Corporate Governance - Internal Control System

Company Code of Practice

In addition to the regulations governing companies, the financial system in general and the securities markets in particular, the Board of Directors has approved a Code of Practice that includes rules governing the working of Millennium bcp and the individual behaviour of each of the employees of the Bank and of Millennium bcp in carrying out his/her duties.
The Code of Practice sets out the principles and rules to be observed in carrying on banking, financial, insurance and securities-trading business, particularly with regard to issues involving conflicts of interests, secrecy and incompatibilities.
The Code of Practice is distributed to every employee and discussed in a specific training module, being also available in the company's intranet.

Group Internal Control Systems

In performing its duties, the Board of Directors exercises constant control of the risks inherent in banking business. This control is also undertaken in a more detailed, systematic manner by all the departments of the Bank in the day-to-day management of their respective areas. Risk analysis and management also takes into account the consolidated perspective.
The supervision and regular control of the business and procedures of all the Bank's business areas is fully decentralised. It is complemented by the management support areas, namely the Risk Control Division, the Accountancy Division and the Asset and Liability Management Division.

On par with the hierarchic structure that has been established - which ensures proper segregation of functions - the suitability and reliability of the automated systems underpinning the entire business and the management information quality, there is also a formal definition of the internal control procedures and systems that have been implemented. These have been systematised in keeping with their nature and relevance, and emphasis is lent to the following:

• the "Credit Grant Regulation", the aim of which is to establish the guidelines governing extending credit and to establish the composition, duties, responsibilities and working of Millennium bcp's Concession Credit Divisions;
• the "Handbook of Risk Management Principles and Rules for Financial Transactions", which establish the Bank's overall policy and the general principles governing the Bank's activity on the financial markets.

The Audit Division performs ongoing assessment of the control systems implemented, employing appropriate methodologies and of compliance with prevailing rules and regulations.