a guarantee or loan commitment, and the date of accepting assets into custody.

3.2. Financial Assets

In line with Czech accounting regulations, the Company measures financial instruments based on International
Accounting Standards.

Upon initial recognition, financial assets are stated at fair value increased or decreased by transaction costs, with
the exception of financial assets at fair value through profit or loss.

The Company derecognises a financial asset from its balance sheet when it loses control of the contractual rights
that comprise the financial asset (or a portion of the financial asset). The Company loses such control if it realises
the rights to benefits specified in the contract, the rights expire, or the Company surrenders those rights.

3.2.1. Loans and Receivables to Banks and Customers, Debt Securities

Loans and receivables to banks, to customers and debt securities (debt financial assets) are classified and after
initial recognition subsequently measured at:

• Amortised cost;
• Fair value through valuation gains and losses;
• Fair value through profit or loss.

Classification is determined based on the characteristics on contractual cash flows of the debt financial asset and
the business model in which the financial asset is included:

The Bank distinguishes the following business models:

• Business model whose objective is to retain the financial asset until maturity and collect contractual cash flows;
• Business model whose objective is achieved simultaneously by collecting contractual cash flows and the sale
of assets; and
• Business model whose objective is to trade the financial asset.

The Bank assesses whether the contractual cash flows represent solely a repayment of principal and interest on the
unpaid portion of principal. Principal is the fair value of the financial asset on initial recognition. Interest reflects the
time value of money, interest rate risk related to the unpaid portion of the principal for the specific period of time
and other basic risks and expenses related to the provision of a loan as well as the profit margin.

If the financial asset is held within a business model with the objective to hold the financial asset until maturity
and to collect contractual cash flows and all these flows simultaneously represent payment of principal and interest
on the unpaid part of principal, the financial asset is classified and valued at amortised cost.

Fio banka, a.s. 11

 Notes to the Financial Statements for the Year Ended 31 December 2021

Amortised cost is the amount at which the asset or liability was measured upon initial recognition, minus principal
repayments, and increased or decreased using the effective interest rate by fees that are an integral part
of a financial instrument, and amortisation of any premium or discount, i.e. the difference between the initial
amount and the amount at maturity, and decreased by a provision for the amount of expected credit losses.

Effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the
expected life of the financial instrument. In calculating the effective interest rate, the Company estimates future
cash flows after considering all of the contractual terms of the financial instrument taking into account all fees and
incremental costs directly attributable to the instrument, which are an integral part of the effective interest rate,
but not taking into account expected credit losses.

Income from debt financial assets measured at amortised cost is reported in the profit and loss account under
“Interest income from debt securities”. If sold, the difference between the selling price and the price before the sale
would be reported in the “Net profit or loss on financial operations” line.

If the financial asset is held within a business model whose objective is achieved simultaneously by collecting
contractual cash flows and the sale of assets and all these flows simultaneously represent payment of principal and
interest on the unpaid part of principal, the financial asset is classified and valued at fair value through valuation
gains and losses. Unrealised gains/losses from this remeasurement are reported in valuation gains and losses as part
of “Valuation gains and losses”.

If the financial asset is held within a business model whose objective is to trade the financial asset or the related
cash flows do not represent solely payment of principal and interest on the unpaid part of principal, irrespective
of the business modal, the financial asset is classified and valued at fair value through profit or loss. Gains/losses
from this remeasurement are reported in the profit and loss account as part of “Net profit or loss on financial
operations”.

The fair value used for the revaluation of securities is set as the arm’s length price promulgated as of the date
of determination of the fair value, provided that the Bank proves that the security can be sold for the arm’s length
price.

Levels of fair value determination:

1) Price of securities on active markets

2) Price on other markets or price derived from them

3) Price not derived from the market, rather for example by the Bank’s model

In case of publicly tradable debt securities and equity securities, fair values are equal to prices achieved on a public
market of OECD countries, provided that the requirements for the liquidity of the securities are met at the same
time.

Repo transactions (i.e. the sales of securities with a concurrent commitment to repurchase these securities
at an agreed-upon price) or reverse repo transactions (i.e. the purchase of securities with a concurrent commitment
to resell these securities) are accounted for as collateralised loans received or provided. The ownership title
to securities is passed to the entity providing the loan. Securities transferred within repo transactions continue to
be presented as part of securities in the relevant lines of the Company’s balance sheet and the amount obtained as
a result of transferring securities within repo transactions is recognised under ‘Due to banks’ or ‘Due to customers’.
Securities received within reverse repo transactions are only presented in off-balance sheet accounts in the line
‘Received pledges and collateral’. The loan granted within reverse repo transaction is presented in the line ‘Loans
and receivables to banks’ or ‘Loans and receivables to customers’. The interest on debt securities transferred within
repo transactions is accrued, as opposed to the interest on debt securities obtained within reverse repo transactions.

Income or expense arising from repo transactions or reverse repo transactions as the difference between the selling
and purchase price is accrued over the term of the transaction and recorded in ‘Interest income and similar income’
or ‘Interest expense and similar expense’ in the profit and loss account.

Fio banka, a.s. 12

 Notes to the Financial Statements for the Year Ended 31 December 2021

Debt financial assets held by the Bank as of the balance sheet date are included in the business model
with the objective to hold the financial asset until maturity and to collect contractual cash flows and concurrently
in the business model with the objective of financial asset trading.

Debt financial assets are recognised in amounts net of provisions. Provisions from impairment of debt securities are
determined based on the model of expected losses based on the requirements of IFRS 9. In order to determine
expected losses the Bank divides debt financial assets into three categories based on the level of risk:

• Stage 1 – this category includes debt securities whose credit risk had not significantly increased since initial
recognition as of the balance sheet date. Impairment of financial assets is determined as expected credit loss
over 12 months after the balance sheet date. Interest income is calculated on a straight-line basis using the
current interest rate and it is determined from the gross carrying amount of the asset.
• Stage 2 – this category includes debt securities whose credit risk had significantly increased since initial
recognition as of the balance sheet date, but default had not occurred. Impairment of financial assets is
determined as expected credit loss until maturity. Interest income is calculated using the effective interest rate
method and it is determined from the gross carrying amount of the asset.
• Stage 3 – this category includes debt securities in default. Impairment of financial assets is determined
as expected credit loss until maturity of the asset. Interest income is calculated using the effective interest rate
method and it is determined from the net carrying amount of the asset, taking into account the provision.

A separate category includes purchased or originated credit impaired (POCI) assets. POCI assets are financial assets
that are credit impaired already on initial recognition and they are reported in net value throughout the lifetime
of the asset without the option of transfer to the other risk categories. Impairment of these financial assets is
determined as the expected credit loss until maturity. Income is determined using the effective interest rate adjusted
for the credit risk.

A material increase in credit risk is considered to be an event where the debtor is in default by 30 or more days since
the maturity of the contractual payment.

The Bank considers assets to be impaired if the debtor is in default by 90 or more days since the maturity of the
contractual payment.

Provisions are charged to expenses, and they are reported under “Write-offs, charge for, and use of provisions and
reserves for receivables and guarantees.”

Write-off of irrecoverable receivables is included in “Write-offs, charge for, and use of provisions and reserves for
receivables and guarantees.” Income from previously written-off financial assets is included in the profit and loss
account under “Release of provisions and reserves for receivables and guarantees, recoveries of receivables
assigned, and recoveries of receivables previously written off.”

Default interest on receivables in default is presented in off-balance sheet accounts.

Operating and other receivables are immaterial from the Bank’s perspective; for this reason, the Company
recognises full provisions for operating and other receivables when they are past their due dates by more than
a year.

3.2.2. Shares, Share Certificates and Other Equity Investments

Equity financial assets are classified and measured at fair value in line with IAS 39 through profit or loss under

Fio banka, a.s. 13

 Notes to the Financial Statements for the Year Ended 31 December 2021

“Net profit or loss on financial operations”, unless the Bank decided on initial recognition of this asset to classify and
measure it at fair value reported in valuation gains and losses under “Valuation gains and losses” without the option
of reclassification of the accumulated change in fair value from valuation gains and losses to profit or loss. Dividends
from equity securities are always reported in the profit and loss account under “Net profit or loss on financial
operations”.

3.2.3. Financial Derivatives

Financial derivatives include the following financial instruments:

• with zero or low initial investment;

• with their fair value changing according to the changes in the interest rate, price of a security, price
of a commodity, exchange rate, price index, or a similar variable;
• which are agreed and settled as of the future date.

Financial derivatives are reported at fair values and in their nominal values off balance sheet. The fair value is
determined based on quoted market prices or valuation models that reflect the current market and contractual
value of an underlying instrument as well as the time value and yield curve.

Derivatives are recognised in both off-balance sheet and balance sheet accounts from the moment they are agreed
until they are settled, terminated, applied, sold or repurchased.

Derivatives are reported at their fair values in “Other assets” and “Other liabilities”. Realised and unrealised gains
and losses are included in the profit and loss account under “Net gains and losses on financial operations”.

Fio banka uses financial derivatives to hedge against the currency risk to which it is exposed due to its financial
market operations, it does not classify them as hedging from the accounting perspective and they are reported
as derivatives held for trading when gains and losses from revaluation to fair value are reported in “Net gains and
losses on financial operations”.

3.3. Financial Liabilities

Due to banks and cooperative credit unions and due to customers are measured at amortised cost. Financial
liabilities are derecognised when they cease to exist.

A financial liability or its part ceases to exist if the obligation defined by a contract is fulfilled, cancelled or its validity
ends, and the reporting entity will no longer report the financial liability or its part in the balance sheet. The
difference between the value recorded in accounting of a liability or its part that ceased to exist or was transferred
to another entity and the amount paid for this liability is recognised in profit or loss.

3.4. Issued Debt Securities

In 2021, the Bank issued bonds in compliance with MREL for the purposes of meeting regulatory requirements.
These securities are measured at amortised cost and reported as liabilities from debt securities.

3.5. Transactions with Securities on behalf of Clients

Securities received by the Company into custody, administration or safe-keeping are recorded at market value and
reported within the off balance sheet line ‘Assets received into custody, administration and safe-keeping’.

Securities received by the Company for management are recorded at market value and reported within
the off balance sheet line ‘Assets received for management’. On the balance sheet, liabilities include the Company’s
payables to clients arising principally from cash received to purchase securities, cash to be refunded to the client,
etc.

Fio banka, a.s. 14

 Notes to the Financial Statements for the Year Ended 31 December 2021

3.6. Investments in Subsidiaries and Associates

Investments in subsidiaries refer to investments in an entity in which the Company is a majority shareholder. In such
a case, the Company has controlling influence on the entity’s management, exercising full control over its activity.
The influence is based on the ownership percentage or an agreement or the Articles regardless of the participation
interest value.

Investments in associates refer to investments in an entity in which the Company has ownership percentage
(participation) of at least 20%. In such a case, the Company has substantial influence on the entity’s management
arising from ownership percentage or an agreement or the Articles regardless of the participation interest value.

Participation interests in subsidiaries and associates are recorded at acquisition cost which also includes direct costs
related to the acquisition. At the balance sheet date, the Company measures participation interests using the equity
method of accounting. The equity investment recognised at cost on acquisition is revalued at the balance sheet date
to reflect the value equivalent to the Company’s proportion of a subsidiary/associate’s equity.

In 2021, Družstevní záložna PSD was liquidated. For this reason, the Bank no longer includes it in the list
of investments in subsidiaries. At the moment of disposal, the difference between the value of the investment and
the amount of the paid liquidation balance is reported in “Share of profits/(losses) of subsidiaries and associates”.

3.7. Charge for Reserves

Reserves represent a probable performance which is uncertain as to the date on which it will arise and as to its
amount. The Bank recognises a reserve when:

- It has a present performance obligation (legal or constructive) as a result of a past event;

- It is probable that an outflow of resources embodying economic benefits will be required to settle
the obligation whereby “probable” refers to the probability of more than 50 percent; and
- A reliable estimate as to the amount of the obligation can be made.

3.8. Tangible and Intangible Assets

Tangible and intangible assets are recognised at historical cost and depreciated over the estimated useful life using
the straight-line method.

Depreciation method Number of months

Development Straight-line 36
Software Straight-line 36
Technical improvements on buildings Straight-line 108
Computer systems Straight-line 36
Vehicles Straight-line 36
Furniture and fixtures Straight-line 36
Other Straight-line 36-120

Intangible assets with an acquisition cost lower than CZK 60 thousand and tangible assets with an acquisition cost
greater than CZK 80 thousand and with useful life not exceeding one year are expensed in the period in which they
were acquired.
Depreciation of leases under IFRS 16 is further discussed in note 3.15 Lease measurement under IFRS 16.

3.9. Foreign Currency Translation

Transactions denominated in foreign currencies are recorded in the local currency at the exchange rate prevailing
on the date of the transaction. Assets and liabilities denominated in foreign currencies and foreign exchange spot
transactions before their due dates are translated into the local currency at the exchange rate
of the Czech National Bank prevailing on the balance sheet date.

Fio banka, a.s. 15

 Notes to the Financial Statements for the Year Ended 31 December 2021

The resulting gain or loss arising from the translation of assets and liabilities denominated in foreign currencies,
except for participation interests in foreign currencies, is presented in the profit and loss account line ‘Net profit or
loss on financial operations’.

3.10. Taxation

The income tax base is calculated using the operating result of the current period increased by tax non-deductible
expenses and net of income that is not subject to the income tax which is further adjusted by tax relief and tax credit,
if any. Tax receivables and payables are calculated using the tax rate effective at the year-end and recognised in the
amount of the estimated payment to be made to the relevant tax authority.

Deferred tax is based on all temporary differences between the carrying and tax values of assets and liabilities using
the anticipated tax rate effective for the subsequent period. Deferred tax assets are only recognised and accounted
for if no doubt exists as to their recovery in the following reporting periods.

3.11. Interest Income and Expense

Interest income and expense is presented in the profit and loss account when earned or incurred, on an accruals
basis. Interest on loans and deposits is accrued on a daily basis. Interest income and expense also involve a discount
or a bonus, or other differences between the acquisition cost of the interest-bearing instrument and its value at the
maturity date which is determined using the effective interest rate method.
The accruals principle does not apply to default interest on distressed receivables. For this reason, such default
interest is not included in the Bank’s income for a particular period.

3.12. Fees and Commissions

The recognition of fee and commission income depends on the purpose for which they were imposed and accounting
treatment of a related financial instrument.

Depending on the substance of a fee and type of provided services, the Bank classifies fees and commissions into
the following groups:

• fees and commissions thar are an integral part of the effective interest rate of a financial instrument and which
are reported in Interest income using the effective interest rate;
• fees and commissions for provided services and execution of an act such as fees for deposit products, fees for
services relating to loans, income fees from provided transactions, income fees from cross selling of third party
products (such as insurance and investment products where the Bank is an intermediary given that it does not
assume control over the provided products, i.e. involving net recognition of income), fees from specialised financial
services. The income from these fees is recognised when the relevant services are provided or an act executed. If
they relate to a longer time period, they are recognised evenly over this period. Fees and commissions are recognised
in Net income from fees and commissions.

3.13. Use of Estimates

The presentation of financial statements in line with Czech Accounting Standards requires the Company’s
management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the
balance sheet date, the information disclosed on contingent assets and liabilities and the reported amounts of
revenues and expenses during the reporting period.

These estimates, which predominantly involve determining the fair value of financial instruments, measurement
of intangible assets, impairment of assets and reserves, are based on the information available at the balance sheet
date. Management of the Company has made these estimates and assumptions on the basis of all the relevant
information available to it.

Fio banka, a.s. 16

 Notes to the Financial Statements for the Year Ended 31 December 2021

At the beginning of 2021, the Bank started to use the standard methodology of estimating the development in
exposure categorisation and exposure stages in time without the use of sector stress tests in segments affected by
the pandemic.

Unlike the methods used during the pandemic year 2020, the Bank abandoned the segment approach and returns
to fully individualised assessment of individual cases. It decided to use the experience gained in the pandemic, and
the tools created in those times, only for monitoring because of both the possibility of another wave of the pandemic
and, for example, possible structural difficulties in the economy (war in Ukraine, real estate market, disrupted
customer chains in commodities, etc.) that could affect, or have already partially affected, some segments more
than other ones. The use of this method makes the Bank capable of responding faster to possible problems of clients
and proposing individual solutions to them.

3.14. Uncertainty of Estimates and Parameters Used (PD, ECL and Applied Macroeconomic
Scenarios)

Significant estimates in the application of the reporting entity’s methodology and policies are affected by external
uncertainty regarding the development in interest rates, exchange rates, commodity prices and inflation
expectations relating to the pandemic fading away and the geopolitical conflict in Ukraine. They may thus differ from
those made at the end of the preceding reporting period, especially in the area of expected credit losses (ECL). The
most recent Financial Stability Report can be suitably approximated as a benchmark for macroeconomic analyses,
but for the Bank’s accounting practice and prudence, these estimates have to be additionally adjusted in response
to the current development.

The Bank performs this adjustment as a combination of internal parameters and parameters disclosed
in the Financial Stability Report. These adjustments of estimates then gradually enter into the calculation of internal
PD for individual credit products, conceived as a combination of internal metrics (analyses of historical data,
increased by the predicted market deterioration in line with the Financial Stability Report) and the values generally
recommended by the supervisory authority. PD was generally selected based on the internal methodology multiplied
by the year-on-year growth coefficient of the Financial Stability Report, unless this would lead to an unrealistic
improvement or deterioration compared to the coefficients used in the past, which was the case for example for
mortgages, whose risk level is already based on the Bank’s historical data significantly below the market level (caused
by the short history of providing the product).

3.15. Lease Measurement under IFRS 16

The Company assesses whether a contract is or contains a lease at the inception of the contract. The Company
recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it
is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low
value assets (such as tablets and personal computers, small items of office furniture and telephones). Short-term
leases are reported in the “Other administrative expenses” line. For these leases, the Company recognises the lease
payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis
is more representative of the time pattern in which economic benefits from the leased assets are consumed.

The lease liability is initially measured at the present value of the lease payments that are not paid
at the commencement date, discounted by the rate implicit in the lease. If this rate cannot be readily determined,
the lessee uses its incremental borrowing rate.

Lease payments included in the measurement of the lease liability comprise:

• Fixed lease payments (including in-substance fixed payments), less any lease incentives receivable;
• Variable lease payments that depend on an index or rate, initially measured using the index or rate
at the commencement date;
• The amount expected to be payable by the lessee under residual value guarantees;
• The exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
• Payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate
the lease.

Fio banka, a.s. 17

 Notes to the Financial Statements for the Year Ended 31 December 2021

The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability
(using the effective interest method) and by reducing the carrying amount to reflect the lease payments made.

The Company remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use
asset) whenever:
• The lease term has changed or there is a significant event or change in circumstances resulting in 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 a revised discount rate.
• The 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 lease liability is remeasured by discounting the revised lease
payments using an unchanged 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).
• A lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case
the lease liability is remeasured based on the term of the modified lease by discounting the revised lease
payments using a revised discount rate at the effective date of the modification.

The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made
at or before the commencement day, less any lease incentives received and any initial direct costs. They are
subsequently measured at cost less accumulated depreciation and impairment losses.

Whenever the Company incurs an obligation for costs to dismantle and remove a leased asset, restore the site on
which it is located or restore the underlying asset to the condition required by the terms and conditions of the lease,
a provision is recognised and measured under IAS 37. To the extent that the costs relate to a right-of-use asset, the
costs are included in the related right-of-use asset, unless those costs are incurred to produce inventories.

Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset.
If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Company
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.

In applying IFRS 16, for all leases (except short-term leases and leases of low-value assets), the Company:

(a) recognises right-of-use assets and lease liabilities in the statement of financial position, which are presented
on the balance sheet lines Tangible fixed assets, Land and buildings for operating activities and Other liabilities;
(b) recognises depreciation of right-of-use assets and interest on lease liabilities in the statement of profit or loss
on lines Write-offs, charge for and use of provisions and reserves for tangible and intangible fixed assets
and Interest expense and similar expense.

Fio banka, a.s. 18

 Notes to the Financial Statements for the Year Ended 31 December 2021

4. ADDITIONAL INFORMATION ON THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT

4.1. Cash in Hand and Balances with Central Banks

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Cash in hand 187 376 182 567
Accounts at central banks 3 156 132 1 189 216
Loans provided – reverse repo transactions 50 000 000 78 343 000
Cash in ATMs 1 710 474 1 372 033
Total 55 053 982 81 086 816

As of 31 December 2021, loans arising from reverse repo transactions were secured by debt securities in the fair
value of CZK 49,892 thousand (CZK 76,938,000 thousand as of 31 December 2020).

4.2. State Zero-coupon Bonds and Other Securities Eligible for Refinancing with the Central
Bank

As of 31 December 2021, the Company held state treasury bills of CZK 0 thousand (2020: CZK 2,571,771 thousand).

4.3. Loans and Receivables to Banks and Cooperative Credit Unions

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Current accounts 1 687 469 1 470 744
Term deposits 601 385 444 322
Total loans and receivables to banks and cooperative credit unions 2 288 854 1 915 066

All loans and receivables to banks and cooperative credit unions are categorised as Stage 1. No provision was
recognised in respect of these assets due to immateriality.

4.4. Loans and Receivables to Customers

By contractual maturity
(CZK ‘000)
31 Dec 2021 31 Dec 2020
Short-term loans 18 837 433 13 989 897
Medium-term loans 786 469 496 397
Long-term loans 17 829 715 11 658 699
Total loans and receivables to customers 37 453 617 26 144 993

By territory
(CZK ‘000)
31 Dec 2021 31 Dec 2020
Czech Republic 29 899 207 20 732 105
Slovakia 6 974 887 5 289 873
Other countries 579 523 123 015
Total loans and receivables to customers 37 453 617 26 144 993

By type of client
(CZK ‘000)
31 Dec 2021 31 Dec 2020
Individuals 15 979 980 9 765 921
Legal entities 21 473 637 16 379 072
Total loans and receivables to customers 37 453 617 26 144 993

Fio banka, a.s. 19

 Notes to the Financial Statements for the Year Ended 31 December 2021

By segment
(CZK ‘000)
31 Dec 2021 31 Dec 2020
Households 15 276 024 9 170 355
Real estate 7 170 554 4 262 728
Finance 679 871 740 039
Services 8 840 041 7 836 461
Sundry 5 487 127 4 135 409
Total loans and receivables to customers 37 453 617 26 144 993

By classification

2021
(CZK ‘000)
31 Dec 2021 31 Dec 2020
Gross Provision Net Net
Stage 1 32 381 718 148 271 32 242 428 20 251 832
Stage 2 3 030 339 105 922 2 924 417 3 566 082
Stage 3 3 262 829 1 069 763 2 184 085 2 327 079
POCI 124 621 i 21 934 102 687 0
Total loans and receivables to customers 38 799 507 1 345 890 37 453 617 26 144 993

2020
(CZK ‘000)
31 Dec 2020 31 Dec 2019
Gross Provision Net Net
Stage 1 20 316 496 64 664 20 251 832 17 966 280
Stage 2 3 770 399 204 317 3 566 082 793 381
Stage 3 3 554 740 ii 1 227 661 2 327 079 1 388 647
Total loans and receivables to customers 27 641 635 1 496 642 26 144 993 20 148 308

i There were primarily the following reasons for the provision of new receivables, or an increase in receivables of clients in stage 3:

a) from the Bank’s perspective, it was assessed to be more profitable to continue the project implementation (e.g. completion of a development
plan or financing of other engagements of a client) and consequently increase the yield from the collateral or provide the client with further
financing to increase the likelihood of receivable recovery (rather than making the loan payable and sell the collateral in the current less liquid
state)

b) provision of operational financing to clients affected by COVID-19, or COVID-19 measures where the prerequisite for the proper continuation
of the plan (repayment of the loan) after the measures are cancelled was assessed

c) restructuring of loans
ii There were primarily the following reasons for the provision of new receivables, or an increase in receivables of clients in stage 3:

a) from the Banks perspective, it was assessed to be more profitable to continue the project implementation (e.g. completion of a development
plan or financing of other engagements of a client) and consequently increase the yield from the collateral or provide the client with further
financing to increase the likelihood of receivable recovery (rather than making the loan payable and sell the collateral in the current less liquid
state)

b) provision of operational financing to clients affected by COVID-19, or COVID-19 measures where the prerequisite for the proper continuation
of the plan (repayment of the loan) after the measures are cancelled was assessed

c) restructuring of loans

Fio banka, a.s. 20

 Notes to the Financial Statements for the Year Ended 31 December 2021

The following table shows the reasons for changing the gross value by risk category:

Stage 1 Stage 2 Stage 3 POCI Total

Gross value at 31 Dec 2020 20 316 496 3 770 399 3 554 740 0 27 641 635
Change of provision due to
- Transfer to Stage 1 831 253 -802 000 -29 253 0
- Transfer to Stage 2 -482 521 1 244 878 -762 357 0
- Transfer to Stage 3 -452 915 -632 936 1 085 851 0
- POCI -10 090 33 979 -66 255 96 664 54 298
- Newly originated loans and receivables
12 475 114 10 131 44 615 27 957 12 557 817
to customers
- Derecognised loans and receivables to
-2 521 493 -446 094 -538 823 -3 506 410
customers
- Increase of receivables without change
3 681 314 180 374 109 196 3 970 884
of stage
- Decrease of receivables without change
-1 455 440 -328 392 -134 885 -1 918 717
of stage
Gross value at 31 Dec 2021 32 381 718 3 030 339 3 262 829 124 621 38 799 507

The following table shows the reasons for changing provisions by risk category.

Stage 1 Stage 2 Stage 3 POCI Total

Provision balance at 31 Dec 2020 64 664 204 317 1 227 661 0 1 496 642
Change of provision due to
- Transfer to Stage 1 29 545 -29 002 -543 0
- Transfer to Stage 2 -8 678 111 462 -102 784 0
- Transfer to Stage 3 -41 332 -20 777 62 109 0
- POCI -21 783 29 369 7 586
- Newly acquired financial assets 93 775 7 841 37 696 21 934 161 246
- Derecognised financial assets 54 339 -18 032 -221 247 -184 940
- Increase in credit risk 22 570 47 649 169 375 239 594
- Decrease in credit risk -44 829 -197 536 -131 873 -374 238
Provision balance at 31 Dec 2021 148 271 105 922 1 069 763 21 934 1 345 890

Loans and receivables to customers are secured by real estate, movable property, securities, receivables from third
parties, state guarantees, etc. in the aggregate amount of CZK 25,829,044 thousand as of 31 December 2021
(31 December 2020: CZK 19,549,498 thousand).

During 2021, the Company released provisions against receivables from clients in the amount
of CZK 559,184 thousand and created provisions against receivables from clients in the amount
of CZK 408,432 thousand.

Impacts of the COVID-19 pandemic:

In order to mitigate the impact of COVID-19, laws were approved in the Czech Republic and Slovakia allowing
the deferment of loan payments. The bank provided payment deferment with respect to COVID-19 in line with
the following legislation:

• Act No. 177/2020 Coll., on Certain Measures in the Area of Loan Repayment in Relation to the COVID-19
Pandemic, approved in the Czech Republic;
• Act No. 67/2020 Coll., as amended by Act No. 75/2020, on Certain Extraordinary Measures in the Financial Area
in Relation to the Spread of the Dangerous Contagious Human Disease COVID-19, approved in Slovakia.

Fio banka, a.s. 21

 Notes to the Financial Statements for the Year Ended 31 December 2021

4.5. Debt Securities

(CZK ‘000)
Debt securities at amortised cost 31 Dec 2021 31 Dec 2020
Government bonds 117 689 478 68 581 708
Total at amortised cost 117 689 478 68 581 708

Debt securities at fair value through profit or loss 31 Dec 2021 31 Dec 2020
Government bonds 170 142 0
Non-government bonds 18 230 0
Total at fair value through profit or loss 188 372 0

31. 12. 2021 31. 12. 2020

Total debt securities 117 877 850 68 581 708

Debt securities in the Company’s portfolio were issued predominantly in the Czech Republic.

All debts securities are classified in Stage 1. The provision against debt securities at amortised cost was not reported
as of the balance sheet date due to immateriality.

4.6. Shares, Share Certificates and Other Equity Investments

Shares, Share Certificates and Other Equity Investments 31 Dec 2021 31 Dec 2020
Fair value through valuation gains or losses 9 555 1 169
Fair value through profit or loss 194 193 179 876
Total 203 748 181 045

Securities at fair value through valuation gains and losses

The Bank used the option to classify these securities on initial recognition in the portfolio as financial assets at fair
value through valuation gains and losses. The Bank did so since it plans to hold these equity securities in the long
term and does not plan to trade them.

As of 31 December 2021, the Company received 100 shares of Burza cenných papírů Praha, a.s. with the carrying
value of CZK 100 thousand (2020: CZK 100 thousand), 9 S.W.I.FT. SCRL shares of CZK 1,355 thousand (2020: 1,069
thousand) and 150 pieces of Bankovní identita a.s. with the carrying value of CZK 8,100 thousand (2020: CZK 0
thousand).

4.7. Investments in Subsidiaries

2021
(CZK ‘000)
Name of the company Registered office Acquisition Ownership Voting Valuation at
cost percentage rights in % 31 Dec 2021
RM-SYSTÉM, česká burza Praha 1, V Celnici 1028/10, 31 705 100 100 42 133
cenných papírů a.s. Postal code 117 21
Praha 1, V Celnici 1028/10, 991 100 100 4 493
RM-S FINANCE, s.r.o.
Postal code 117 21
Praha 1, V Celnici 1028/10 210 100 100 3 200
Fio forexová, s.r.o.
Postal code 117 21
Praha 1, V Celnici 1028/10, 20 000 100 100 20 756
Fio investiční společnost, a.s.
Postal code 110 00
Praha 1, V Celnici 1028/10, 500 100 100 926
Fio Consulting, spol. s.r.o.
Postal code 117 21
Praha 1, V Celnici 1028/10, 100 100 100 100
Fio realitní fond SICAV, a.s.
Postal code 117 21
Total 53 506 71 608

Fio banka, a.s. 22

 Notes to the Financial Statements for the Year Ended 31 December 2021

2020
(CZK ‘000)
Name of the company Registered office Acquisition Ownership Voting Valuation at
cost percentage rights in % 31 Dec 2020
RM-SYSTÉM, česká burza Prague 1, V Celnici 1028/10, 31 705 100 100 38 730
cenných papírů a.s. Postal Code 117 21
Prague 1, V Celnici 1028/10, 991 100 100 1 951
RM-S FINANCE, s.r.o.
Postal Code 117 21
Družstevní záložna PSD Prague 1, V Celnici 1028/10, 58 744 73,4 73,4 102 362
v likvidaci Postal Code 117 21
Prague 1, V Celnici 1028/10 210 100 100 3 576
Fio forexová, s.r.o.
Postal Code 117 21
Prague 1, V Celnici 1028/10, 20 000 100 100 16 414
Fio investiční společnost, a.s.
Postal Code 110 00
Prague 1, V Celnici 1028/10, 500 100 100 756
Fio Consulting, spol. s.r.o.
Postal Code 117 21
Total 112 150 163 789

Upon acquisition, the Company recognises the acquired share or participation interest at cost. At the balance sheet
date, the Company records participation interests at the value established using the equity method of accounting.
The equity investment recognised at cost on acquisition is revalued at the balance sheet date to reflect the value
equivalent to the Company’s proportion of a subsidiary/associate’s equity. The revaluation difference at the balance
sheet date is presented in the line ‘Share of profits/(losses) of subsidiaries and associates’.

In 2021, Družstevní záložna PSD was liquidated; for this reason, the Bank no longer includes it in the list
of investments in subsidiaries.

As a collateral for receivables, shares and equity investments in some companies have been temporarily transferred
to Fio banka, a.s. Although these companies are legally owned by Fio banka, a.s., they do not meet the conditions
of the relevant legislation to be included in the balance sheet of Fio banka, a.s., since based on relevant concluded
contracts Fio banka, a.s. does not control or manage the relevant activities of these companies and these companies
therefore do not represent controlled entities or entities under joint control, and Fio banka, a.s. cannot be seen as
an entity with substantial influence with respect to them.

Družstevní záložna PSD went into liquidation on 1 October 2020. It paid the liquidation balance before the end
of 2021 and therefore is no longer included in investments in subsidiaries as of 31 December 2021.

In December 2021, the share capital of CZK 100 thousand of newly formed Fio realitní fond SICAV, a.s. was paid. It
does not yet allow the receipt of deposits.

4.8. Fixed Assets

4.8.1. Intangible Fixed Assets (Intangible FA)

Cost
(CZK ‘000)
31 Dec 2019 Additions Disposals 31 Dec 2020 Additions Disposals 31 Dec 2021
Software 21 869 0 0 21 869 0 0 21 869
Acquisitions of 2 240 329 0 2 569 900 1 229 2 240
intangible FA
Other intangible FA 11 701 0 0 11 701 1 229 0 12 930
Goodwill -1 143 0 0 -1 143 0 0 -1 143
Total 34 667 329 0 34 996 2 129 1 229 35 896

Fio banka, a.s. 23

 Notes to the Financial Statements for the Year Ended 31 December 2021

Accumulated Amortisation
(CZK ‘000)
31 Dec 2019 Additions Disposals 31 Dec 2020 Additions Disposals 31 Dec 2021
Software 19 907 1 812 0 21 719 148 0 21 867
Other intangible FA 11 701 0 0 11 701 246 0 11 947
Goodwill -1 143 0 0 -1 143 0 0 -1 143
Total 30 465 1 812 0 32 277 394 0 32 671

Net Book Value

(CZK ‘000)
31 Dec 2020 31 Dec 2021
Software 150 2
Acquisitions of 2 569 2 240
intangible FA
Other intangible FA 0 983
Goodwill 0 0
Total 2 719 3 225

The Company’s negative goodwill originated on the acquisition of enterprises. The Company purchased enterprises
for a price determined based on an expert’s opinion which was lower than the difference between the transferred
assets and liabilities.

4.8.2. Tangible Fixed Assets (Tangible FA)

Cost
(CZK ‘000)
31 Dec 2019 Additions Disposals 31 Dec 2020 Additions Disposals 31 Dec 2021
Vehicles 5 209 358 359 5 208 663 173 5 698
Acquisitions of tangible 8 746 13 159 8 746 13 159 1 446 0 14 605
FA
Lease under IFRS 16 256 348 271 186 0 567 586* 38 884 118 141 488 329
ATMs 0 17 698 0 17 698 26 230 0 43 928
Other tangible FA 57 965 34 334 10 882 81 477 7 995 8 365 81 107
Total 328 268 336 735 19 927 685 128 75 218 126 679 633 667

Accumulated Depreciation
(CZK ‘000)
31 Dec 2019 Additions Disposals 31 Dec 2020 Additions Disposals 31 Dec 2021
Vehicles 1 427 1 144 0 2 571 1 137 173 3 535
Lease under IFRS 16 42 622 53 374 0 136 048* 86 050 4 803 217 295
ATMs 0 1 432 0 1 432 5 472 27 6 877
Other tangible FA 40 341 5 231 72 45 500 5 435 0 50 935
Total 84 390 61 181 72 185 551 98 094 5 003 278 642

*The gross balance and accumulated depreciation at the end of 2020 was adjusted to correctly
correspond to the actual status under IFRS 16 as of 31 December 2020.

Net Book Value

(CZK ‘000)
31 Dec 2020 31 Dec 2021
Vehicles 2 637 2 163
Acquisitions of 13 159 14 605
tangible FA
Lease under IFRS 16 431 538 271 034
ATMs 16 266 37 051
Other tangible FA 35 977 30 172
Total 499 577 355 025

Fio banka, a.s. 24

 Notes to the Financial Statements for the Year Ended 31 December 2021

In the year ended 31 December 2021, the Company acquired tangible assets in the amount of CZK 12,853 thousand
charged directly to expenses (31 December 2020: CZK 13,696 thousand). These assets principally include low-value
tangible assets composed of other movable assets and their sets with useful life exceeding one year which are not
recognised under fixed assets but are directly expensed.

4.9. Other Assets

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Provided deposits and prepayments 609 362 618 544
Receivables from securities markets 242 339 195 618
Estimated receivables 10 171 26 263
Guarantee funds 1 577 1 452
Margin contribution for derivatives trading 8 510 52 802
Positive fair value of open derivatives (FX swap) 44 230 30 118
Cash in transit 75 629 47 078
Corporate income tax 282 565 319 210
Other 9 027 52 599
Total other assets 1 283 410 1 343 684

Provisions are created against receivables past their due dates by more than one year and presented in the line
‘Other’.

The positive fair value of open derivatives is based on a receivable from fixed term transactions in the nominal value
amounting to CZK 5,090,476 thousand (2020: CZK 17,167,578 thousand) and a payable from fixed term transactions
in the nominal value amounting to CZK 5,059,457 thousand (2020: CZK 17,137,836 thousand).

Cash in transit is predominantly composed of resources for the funding of branches and ATMs.

Provided deposits and prepayments

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Fio leasing, a.s., a deposit paid for the lease term 16 364 14 294
Deposits paid to card associations 561 802 549 501
Other 31 196 56 524
Total deposits and prepayments 609 362 620 319

4.10. Prepayments and Accrued Income

As of 31 December 2021, prepayments and accrued income amount to CZK 93,648 thousand (31 December 2020:
CZK 46,055 thousand) and predominantly include costs of a media campaign in the amount of CZK 29,961 thousand
and interest on repo transactions of CZK 44,875 thousand.

4.11. Due to Banks and Cooperative Credit Unions

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Repayable on demand 139 164 224 458
Other 45 0
Total 139 209 224 458

Fio banka, a.s. 25

 Notes to the Financial Statements for the Year Ended 31 December 2021

4.12. Due to Customers

(CZK ‘000)
31 Dec 2021 31 Dec 2020
Repayable on demand 200 194 577 171 285 699
Other 3 202 093 3 574 493
Total due to customers 203 396 670 174 860 192

4.13. Other Liabilities

(CZK ‘000)
31 Dec 2021 31 Dec 2020
A deficit on the fair value of open derivatives (FX swap) 565 861 7 212
Outgoing payments 763 052 753 805
Payables to securities markets 168 2 852
Payables to employees 40 384 31 801
Estimated payables 46 495 50 892
Payables to the state budget 30 774 22 996
Domestic suppliers 20 788 45 692
Foreign suppliers 15 895 14 462
Payables arising from accounting for leases under IFRS 16 282 267 445 583
Unidentified contributions 14 222 11 903
Other 245 706 83 448
Total other liabilities 2 025 612 1 470 646

The negative fair value of open derivatives is based on a receivable from fixed term transactions in the nominal value
of CZK 26,670,294 thousand (2020: CZK 3,596,051 thousand) and a payable from fixed term transactions
in the nominal value of CZK 27,286,006 thousand (2020: CZK 3,603,180 thousand).

The item ‘Other’ saw an increase due to the received part of consideration amounting to CZK 190 million arising
from a loan assignment agreement that took effect with the payment of the total purchase price made in 2022.

Amounts due arising from social security and health insurance contributions

As of 31 December 2021, the amount due arising from the contribution to social security and state employment
policy was CZK 2,933 thousand (31 December 2020: CZK 4,435 thousand). The Company records no payables past
their due dates arising from the contribution to social security and state employment policy.

As of 31 December 2021, the amount due arising from health insurance contributions was CZK 7,454 thousand
(31 December 2020: CZK 6,152 thousand). The Company records no payables past their due dates arising from health
insurance contributions.

4.14. Reserves

As of 31 December 2021, reserves in the amount of CZK 504,686 thousand (31 December 2020:
CZK 292,166 thousand) principally comprises a reserve for the corporate income tax of CZK 502,217 thousand,
a reserve for outstanding vacation days of CZK 1,930 thousand and a reserve for court disputes of CZK 539 thousand.

31 Dec 2020 Release Charge 31 Dec 2021

Income tax reserve 286 764 286 764 502 217 502 217
Reserve for court disputes 539 0 0 539
Reserve for outstanding vacation days 2 847 2 847 1 930 1 930
Total 290 150 289 611 504 147 504 686

4.15. Subordinated Liabilities

As of 31 December 2021, the Company records a subordinated liability of CZK 90,000 thousand (2020: CZK
90,000 thousand). This liability bears interest at 15% p. a. with a notice period of 5 years.

Fio banka, a.s. 26

 Notes to the Financial Statements for the Year Ended 31 December 2021

4.16. Liabilities from Debt Securities

In December 2021, the Company issued its own bonds in order to meet the MREL requirements.
As of 31 December 2021, it subscribed bonds in the amount of CZK 588,718 thousand.

4.17. Equity

The Company’s share capital comprises 760 thousand ordinary shares with a nominal value of CZK 1 thousand.

As of 31 December 2021, CZK 760 thousand was paid.

The Company’s share capital was fully paid as of 19 December 2014.

In the years ended 31 December 2021 and 31 December 2020, no increase was made in the Company’s share capital
by the subscription of shares.

As of 31 December 2021 and 31 December 2020, no treasury shares were held by the Company.

Based on the recommendation of the Czech National Bank, the Company did not pay out dividends in the year ended
31 December 2021.

Distribution of Profit

Based on a decision of the sole shareholder acting in the capacity of the General Meeting, the following distribution
of the 2021 profit was approved:
(CZK ‘000)
2021 2020
Retained earnings brought forward at the beginning of the period 3 665 275 1 862 155
Operating result of prior years 1 176 502 1 803 120
Retained earnings brought forward at the end of the period 4 841 777 3 665 275

At the balance sheet date, the Company did not make any decision as to the distribution of profit for the current
period.

4.18. Interest Expense and Income

(CZK ‘000)
2021 2020
Interest on deposits provided to other banks* 412 095 814 166
Interest on loans provided to clients* 1 002 852 836 649
Interest on debt securities measured at amortised cost* 1 364 518 702 471
Interest on debt securities measured at fair value through profit or loss* 33 983 0
Interest income and similar income 2 813 448 2 353 286
Interest on deposits received from clients 96 063 82 431
Interest on debt securities measured at amortised cost* 190 730 129 582
Interest on the subordinated debt 13 500 13 500
Other interest and interest fee 14 352 114 237
4 858 6 747
Interest expenses arising from leases under IFRS 16
319 503 346 497
Interest expense and similar expense
2 493 945 2 006 789
Net interest income

* This interest is calculated using the effective interest rate

The increase in interest on deposits provided to clients was caused by the increase in interest rates during the latter
half of 2021 and increasing volume of provided loans.

Other interest and interest fees include interest expenses to Fio Forexová, s.r.o. which concludes FX transactions via
Fio banka. The year-on-year decrease in these expenses was due to the lower volume of these FX transactions.

In the years ended 31 December 2021 and 31 December 2020, uncollected default interest on distressed receivables
amounted CZK 342,242 thousand and CZK 333,947 thousand, respectively.

Fio banka, a.s. 27

 Notes to the Financial Statements for the Year Ended 31 December 2021

4.19. Fees and Commissions

(CZK ‘000)
2021 2020
Transactions with securities 199 226 218 260
Other investment services 42 988 18 590
Client accounts and loans 197 290 182 372
Other fees 7 815 27 454
ATM fees 24 543 18 909
Fees charged by card associations 327 759 239 349
799 621 704 934
Total fee and commission income
Payment system and card transactions 208 524 209 787
Transactions with securities 67 257 62 291
Total fee and commission expense 275 781 272 078
Net fee and commission income 523 840 432 856

Other fees include fees from Fio Forexová which concludes FX transactions via Fio banka. The year-on-year decrease
in this income was due to the lower volume of these FX transactions.

4.20. Net Profit or Loss on Financial Operations

(CZK ‘000)
2021 2020
Profit/(loss) on securities -15 097 23 002
Profit on FX differences 1 371 188 715 209
Profit (loss) on proprietary trading 63 743 7 674
Profit/(loss) on currency derivatives -578 069 -57 665
Profit/(loss) on other operations 83 819
Net profit or loss on financial operations 841 848 689 039

4.21. Other Operating Expenses

Other operating expenses amounting to CZK 130,141 thousand (2020: CZK 104,433 thousand) predominantly include
contributions to the Securities Dealers Guarantee Fund, a contribution to the Crisis Resolution Fund, contributions
to the Deposit Insurance Fund. In 2021, the expense of the Securities Dealers Guarantee Fund amounted
to CZK 7,374 thousand (2020: CZK 2,226 thousand). The expense of the Deposit Insurance Fund for 2021 amounted
to CZK 86,141 thousand (2020: CZK 73,411 thousand). A contribution to the Crisis Resolution Fund amounted
to CZK 36,589 thousand (2020: CZK 26,581 thousand).

4.22. Administrative Expenses

(CZK ‘000)
2021 2020
Wages and bonuses 126 529 103 316
Social security and health insurance expenses 31 318 26 515
Other staff costs 1 687 1 411
Staff costs and bonuses 159 534 131 242
Audit 5 552 4 109
Overhead services relating to rental 3 429 7 123
Postage fees 6 376 5 174
Advertising 80 814 89 306
Information resources 6 796 6 202
Outsourced services 387 307 352 654
Other purchased consumables and services 312 101 266 104
Other administrative expenses 802 375 730 672
Total administrative expenses 961 909 861 914

Fio banka, a.s. 28

 Notes to the Financial Statements for the Year Ended 31 December 2021

Bonuses to the Company’s Board of Directors, Supervisory Board and other members of the top management
amounted to CZK 81,953 thousand in 2021 (in 2020: CZK 59,771 thousand).

4.23. Taxation

Income Tax Payable

The Company’s operating result for the year ended 31 December 2021 consisted of the profit before tax amounting
to CZK 2,840,771 thousand (2020: a profit of CZK 1,463,891 thousand).

In the year ended 31 December 2021, the Company’s corporate income tax prepayments amounted
to CZK 282,565 thousand (2020: CZK 319,210 thousand).

The table below sets out adjustments to the profit on ordinary activities before tax to arrive at the income tax base:

(CZK ‘000)
2021 2020
Profit/loss before tax 2 840 771 1 463 891
Expenses not deductible for tax purposes 122 346 151 139
Income not taxable 317 795 105 669
Gifts 2 075 75
Tax base 2 643 246 1 509 286
Tax relief 0 0
Total tax payable 502 217 286 764
Adjustment to the tax payable of prior years -643 102
Change in deferred tax 1 188 523
502 762 287 389
Total

Deferred Tax

As disclosed in Note 3.10, as of 31 December 2021 the Company records a temporary difference between the tax
and net book values of tangible fixed assets and reserves for outstanding vacation days. As of 31 December 2021,
the Company records a deferred tax liability of CZK 1,120 thousand (2020: a deferred tax asset of CZK 68 thousand).

Off-Balance Sheet Transactions

Items recorded on the Company’s off-balance sheet accounts include:

- Securities received for management;

- Securities received for custody, administration and safe-keeping; this constitutes the fair value
of securities deposited on the accounts of the Company’s clients as of the balance sheet date;
- Collateralisation of provided loans;
- Collateralisation of loans from reverse repo transactions;
- Nominal value of open derivatives – receivables and payables arising from currency swaps;
- Unused credit lines; and
- Default interest on loans in Stage 3 under IFRS 9.

4.24. Average Number of Employees and Supervisory Board Members

(number of persons)
2021 2020
Employees 98 86
Of which: members of the Board of Directors 5 5
Members of the Supervisory Board 3 3

Fio banka, a.s. 29

 Notes to the Financial Statements for the Year Ended 31 December 2021

5. Related Party Transactions

Relations with related parties in the Fio Group.

31 December 2021
(CZK ‘000)
RM-SYSTÉM, česká burza Fio consulting s.r.o RM-S FINANCE, Fio investiční společnost,
Fio forexová s.r.o.
cenných papírů a.s. s.r.o. a.s.
Loans and receivables to 0 0 0 0 0
banks and cooperative
credit unions
Other assets 194 0 1 890 2 282 7 500
TOTAL ASSETS 194 0 1 890 2 282 7 500
Due to banks and 0 0 0 0 0
cooperative credit
unions
Other payables 57 440 3 231 659 42 504 24 310
TOTAL LIABILITIES 57 440 3 231 659 42 504 24 310

31 December 2020
(CZK ‘000)
Fio consulting s.r.o Fio investiční Družstevní
RM-SYSTÉM, česká burza RM-S FINANCE,
Fio forexová s.r.o. společnost a.s. záložna
cenných papírů a.s. s.r.o.
PSD
Loans and receivables to 0 0 0 0 0 0
banks and cooperative
credit unions
Other assets 0 18 942 0 0 3 486 0
TOTAL ASSETS 0 18 942 0 0 3 486 0
Due to banks and 0 0 0 0 0 139 550
cooperative credit unions
Other payables 55 725 23 080 721 30 838 318 0
TOTAL LIABILITIES 55 725 23 080 721 30 838 318 139 550

1 January – 31 December 2021

(CZK ‘000)
RM-SYSTÉM, česká burza Fio forexová s.r.o. Fio consulting s.r.o RM-S FINANCE, Fio investiční
cenných papírů a.s. s.r.o. společnost, a.s.
Interest income 0 0 0 0 0
Interest expense -60 0 0 0 0
Fee and commission income 0 0 0 0 7 500
Fee and commission expense -11 233 -14 352 0 0 0
Profit or loss on financial 0 0 0 0 0
operations
Other operating income 0 0 0 0 0
Administrative expenses 0 0 -1 340 -288 571 0
TOTAL --11 293 -14 352 -1 340 - -288 571 7 500

1 January – 31 December 2020

(CZK ‘000)
RM-SYSTÉM, česká burza Fio forexová s.r.o. Fio RM-S Fio investiční Družstevní
cenných papírů a.s. consulting FINANCE, spolčenost, záložna
s.r.o s.r.o. a.s. PSD
Interest income 0 0 0 0 0 0
Interest expense 0 0 0 0 0 0
Fee and commission income 0 29 514 0 0 3 486 0
Fee and commission expense -12 705 -116 268 0 0 0 0
Profit or loss from financial 0 0 0 0 0 0
operations
Other operating income 0 0 0 0 0 0
Administrative expenses -1 970 0 -648 -305 828 0 0
TOTAL -14 675 -86 754 -648 -305 828 3 486 0

As of 31 December 2021, the aggregate amount of the loans provided by the Company to members
of the Supervisory Board and the Board of Directors was CZK 26,724 thousand (31 December 2020: CZK 20,510
thousand).

Fio banka, a.s. 30

 Notes to the Financial Statements for the Year Ended 31 December 2021

6. Risk Management

6.1. Bank Risks

The Company manages the risks to which it is exposed in its activity, predominantly using the methods as follows:

• Identification of the risks taken;

• Analysis, quantification and regular monitoring of the risks taken;
• Assessment of the degree of risk in executed transactions including the manner of approval;
• Setting the limits in relation to the Company’s exposures towards counterparties;
• Minimisation of the degree of risk in transactions, e.g. by utilising collateral;
• Manners of approving new products; and
• Rigorous separation of risk management from the Company’s business activity.

6.2. Market Risks

These are the risks which the Company is exposed to predominantly as a result of fluctuations of prices, interest
rates and foreign exchange rates of financial instruments on individual markets.

The primary tool for monitoring and managing market risks includes VaR (Value at Risk) and stress testing.
As of 31 December 2021, the highest daily potential loss at the 95% probability level is below 3% of the market value
of the Bank’s trading book which confirms a conservative business strategy. VaR is subject to regular regressive
testing using actual results in order to verify the model validity. Hypothetical as well as historical situations are used
for developing stress scenarios. Set out below are individual risks, including specification of their management.

6.2.1. Currency Risk

Positions in currency instruments result from the structure of the Company’s assets and liabilities. The Company has
foreign currencies in its own positions as it provides its clients with services in foreign currencies and operates
in Slovakia through its foreign branch.

Risk Management determines volume limits for open positions in individual currencies and the VaR limit for the
currency portfolio.

Hedging currency operations are used to meet the set limits.

A confidence level as equal to 99% and the 1D and 1Y intervals of holding are used in calculating risk, while
the maximum anticipated annual loss from foreign exchange rate changes at the 99% probability level should not
exceed CZK 5 million using the VaR methodology. The estimated similarity of the statistical distribution of changes
in market variables with a regular distribution is assumed. The time independence principle is utilised
in recalculations between individual intervals. VaR is calculated by means of the historical method, using historical
periods of the last 100 or 1,000 business days, whichever is higher.

6.2.2. Interest Rate Risk

Interest rate risk is the risk of changes in the value of financial instruments due to changes in market interest rates.
The period for which the interest rate is fixed indicates to what extent the instrument in question is exposed to the
risk of interest rate changes.

The Company maintains a stable structure of interest rate sensitive and insensitive assets and liabilities.
Discrepancies (if any) are managed by way of changes in the manner of applying interest rates to the Company’s
assets and liabilities.

The gap analysis is used to observe the degree of using interest rates which are not determined by the Company and
the degree of the interest rate risk taken whereby interest rate sensitive assets and liabilities are classified into

Fio banka, a.s. 31

 Notes to the Financial Statements for the Year Ended 31 December 2021

several time baskets. Stress scenarios of the impacts of the parallel shift of the yield curve on the present value
of equity and profit/loss within one year are also used. These analyses take place on a quarterly basis.

6.2.3. Proprietary Trading

The Company purchases debt securities of highly creditworthy counterparties for its portfolio. These are usually
government bonds. The degree of risk in those transactions is limited by the set limits and is regularly observed by
Risk Management.

The Bank also trades with shares on markets in the Czech Republic and abroad. The risk level of these positions is
restricted by the volume limits set by Risk Management as well as by the limits and the permissible VaR of these
positions. The limits are set to make sure that any potential losses from these positions cannot significantly affect
the Bank’s profitability. The positions are monitored on a periodic basis and their performance is regularly assessed.

6.3. Liquidity Risk

The Company classifies individual items of assets and liabilities into time-based groups by their residual maturity.
The selected structure of the groups is in line with generally binding legislation and the regulator’s requirements.

The Company seeks to reduce the liquidity risk, particularly by maintaining a sufficient reserve of high liquid assets.

Risk Management regularly analyses the structure of assets and liabilities structure as well as cash flows to identify
any increase in the liquidity risk.

The principal sources of quick liquidity are deposits with the Czech National Bank and government bonds
of the Czech Republic.

6.4. Credit Risk

Credit risk means the risk arising from the counterparty’s failure to meet its contractual obligations under the terms
of a contract.

The Company generally monitors the credit risk for all balance sheet and off-balance sheet positions.

Basic procedures for mitigating risk exposures:

A loan applicant and a debtor are evaluated by assessing several criteria, such as their property situation, income
generated in prior periods, the ability to repay the loan in the future, business plan, purpose of the loan and the
value of the proposed collateral. As regards business loans, financial statements, or, more precisely, tax returns, for
a number of prior years are required. Furthermore, the previous activity in Fio banka, or in other entities of the
Fio Group, is also assessed,

The most liquid global shares traded on global stock exchanges are used to collateralise loans. In other situations,
loans are principally secured by immovable property, guarantees, acceptance of the debtor’s obligation, or the
pledge of the debtor’s receivables from solvent business partners and other types of collateral. The collateral is
usually not required for low-value overdraft loans.

The classification of receivables is based upon an internal policy and applicable legislation defining the rules for the
classification of receivables and provisioning by banks. Reserves and provisions for receivables are created based on
an internal policy which reflects the requirements of IFRS 9.

The Company seeks to use all legal instruments for the collection of receivables such that the costs of collection
were not inadequate to the anticipated outcome.

Fio banka, a.s. 32

 Notes to the Financial Statements for the Year Ended 31 December 2021

The limits of the Company’s exposure are governed by generally binding regulations stipulating the rules for credit
exposure of banks. The Company applies the definition of a group of connected clients under Regulation (EU)
No 575/2013 which also sets the limits of large exposures to a debtor or a group of connected clients at 25%
of eligible capital.

The Company does not use credit derivatives to reduce the credit risk.

The Company enters into relations with counterparties, which include other banks or securities traders, only if they
have been provided with a non-zero credit line by Risk Management. In determining the credit line, Risk
Management observes the rules specified in an internal policy. In particular, Risk Management utilises information
on the share capital and equity of those financial institutions as well as the structure of assets, credit portfolio quality
and collateralisation of receivables. Additionally, the risk management methods, requirements of the counterparty’s
supervisory bodies and rating (if available) are also considered. Limits for deposits are subsequently determined as
part of the counterparty’s equity.

The update of parameters (PD) ECL under IFRS 9 is based on actual historical data and management adjustments. As
of 31 December 2021, the coefficients were updated to reflect the current and prospective risks of individual loan
products.

6.4.1. Concentration Risk

In the loan portfolio, the Company additionally monitors possible concentration risks, while monitoring whether
individual NACE sectors do not exceed the allowed limit per sector which was CZK 8.5 billion at the end of the year.
Except for the exposure to entities in the T group which includes primarily households (which are exempt from the
limit on concentrations), no limit for any sector was breached.

Exposure of the
TOP 5 sectors with the highest sector concentration sector (CZK billion)
T – Activities of households 16.1
L – Real estate activities 7.3
S – Other services activities 5.5
G – Wholesale and retail trade; repair of motor vehicles and motorcycles 1.7
C – Manufacturing 1.5

6.5. Operational Risks

The Company defines operational risk as the risk of loss resulting from the inadequacy or the failure of internal
processes, persons, systems or external factors.

Basic procedures for reducing risk

The risk of human factor failure is reduced particularly by the appropriate training of the relevant persons as well as
by consistent controls.

The risk of loss or theft of cash on hand is managed by appropriate storage facilities (safe, bank safe, safety box,
etc.), insurance, by setting the limits for the amount of cash as well as by inspecting compliance of the actual amount
of cash with the recorded figures.

Record-keeping and the notification obligation as regards operational risk events are provided for in the specific
internal policy of the Company.

There is a special internal regulation for specifying risks, procedures and measures for the reduction of risks resulting
from the use of information systems.

Fio banka, a.s. 33

 Notes to the Financial Statements for the Year Ended 31 December 2021

A specific internal policy of the Company regulates the procedures and processes for the minimisation of risks arising
from the launch of new products and services.

The Company currently determines the degree of capital requirements for operational risks by applying the basic
indicator in accordance with applicable legal regulations and, concurrently, monitors operational risk events,
creating a database of these events to be able to evaluate them by own statistic models.

The Company has developed plans for business continuity in the event of an unexpected suspension or limitation
of its activities, such as due to a failure of external infrastructure. These plans are tested and updated on a regular
basis.

