The PZU Group assessed the adopted estimates and assumptions taking into account the impact of the COVID-19 pandemic on individual line items of assets and liabilities, revenues and costs. Considering the significant uncertainty regarding the further development of the economic situation, the adopted estimates are subject to change.
The table below presents the elements of the consolidated financial statements impacted by the COVID-19 pandemic and points to notes in which detailed disclosures regarding the respective issues are presented.
|Note no.||Area||Impact of the COVID-19 pandemic on PZU Group’s activities|
|188.8.131.52||Interest rate risk||Reduction of net interest income due to interest rate cuts.|
|7.5.4||Liquidity risk||Increase in banking sector’s liquidity. No significant influence on the insurance operations of the PZU Group.|
|9.3||Fair value hierarchy||The increased volatility in the financial markets, reduced liquidity of some segments resulted in the reclassification of some assets to lower fair value levels.|
|27.3||Goodwill||The impairment losses for goodwill following from the acquisition of Alior Bank and Bank Pekao SA.|
|28||Intangible assets||The impairment losses for intangible assets following from the acquisition of Alior Bank.|
|32.2||Investment property||Decrease in the transaction volume and liquidity in the real estate market. As at 31 December 2020 some sectors returned to business as usual.|
|38.1.1||Expected credit losses – loan receivables from clients, investment financial assets||
The adverse impact on the economy that may exacerbate the financial standing of some borrowers. The PZU Group has modified its approach to the calculation of expected credit losses taking into account, among others:
In the calculation of its technical provisions, the PZU Group monitors, among other things: