On 3 October 2016 PZU Supervisory Board adopted a resolution (Current Report 61/2016 of 4 October 2016) to approve the PZU Group’s Capital and Dividend Policy for 2016- 2020 (“Policy”).
The introduction of the Policy followed from implementation, as of 1 January 2016, of Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of insurance and reinsurance (“Solvency II”), as amended, the Insurance and Reinsurance Activity Act of 11 September 2015 and the expiration of the PZU Group’s Capital and Dividend Policy for 2013-2015 updated in May 2014.
In accordance with the Policy, the PZU Group endeavors to do the following:
The capital management policy rests on the following principles:
The PZU and PZU Group’s dividend policy rests on the following principles:
with a reservation that:
PZU Group’s Dividend and Capital Policy
PZU’s earnings and dividend per share in 2010 - 2017
Dividend distributions and total shareholder return (TSR) of PZU (2010 - 2017)
Book value per share and gross accumulated dividend per share in PZU (PLN) (2010 - 2017)
* in 2013 a dividend was paid from excess capital (PLN 2 per share)
Payment of a dividend from the profits generated in 2016
On 29 June 2017, PZU’s Ordinary Shareholder Meeting adopted a resolution to distribute PZU’s net profit for the financial year ended 31 December 2016, in which it resolved to distribute the amount of PLN 1,208,932,200, or PLN 1.40 per share, as dividend. The date on which the list of shareholders entitled to a distribution was 29 September 2017. The dividend was paid on 19 October 2017.
The Polish FSA’s recommendation on dividend payments from the profits generated in 2017
As it was the case in previous years, on 5 December 2017 the Polish Financial Supervisory Authority took a stance on the dividend policy of banks, insurance and reinsurance companies, universal pension fund companies, brokerage houses and mutual fund companies in 2018 (download).
As recommended by the supervisory authority, dividends should be paid only by insurance undertakings meeting certain financial criteria. At the same time, the dividend payments should be limited to no more than 75% of the profit earned in 2017, while the coverage of the capital requirement for the quarter in which the dividend was distributed should be maintained at no less than 110%. At the same time, the Polish FSA permits dividend distributions equal to the entire profit earned in 2017 provided that the capital requirement coverage (after expected dividends are deducted from equity) at the end of 31 December 2017 and for the quarter when the dividend is paid, is at least 175% for companies operating in section I and at least 150% for companies operating in section II.
Up to the date of preparing this Report on the activities of the PZU Group, the Management Board has not adopted a resolution concerning the distribution of profit for 2017.
Dividend paid by PZU from its earnings in the 2012 - 2017 financial years
|Consolidated profit attributable to the parent company (in PLN m)||2910||1 935||2 342||2 968||3 293|
|PZU SA’s standalone profit (in PLN m)||2434||1 573||2 249||2 637||5 106|
|Dividend paid for the year (in PLN m)||***||1 209||1 796||2 591||4 663|
|Dividend per share for the year (PLN)||***||1,40||2,08||3||5,40**|
|Dividend per share on the date of record (PLN)||1,40||2,08||3||3,4||4,97|
|Ratio of dividend payment to consolidated profit attributable to the parent company||***||62,5%||76,7%||87,3%||89,1%*|
|Dividend yield in the year **||3,3%||6,3%||8,8%||7,0%||11,1%|
|TSR (Total Shareholder Return) ***||31,2%||3,7%||-23,8%||15,8%||14,1%|
* dividend paid from excess capital in 2013 (PLN 2 per share) not included in dividend payment ratio
** ratio calculated as dividend as at the record date to the share price at the end of the reporting year
*** up to the date of preparing this Report on the activities of the PZU Group, the Management Board has not adopted a resolution concerning the proposed distribution of profit for 2017