Fio banka, a.s. 34

 Notes to the Financial Statements for the Year Ended 31 December 2021

7. RESIDUAL MATURITY OF ASSETS AND LIABILITIES

31 December 2021
(CZK ‘000)
Repayable on Within From From 1 year More than Not defined Total
demand within 3 months 3 months to to 5 years 5 years
7 days 1 year
Cash in hand and balances with 50 253 982 4 800 000 0 0 0 0 55 053 982
central banks
State zero-coupon bonds 0 0 0 0 0 0
Loans and receivables to banks 1 687 469 0 127 635 0 0 473 750 2 288 854
and cooperative credit unions
Loans and receivables to 1 094 789 3 453 593 14 289 051 786 469 17 829 715 0 37 453 617
customers
Debt securities 0 460 335 8 811 906 60 150 951 48 436 427 18 230 117 877 849
Shares, share certificates and 0 0 0 0 0 203 748 203 748
other equity investments
Investments in subsidiaries 0 0 0 0 0 71 608 71 608
Tangible and intangible fixed 0 0 0 0 0 358 250 358 250
assets
Other assets 957 006 6 198 309 100 11 104 0 2 1 283 410
Prepayments and accrued income 42 375 29 671 14 179 7 423 0 0 93 648
TOTAL ASSETS 54 035 621 8 749 797 23 551 871 60 955 947 66 266 142 1 125 588 214 684 966
Due to banks and cooperative 139 164 45 0 0 0 0 139 209
credit unions
Due to customers 201 108 875 1 180 767 755 038 351 990 203 396 670
Liabilities from debt securities 0 0 1 388 0 587 330 0 588 718
Other liabilities 1 011 563 108 029 46 452 0 0 293 706 1 459 750
Reserves 0 0 502 217 0 0 2 469 504 686
Subordinated liabilities 0 0 0 0 90 000 0 90 000
Equity 0 0 0 0 0 7 940 071 7 940 071
Non-derivative liabilities 202 259 602 1 288 841 1 305 095 351 990 677 330 8 236 246 212 659 354
Derivative liabilities 565 862 0 0 0 0 0 565 862
TOTAL LIABILITIES 202 825 464 1 288 841 1 305 095 351 990 677 330 8 236 246 214 684 966
Net liquidity risk -148 789 843 7 460 956 22 246 776 60 603 957 65 588 812 - 7 110 658 0
Cumulative liquidity risk -148 789 843 -141 328 887 -119 082 111 - 58 478 154 7 110 658 - 0

31 December 2020
(CZK ‘000)
Repayable on Within 3 From 3 From 1 year More than Not defined Total
demand within 7 months months to 1 to 5 years 5 years
days year
Cash in hand and balances with 81 086 816 0 0 0 0 0 81 086 816
central banks
State zero-coupon bonds 0 2 571 771 0 0 0 0 2 571 771
Loans and receivables to banks 1 470 744 0 140 502 0 0 303 820 1 915 066
and cooperative credit unions
Loans and receivables to 769 733 1 547 204 11 672 960 496 397 11 658 699 0 26 144 993
customers
Debt securities 0 0 2 620 532 52 118 503 13 842 673 0 68 581 708
Shares, share certificates and 0 0 0 0 0 181 045 181 045
other equity investments
Investments in subsidiaries 0 0 102 362 0 0 61 427 163 789
Tangible and intangible fixed 0 0 0 0 0 502 296 502 296
assets
Other assets 973 443 41 191 319 211 9 768 0 71 1 343 684
Receivables from subscribed 0 0 0 0 0 0 0
capital
Prepayments and accrued income 0 46 055 0 0 0 0 46 055
TOTAL ASSETS 84 300 736 4 206 221 14 855 567 52 624 668 25 501 372 1 048 659 182 537 223
Due to banks and cooperative 224 458 0 0 0 0 0 224 458
credit unions
Due to customers 172 321 458 1 298 001 894 084 346 649 0 174 860 192
Other liabilities 909 936 115 127 100 357 345 226 0 0 1 470 646
Reserves 0 0 286 764 0 0 3 386 290 150
Subordinated liabilities 0 0 0 0 90 000 0 90 000
Equity 0 0 0 0 0 5 601 777 5 601 777
TOTAL LIABILITIES 173 455 852 1 413 128 1 281 205 691 875 90 000 5 605 163 182 537 223
Net liquidity risk -89 155 116 2 793 093 13 574 362 51 932 793 25 411 372 -4 556 504 0
Cumulative liquidity risk -89 155 116 -86 362 023 -72 787 661 -20 854 868 4 556 504 0 0

Fio banka, a.s. 35

 Notes to the Financial Statements for the Year Ended 31 December 2021

8. ASSETS AND LIABILITIES BY CURRENCY

31 December 2021
(CZK ‘000)
CZK EUR USD Other Total
Cash in hand and balances with central banks 53 758 620 1 251 350 43 983 29 55 053 982
State zero-coupon bonds 0 0 0 0 0
Loans and receivables to banks and cooperative credit unions 828 879 329 834 463 310 666 831 2 288 854
Loans and receivables to customers 29 162 969 7 869 134 332 999 88 515 37 453 617
Debt securities 114 499 350 3 360 269 18 230 0 117 877 849
Shares, share certificates and other equity investments 159 577 7 182 36 989 0 203 748
Investments in subsidiaries 71 608 0 0 0 71 608
Tangible and intangible fixed assets 358 250 0 0 0 358 250
Other assets 449 260 48 161 783 354 2 635 1 283 410
Prepayments and accrued income 60 144 32 981 523 0 93 648
TOTAL ASSETS 199 348 657 12 898 911 1 679 388 758 010 214 684 966
Due to banks and cooperative credit unions 103 333 25 578 10 298 0 139 209
Due to customers 161 311 043 36 433 236 4 709 539 942 852 203 396 670
Liabilities from debt securities 588 718 0 0 0 588 718
Other liabilities 1 705 745 310 267 6 227 3 373 2 025 612
Reserves 504 686 0 0 0 504 686
Subordinated liabilities 90 000 0 0 0 90 000
Equity 7 940 071 0 0 0 7 940 071
TOTAL LIABILITIES 172 243 596 36 769 081 4 726 064 946 225 214 684 966
Net currency risk 27 105 061 -23 870 170 -3 046 676 -188 215 0
Cumulative currency risk 27 105 061 3 234 891 188 215 0 0

31 December 2020
(CZK ‘000)
CZK EUR USD Other Total
Cash in hand and balances with central banks 80 896 842 153 169 36 776 29 81 086 816
State zero-coupon bonds 997 071 1 574 700 0 0 2 571 771
Loans and receivables to banks and cooperative credit unions 554 323 528 408 261 467 570 868 1 915 066
Loans and receivables to customers 20 129 295 5 710 200 218 304 87 194 26 144 993
Debt securities 65 022 448 3 559 260 0 0 68 581 708
Shares, share certificates and other equity investments 131 839 5 068 44 138 0 181 045
Investments in subsidiaries 163 789 0 0 0 163 789
Tangible and intangible fixed assets 502 296 0 0 0 502 296
Other assets 487 686 75 366 773 590 7 042 1 343 684
Receivables from subscribed capital 0 0 0 0 0
Prepayments and accrued income 15 157 30 663 235 0 46 055
TOTAL ASSETS 168 900 746 11 636 834 1 334 510 665 133 182 537 223
Due to banks and cooperative credit unions 186 334 25 318 12 806 0 224 458
Due to customers 140 819 290 28 425 330 4 858 606 756 966 174 860 192
Other liabilities 1 182 329 276 582 9 299 2 436 1 470 646
Reserves 290 150 0 0 0 290 150
Subordinated liabilities 90 000 0 0 0 90 000
Equity 5 601 777 0 0 0 5 601 777
TOTAL LIABILITIES 148 169 880 28 727 230 4 880 711 759 402 182 537 223
Net currency risk 20 730 866 -17 090 396 -3 546 201 -94 269 0
Cumulative currency risk 20 730 866 3 640 470 94 269 0 0

Fio banka, a.s. 36

 Notes to the Financial Statements for the Year Ended 31 December 2021

9. INTEREST RATE ANALYSIS

31 December 2021
(CZK ‘000)
Within From From 1 to More than Not defined Total
3 months 3 months to 5 years 5 years
1 year
Cash in hand and balances with central banks 50 253 982 4 800 000 0 0 0 55 053 982
State zero-coupon bonds 0 0 0 0 0 0
Loans and receivables to banks and cooperative credit 1 687 469 127 635 0 0 473 750 2 288 854
unions
Loans and receivables to customers 3 732 787 16 867 831 16 261 221 591 778 0 37 453 617
Debt securities 0 41 599 301 53 433 537 22 826 781 18 230 117 877 849
Shares, share certificates and other equity investments 0 0 0 0 203 748 203 748
Investments in subsidiaries 0 0 0 0 71 608 71 608
Tangible and intangible fixed assets 0 0 0 0 358 250 358 250
Other assets 963 204 309 100 11 104 0 2 1 283 410
Prepayments and accrued income 72 046 14 179 7 423 0 0 93 648
TOTAL ASSETS 56 709 488 63 718 046 69 713 285 23 418 559 1 125 588 214 684 966
Due to banks and cooperative credit unions 139 209 0 0 0 0 139 209
Due to customers 202 289 642 755 038 351 990 0 0 203 396 670
Liabilities from debt securities 0 0 0 588 718 0 588 718
Other assets 1 685 454 46 452 0 0 293 706 2 025 612
Reserves 0 502 217 0 0 2 469 504 686
Subordinated liabilities 0 0 0 90 000 0 90 000
Equity 0 0 0 0 7 940 071 7 940 071
TOTAL LIABILITIES 204 114 305 1 303 707 351 990 678 718 8 236 246 214 684 966
Net interest rate risk -147 404 817 62 414 339 69 361 295 22 739 841 -7 110 658 0
Cumulative interest rate risk -147 404 817 -84 990 478 -15 629 183 7 110 658 0 0

31 December 2020
(CZK ‘000)
Within From From 1 to More than Not defined Total
3 months 3 months to 5 years 5 years
1 year
Cash in hand and balances with central banks 81 086 816 0 0 0 0 81 086 816
State zero-coupon bonds 2 571 771 0 0 0 0 2 571 771
Loans and receivables to banks and cooperative credit 1 470 744 140 502 0 0 303 820 1 915 066
unions
Loans and receivables to customers 4 465 315 10 634 446 10 134 971 910 261 0 26 144 993
Debt securities 0 14 850 306 44 895 166 8 836 236 0 68 581 708
Shares, share certificates and other equity investments 0 0 0 0 181 045 181 045
Investments in subsidiaries 0 0 0 0 163 789 163 789
Tangible and intangible fixed assets 0 0 0 0 502 296 502 296
Other assets 1 014 634 319 211 9 768 0 71 1 343 684
Receivables from subscribed capital 0 0 0 0 0 0
Prepayments and accrued income 46 055 0 0 0 0 46 055
TOTAL ASSETS 90 655 335 25 944 465 55 039 905 9 746 497 1 151 021 182 537 223
Due to banks and cooperative credit unions 224 458 0 0 0 0 224 458
Due to customers 173 619 459 894 084 346 649 0 0 174 860 192
Other liabilities 1 025 063 100 357 345 226 0 0 1 470 646
Reserves 0 286 764 0 0 3 386 290 150
Subordinated liabilities 0 0 0 90 000 0 90 000
Equity 0 0 0 0 5 601 777 5 601 777
TOTAL LIABILITIES 174 868 980 1 281 205 691 875 90 000 5 605 163 182 537 223
Net interest rate risk -84 213 645 24 663 260 54 348 030 9 656 497 -4 454 142 0
Cumulative interest rate risk -84 213 645 -59 550 385 -5 202 355 4 454 142 0 0

Fio banka, a.s. 37

 Notes to the Financial Statements for the Year Ended 31 December 2021

10. POST BALANCE SHEET EVENTS

The ongoing military conflict in Ukraine and relating sanctions against the Russian Federation may have an impact
on the European and global economy. The Company does not have any significant direct exposure to Ukraine, Russia
and Belarus. However, the impact on the general economic situation may require revisions of certain assumptions
and estimates. This may lead to material adjustments to the carrying value of certain assets and liabilities within the
next financial year. At this stage, management is not able to reliably estimate the impact as events are unfolding day
by day. A long-term impact may also affect trading volumes, cash flows and profitability.

