20. Other operating income and expenses
Report Online
2020
Accounting policies
Other operating income and expenses comprise income and costs not directly related to banking activities. Other operating income mainly includes gains on the sale of investments in residential real estate, sale/scrapping of property, plant and equipment, intangible assets and assets held for sale, damages, fines and penalties received, and income from lease/rental of properties. Other operating expenses mainly include provisions for refunds to customers on early repayment of consumer and mortgage loans, losses on sale /scrapping of property, plant and equipment, intangible assets and foreclosed collateral, and donations made.
In the Group companies, other operating income and expenses also include, respectively, revenue from the sale of finished goods, goods for resale and materials, and the cost of their manufacture.
Other operating income and expenses also include provisions recognized and released for legal claims, excluding legal claims relating to mortgage loans in foreign currencies and other provisions.
Financial information
| OTHER OPERATING INCOME | 2020 | 2019 |
|---|---|---|
| Net sales of finished goods and services | 85 | 106 |
| Gains on sale or scrapping of property, plant and equipment, intangible assets and assets held for sale | 49 | 45 |
| Damages, compensation and penalties received | 25 | 23 |
| Ancillary income | 11 | 12 |
| Recovery of receivables expired, forgiven or written off | 4 | 6 |
| Release of provision for potential return of fees and commission to customers | – | 58 |
| Provision for future payments | 4 | 1 |
| Release of provision recognized for legal claims excluding legal claims relating to mortgage loans in convertible currencies | 5 | 7 |
| Gain from a bargain purchase* | – | 102 |
| Other | 67 | 45 |
| Total | 250 | 405 |
| OTHER OPERATING EXPENSE | 2020 | 2019 |
|---|---|---|
| Costs of products and services sold | (13) | (22) |
| Losses on sale or scrapping of property, plant and equipment, intangible assets and assets held for sale | (45) | (34) |
| Damages, compensation and penalties paid | – | – |
| Donations made | (27) | (23) |
| Sundry expenses | (15) | (14) |
| Provision recognized for potential refunds of fees and commission to customers | (106) | (127) |
| Provision for future payments | (1) | (1) |
| Provision recognized for legal claims excluding legal claims relating to mortgage loans in convertible currencies | (59) | (8) |
| Other | (63) | (92) |
| Total | (329) | (321) |
Under “Provision recognized for legal claims excluding legal claims relating to mortgage loans in convertible currencies”, the Group recognized the cost of PLN 41 million of the penalty imposed on the Bank by UOKiK for the Bank using clauses governing the method of determining the foreign currency buy and sell rates in template agreements with customers (further discussed in the Note “Legal claims”).