IBERSOL | Integrated Management Report 2022

INTEGRATED MANAGEMENT REPORT 2022 8. Financing 8.1.Equity 8.1.1. Share capital Accounting policies Basic shares are classified in equity when paid. Incremental costs directly attributable to issuing new shares or options are shown in equity as a deduction, net of taxes, from inflows. When any Group company acquires shares in the parent company (treasury shares), the amount paid, including directly attributable costs (net of taxes), is deducted from the equity attributable to holders of equity in the parent company until the shares are cancelled, reissued or disposed of. When such shares are subsequently sold or reis- sued, any proceeds, after deducting directly attributable transaction costs and taxes, are reflected in the shareholders’ equity of the equity holders of the company. As at 31 December 2022 and 2021, the share capital of Ibersol was fully subscribed and paid up, represented by 46.000.000 registered shares with a nominal value of 1 euro each. 8.1.2. Own shares In 2022 the Group acquired 40.442 own shares from Banco BPI for €229,711. At the end of the year the company held 3.640.423 own shares purchased for 11.410.227 euros. 8.1.3. Reserves and retained earnings Currency conversion reserve The currency conversion reserve corresponds to the accumulated amount related to the appropriation by the Group of exchange rate differences resulting from the trans- lation of the financial statements of subsidiaries operating outside the Euro zone. Legal reserve Commercial legislation establishes that at least 5% of the annual net income must be allocated to reinforce the legal reserve until it represents at least 20% of the share capital. This reserve cannot be distributed except in the event of liquidation of the company. It may, however, be used to absorb losses, after the other reserves have been exhausted, or incorporated into the capital. In the periods presented, the legal reserve is not constituted by its maximum limit. 449