In terms of credit risks, the Company analysed the credit portfolio and identified entities whose ability to pay their
liabilities may by significantly reduced due to the geopolitical situation, increasing prices of commodities and fuels
and lack of manpower. For such loans, the Company recognised additional provisions on an individual basis and also
monitors these entities on a continuous basis.

Given the run on Sberbank CZ and the uncertainty of depositors, the Czech National Bank introduced a daily
reporting on liquidity situation. Given its focus on the local retail clientele, the Company has not seen any negative
trends in its liquidity that would not relate to the natural fluctuation, e.g. as a result of the interest rate policy of the
central bank.

In terms of the operational risk, the Company focused primarily on cyber security and functioning of supplier chains.
The Company regularly monitors warnings of external agencies, the National Cyber and Information Security Agency
and the Czech National Bank regarding potential security risks relating to the geopolitical situation and improves its
internal processes and security on a continuous basis.

The Company additionally recorded an increase in foreign exchange transactions and cross-border payments.
Following the disconnection of Russia from the SWIFT system and limitations imposed on foreign trade and RUB
convertibility, the Company had to adopt some operational restrictions and informed its clients about them
in a timely manner. The funds in RUB were reduced to a necessary operational level already at the beginning of the
conflict and the allowable limit on the foreign exchange position in RUB currency was significantly reduced.

As to its standard operations, the Company operates in the normal mode despite the situation, it only puts more
emphasis on the flow of information and communication with clients, primarily regarding changes in payment
transaction services (payments in RUB, cross-border payments, etc.), changes in price lists (remission of fees for
payments to Ukraine) and increasing security risks (phishing).

Except for the above events no other events occurred subsequent to the balance sheet date.

Fio banka, a.s. 38

IV
Information on Capital

Information on Capital
Information on Capital, Capital Requirements and Ratio Indicators
(Information published under Section 102 (1) of Decree No. 163/2014 Coll.)

In 2014, new legal regulations came into force providing for capital adequacy by launching the Basel III
requirements, namely Capital Requirements Regulation (EU) No 575/2013 (CRR) and Decree
No. 163/2014 Coll. of the Czech National Bank. Nevertheless, the changes arising for the Company due
to the new regulations are rather insignificant.

Information on capital requirements on an individual basis as of 31 December 2021

(CZK ‘000)

Common Equity Tier 1 capital: instruments and reserves

1 Capital instruments and related share premium = Paid share capital 760 000.00
2 Retained earnings 6 645 699.37
6 Common Equity Tier 1 capital before normative adjustments 7 405 699.37
Common Equity Tier 1 capital: normative adjustments
8 Intangible assets (net of related tax liabilities) (negative value) -3 419.13
28 Total normative adjustments to Common Equity Tier 1 capital -4 421.34
29 Common Equity Tier 1 7 401 278.04
44 Additional Tier 1 capital 0.000
45 Tier 1 capital = Common Equity Tier 1 capital + Additional Tier 1 capital 7 401 278.04
Tier 2 capital: instruments and items
46 Capital instruments and related share premium 0.000
57 Total normative adjustments to Tier 2 capital 0.000
58 Tier 2 capital 90 000.000
59 Total capital = Tier 1 capital + Tier 2 capital 7 491 278.04

Information on Capital
Information on capital requirements on an individual basis as of 31 December 2021
(CZK ‘000)

The Company applies the standardised approach to calculating the capital requirements for credit risk.

Exposures to central governments or central banks 0.000

Exposures to regional governments or local authorities 0.000
Exposures to public sector entities 0.000
Exposures to international development banks 0.000
Exposures to international organisations 0.000
Credit risk
Exposures to institutions 55 527.763
– 8% of the
volume of Exposures to companies 1 040 416.04
risk- Retail exposures 283 453.805
weighted
exposures Exposures secured by property 294 227.784
for each Exposures in default 170 732.288
category of
exposures Exposures related with extremely high risk 285 103.690
listed in Exposures in secured bonds 0.000
Article 112
Items representing securitised positions 0.000
Exposures to institutions and businesses with short-term credit rating 0.000
Exposure in the form of share units or shares in collective investment entities 0.000
Share exposure 7 951.430
Other items 29 655.403

Capital Regarding the position risk 37 591.811

requirement These limits may be exceeded for large exposures listed in Articles 395
0.000
calculated through 401 if institutions are permitted to do so.
under Regarding currency risk 0.000
Section 92
(3) b) and Regarding settlement risk 0.000
c) Regarding commodity risk 0.000
Under Title III Chapter 2 – regarding operating risk, by way of the basic indicators 440 920.000
TOTAL 2 650 927.794

Capital ratios as of 31 December 2021 (as a percentage share of the risk exposure)

61 Common Equity Tier 1 capital 22.34%

62 Tier 1 capital 22.34%
63 Total capital 22.61%

Information on Capital
Ratio indicators

As of 31 December 2021
Return on average assets (ROAA) 1.13%
Return on assets (ROA) 1.09%
Return on average equity (ROAE) 31.59%
Assets per employee (CZK ‘000) 2 190 663
Administrative costs per employee (CZK ‘000) 9 815
Profit or loss after tax per employee (CZK ‘000) 23 857

The information on the Company that has to be published is available at: http://www.fio.cz/o-nas/fio-
banka

Information on Capital
V
Report on Relations

Report on Relations
Report on Relations between the Controlling Entity and the Controlled Entity and between
the Controlled Entity and Other Entities Controlled by the Same Controlling Entity (hereinafter
the “Report on Relations”) prepared pursuant to Section 82 et seq. of Act No. 90/2012 Coll., on Business
Corporations, of Fio banka, a.s., Corporate ID: 61858374, with its registered office at Prague 1,
V Celnici 1028/10, postal code 11721, recorded in the Register of Companies held by the Municipal Court in
Prague, File No. B 2704, for the reporting period from 1 January 2021 to 31 December 2021.

I. Structure of Relations

1. Controlled Entity
Fio banka, a.s.
Corporate ID: 61858374
Praha 1, V Celnici 1028/10, postal code 11721
recorded in the Register of Companies held by the Municipal Court in Prague, File No. B 2704,
represented by the Chairman of the Board of Directors, Jan Sochor, and a member of the Board
of Directors, Josef Valter,

(hereinafter the “Bank” or the “Controlled Entity”)

2. Controlling Entity
Fio holding, a.s.
Corporate ID: 60192763
with its registered office at: 117 21 Prague 1, V Celnici 1028/10
recorded in the Register of Companies held by the Municipal Court in Prague, File No. B 2270

The company’s shareholders are Petr Marsa and Romuald Kopún, acting in concert, who represent
the Controlling Entity, thus indirectly controlling the Controlled Entity.

(hereinafter also the “Controlling Persons”)

3. Entities Controlled by the Same Controlling Persons, Petr Marsa and Romuald Kopún

- AASRK, a.s., Corporate ID: 28205367, Praha 1, V Celnici 1028/10, postal code 110 00;
- AGROPRODUKT-odbytové družstvo, Corporate ID: 43903797, Madunice, Kostolanská 2/540,
postal code 922 42, Slovak Republic;
- APMAS, a.s., Corporate ID: 28206436, Praha 1, V Celnici 1028/10, postal code 117 21;
- BASRK, a.s., Corporate ID: 28204107, Praha 1, V Celnici 1028/10, postal code 117 21;
- BPMAS, a.s., Corporate ID: 28212703, Praha 1, V Celnici 1028/10, postal code 117 21;
- CASRK, a.s., Corporate ID: 28207483, Praha 1, V Celnici 1028/10, postal code 117 21;
- CFT, a.s., Corporate ID: 61859079, Praha 1, V Celnici 1028/10, postal code 117 21;
- CPMAS, a.s., Corporate ID: 28211138, Praha 1, V Celnici 1028/10, postal code 110 00;
- DASRK, a.s., Corporate ID: 282 12 711, Praha 1, V Celnici 1028/10, postal code 117 21;
- Družstevní záložna Kredit, Corporate ID: 64946649, Praha 1, V Celnici 1028/10, postal code
117 21;
- DZ KREDIT a.s., Corporate ID: 25623184, Praha 1, V Celnici 1028/10, postal code 117 21;
- EASRK, a.s., Corporate ID: 28206576, Praha 1, V Celnici 1028/10, postal code 117 21;
- ELLIAD a.s., Corporate ID: 25623192, Praha 1, V Celnici 1028/10, postal code 117 21;
- EPMAS, a.s., Corporate ID: 28206517, Praha 1, V Celnici 1028/10, postal code 117 21;
- Finanční skupina Fio, a.s., Corporate ID: 26761858, Praha 1, V Celnici 1028/10, postal code
117 21;
- Fio Consulting, spol. s.r.o., Corporate ID: 25740334, Praha 1, V Celnici 1028/10, postal code 117
21;
- Fio holding, a.s., Corporate ID: 60192763, Praha 1, V Celnici 1028/10, postal code 117 21;
- Fio investiční společnost, a.s., Corporate ID: 06704441, Praha 1, V Celnici 1028/10, postal code
110 00;
- Fio leasing, a.s., Corporate ID: 61860841, Praha 1, V Celnici 1028/10, postal code 117 21;
- Fio Polska spółka z o.o, Corporate ID: 140192608, Szpitalna 1/17, 00-020 Warszawa, Poland;
Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Praha 1, CR, recorded in the Register of Companies held by the
Municipal Court in Prague, File No. B 2704, tel.: +420 224 346 111, fax: +420 224 346 110, http://www.fio.cz
 - Fio realitní fond SICAV, a.s., Corporate ID: 14052628, Praha 1, V Celnici 1028/10, postal code
117 21,
- Fio Slovakia, a.s., Corporate ID: 35828137, Nám. SNP 21, Bratislava 811 01;
- FPMAS, a.s., Corporate ID: 282 11 502, Praha 1, V Celnici 1028/10, postal code 117 21;
- FPSROG, spol. s r.o., Corporate ID: 25718843, Praha 1, V Celnici 1028/10, postal code 117 21;
- FPSROH, spol. s r.o., Corporate ID: 25738755, Praha 1, V Celnici 1028/10, postal code 117 21;
- GENT CZ spol. s r.o., Corporate ID: 48593753, Praha 1, V Celnici 1028/10, postal code 117 21;
- KOFIMA, s. r.o., Corporate ID: 25269241, Praha 9, Kolmá 5/597, postal code 190 00;
- Midleton a.s., Corporate ID: 35942177, Nám. SNP 21, Bratislava 811 01, Slovak Republic;
- Fio forexová, s.r.o., Corporate ID: 27589587, Praha 1, V Celnici 1028/10, postal code 117 21;
- NOBLIGE a.s., Corporate ID: 26145090, Praha 1, V Celnici 1028/10, postal code 117 21;
- NYDELS s.r.o., Corporate ID: 64581331, Praha 9, Kolmá 5/597, postal code 190 00;
- OVOAGRI s.r.o., Corporate ID: 36463388, Madunice, Kostolanská 2/540, postal code 922 42,
Slovak Republic;
- OVOFARM s.r.o., Corporate ID: 36015067, Madunice, Kostolanská 2/540, postal code 922 42,
Slovak Republic;
- RM-S FINANCE, s.r.o., Corporate ID: 62915240, Praha 1, V Celnici 1028/10, postal code 117 21;
- RM-SYSTÉM, česká burza cenných papírů a.s., Corporate ID: 471 16 404, Praha 1 - Nové Město,
V Celnici 1028/10, postal code 117 21;
- T.O.R.S. s.r.o., Corporate ID: 49682024, Praha 1, V Celnici 1028/10, postal code 110 00;
- VARIEL, a.s., Corporate ID: 45148287, Zruč nad Sázavou, Průmyslová 1034, postal code 285 22;
- VVISS a.s., Corporate ID: 48585131, Praha 9, Kolmá 5/597, postal code 190 00;
- VVISS delta, s.r.o., Corporate ID: 36015105, Madunice, Kostolanská 2/540, postal code 922 42,
Slovak Republic;
- VVISS Lipence, s.r.o., v likvidaci, Corporate ID: 64581314, Praha 9, Kolmá 5/597, postal code 190
00;
- VVISS Terezín, s.r.o., v likvidaci, Corporate ID: 25125931, Praha 9, Kolmá 5/597, postal code 190
00.

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Praha 1, CR, recorded in the Register of Companies held by the
Municipal Court in Prague, File No. B 2704, tel.: +420 224 346 111, fax: +420 224 346 110, http://www.fio.cz
4. Graphics Depicting the Structure of Relations between Entities Controlled by Petr Marsa and Romuald Kopún

RNDr. Petr Marsa MBA Fio holding, a.s. Mgr. Romuald

(acting in concert, each shareholder 50%) VVISS Terezín, s.r.o.
LL.M. Kopún v likvidaci, 100%

Fio banka, a.s. Finanční skupina Fio, a.s. CPMAS, a.s., 100%
100% 100%

RM-SYSTÉM, česká burza Fio investiční

FPSROG, spol. s r.o., 100% cenných papírů a.s., 100% společnost, EPMAS, a.s., 100%
a.s., 100%

RM-S FINANCE, s.r.o. Fio forexová, s.r.o. Fio Consulting, VVISS delta, s.r.o., FPMAS, a.s., 100%
100% 100% spol. s r.o.,100% 46.45%
Midleton a.s., 50% Midleton a.s., 50%
Fio realitní fond SICAV,
Fio leasing, a.s.
a.s., 100%
100%
NOBLIGE a.s., 100% FPSROH, spol. s r.o., 100%
BPMAS, a.s., 100%
Fio Slovakia a.s.
100%
Fio Polska spółka z o.o,100% APMAS, a.s., 100%

VVISS a.s., 100%

ELLIAD a.s., 100% BASRK, a.s., 100% AGROPRODUKT - odbytové
družstvo, každá s.r.o. 25%
VVISS Lipence, s.r.o.
DASRK, a.s., 100% AASRK, a.s., 100% v likvidaci, 100%
OVOFARM
s.r.o., 100%
DZ KREDIT a.s., 100% EASRK, a.s., 100%

OVOAGRI
CASRK, a.s., 100% T.O.R.S. s.r.o., 100% s.r.o. 100%

VARIEL, a.s., 94.95%

CFT a.s., 100%

Družstevní záložna Kredit

100% GENT CZ spol. s.r.o. NYDELS s.r.o., 100% KOFIMA, s. r.o., 100%
100%

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of Companies held by the Municipal Court in Prague, File No. B 2704. Tel.:
+420 224 346 111, Telefax: +420 224 346 110, http://www.fio.cz
II. Role of the Controlled Entity

The Controlled Entity, as a provider of payment and banking services, enters into business relationships
with entities within the group of controlled entities, predominantly with RM-S Finance, s.r.o., which is
a tied agent of the Bank (similarly, in Slovakia, the Controlled Entity enters into business relationships
with Fio Slovakia a.s., by means of its organisational branch Fio banka, a.s., pobočka zahraničnej banky)
and further with RM-SYSTÉM, česká burza cenných papírů a.s. and Fio investiční společnost, a.s. with
which the Bank cooperates in the field of provision of banking services and trading with securities.
Other entities within the group of controlled entities are principally provided with standard banking
services as well as services the Bank is authorised to provide as a securities trader.

III. Manner and Means of Control

1. The Bank is directly controlled by Fio holding, a.s., which holds 100% of the Bank’s shares.
2. The Bank is indirectly controlled by the sole shareholders of Fio holding, a.s., Messrs Petr Marsa
and Romuald Kopún, acting in concert, who thus indirectly control the Controlled Entity and
represent the Controlling Persons.

IV. Contracts and Agreements Concluded in the Year Ended 31 December 2021 and Contracts
and Agreements Still Effective in the Year Ended 31 December 2021

1. Contracts and agreements concluded between the Controlling Persons and the
Controlled Entity

a) Contracts concluded prior to 1 January 2021 still effective as of 31 December 2021

Romuald Kopún
Bank account agreements
Agency contract and other arrangements

Petr Marsa
Bank account agreements
Framework agreement on the provision of payment services
Framework agreement on financial market trading

Fio holding, a.s.

Shares subscription agreement
Account maintenance agreements
Agency contract and other arrangements

b) Contracts concluded in the year ended 31 December 2021

Romuald Kopún
No new agreements were concluded in 2021.

Petr Marsa
Framework agreement on investment

2. Contracts and agreements concluded between the Controlled Entity and entities
controlled by the same Controlling Persons

a) Contracts concluded prior to 1 January 2021 still effective as of 31 December 2021

AASRK, a.s.
Account maintenance agreement

AGROPRODUKT - odbytové družstvo

Account maintenance agreement

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz
 APMAS, a.s.
Account maintenance agreement

BASRK, a.s.
Account maintenance agreement

BPMAS, a.s.
Account maintenance agreement

CASRK, a,s,
Account maintenance agreement
Master agreement on investment

CFT a.s.
Account maintenance agreement
Framework agreement on financial market trading
Framework agreement on the provision of payment services*

CPMAS, a.s.
Account maintenance agreement

DASRK, a.s.
Account maintenance agreement

Družstevní záložna Kredit

Account maintenance agreement
Agency contract
Outsourcing contract
Framework agreement on financial market trading
Personal data processing agreement
Framework agreement on the provision of payment services*

DZ KREDIT a.s.
Account maintenance agreement
Agency contract and other arrangements
Framework agreement on financial market trading
Framework agreement on the provision of payment services*

EASRK, a.s.
Account maintenance agreement

ELLIAD a.s.
Account maintenance agreement
Agency contract and other arrangements
Framework agreement on financial market trading
Framework agreement on the provision of payment services*

EPMAS, a.s.
Account maintenance agreement
Agreement on loan no. 2010-1-4503819

Finanční skupina Fio, a.s.

Account maintenance agreement
Contract on the transfer of a business interest

Fio Consulting, spol. s.r.o.

Account maintenance agreements
Bookkeeping agreement
Personal data processing agreement

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz
 Fio forexová, s.r.o.
Account maintenance agreement
Loan agreement No. 151000061

Fio investiční společnost, a.s.

Account maintenance agreements
Master agreement on investment
Framework agreement on financial market trading
Outsourcing contract
Contract on offering investments to the fund
Personal data processing agreement
Framework agreement on the provision of payment services*

Fio leasing, a.s.

Sub-lease agreement

FIO POLSKA SP Z O O
Account maintenance agreements

Fio Slovakia, a.s.

Account maintenance agreements
Contract on the definition of rights and obligations following from the membership in a VAT
group registration
Contract of mandate
Framework agreement on the provision of payment services*

FPMAS, a.s.
Account maintenance agreement

FPSROH spol. s r.o.

Account maintenance agreement

FPSROG spol. s r.o.

Account maintenance agreement

GENT CZ spol. s r.o.

Agency contract and other arrangements

KOFIMA, s.r.o.
Account maintenance agreement

Midleton a.s.
Account maintenance agreements

NOBLIGE a.s.
Account maintenance agreements
Framework agreement on financial market trading

NYDELS, s.r.o.
Account maintenance agreements

Odbytové družstvo ovoce Český ráj

Account maintenance agreements

OVOAGRI s.r.o.
Account maintenance agreements

OVOFARM s.r.o.
Account maintenance agreement

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz
 RMS-Finance s.r.o.
Agency agreement
Contract on the definition of rights and obligations following from membership in a VAT
group registration
Contract on the administration and development of an IT system and other ICT equipment
Account maintenance agreements
Outsourcing contract
Personal data processing agreement

RM-SYSTÉM, česká burza cenných papírů a.s. (hereinafter also “Česká burza”)
Contract on a special validation method
Mutual cooperation agreement on the validation of the technical and programme service
solution
Sublease agreement
Contract on the definition of rights and obligations following from the membership in a VAT
group registration
Account maintenance agreements
Internal audit services agreement
Compliance services agreement
Contract on the representation of Česká burza with the registration of clients
Contract on the internalisation of settlement
Contract on access to the market of Česká burza
Contract on the report of transactions

T.O.R.S. s.r.o.
Account maintenance agreement
Framework agreement on financial market trading
Framework agreement on the provision of payment services*

VARIEL, a.s.
Account maintenance agreement
Loan agreement No. 141000078
Loan agreement No. 151000002
Loan agreement No. 171000065
Loan agreement No. 171000066
Loan agreement No. 181000083
Master agreement on investment

VVISS, a.s.:
Account maintenance agreements
Master agreement on investment
Contract on the definition of rights and obligations following from membership in a VAT
group registration
Loan agreement No. 151000039
Contract on the provision of a borrowing
Contract on the provision of a guarantee No. 163000008
Contract on the provision of a guarantee No. 173000029
Loan agreement No. 191000027
Contract on the provision of a guarantee No. 193000015
Framework agreement on financial market trading

* originally included in account maintenance agreements

b) Contracts concluded in the year ended 31 December 2021

CPMAS, a.s.
Loan agreement No. 2010-1-4603890

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz
 Fio realitní fond SICAV, a.s.
Agreement on an account for the share capital deposit

GENT CZ spol. s r.o.

Framework agreement on the provision of payment services

RM-SYSTÉM, česká burza cenných papírů a.s.

Agreement on the performance of market maker activities

VVISS, a.s.
Loan agreement No. 210404886035
Loan agreement No. 2012-1-4592317

In some cases, other contracts on the provision of standard banking services were concluded in
relation to the account maintenance agreements (eg agreements on the issuance of bank cards,
activation of internet banking etc). Also, amendments to some of the aforementioned contracts and
agreements were concluded.

V. List of the Acts Made in the Latest Reporting Period at the Instigation or in the Interest of
the Controlling Entity or Entities Controlled by the Controlling Entity with Respect to Assets
Exceeding 10% of Equity identified in the Financial Statements for the Year Ended
31 December 2021

- In 2020, Fio forexová, s.r.o. drew a loan provided by Fio banka, a.s. (based on the
aforementioned Loan Agreement No. 151000061) of up to CZK 21 billion.

VI. Assessment of Detriment Incurred by the Controlled Entity and the Settlement thereof
pursuant to Sections 71 and 72 of Act No. 90/2012 Coll.

The Bank as the Controlled Entity did not incur any detriment. All transactions made between the
Controlling Entity and the Controlled Entity and between the Controlled Entity and entities controlled
by the same Controlling Entity were made pursuant to the applicable legal regulations.

VII. Assessment of Advantages and Disadvantages Arising from Control

Within the group of controlled entities, as far as the Bank is concerned, advantages of being
a controlled entity prevail, the main reason being the fact that, the Bank is ultimately controlled by
two natural persons acting in concert, which provides the Bank with stability in decision-making
processes.

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz
 In 2021, controlled entities cooperated predominantly in foreign currency trading and in mediation
of bank services, both the payment and investment ones. The controlled entities are not
in competition in terms of the services provided and, therefore, such a situation has no negative
impact on their market position and the Bank, and its management have sufficient space to
maximally exploit the market potential in the respective area of business.

In Prague on 31 March 2022

I
I

I
Jan; cho
Char '.ma}1 of the Board of Dire ors
Fio Ka, a.s.
''

Fio banka, a.s., Corporate ID: 61858374, V Celnici 1028/10, 117 21 Prague 1, Czech Republic, recorded in the Register of
Companies held by the Municipal Court in Prague, File No. B 2704. Tel.: +420 224 346 111, Telefax: +420 224 346 110,
http://www.fio.cz