The electronic and magnetic behaviour of transition metal impurities is simulated by performing ab initio band structure calculations assuming ordered supercells with the composition Pd31TM (TM=Cr, Mn, Fe, Co, Ni). The results show the formation of narrow spin-split impurity bands originating from the TM with magnetic moments MTM deviating from the Slater-Pauling curve. Due to the high susceptibility of the Pd host the TM atom polarizes the surrounding Pd atoms (with MPd) causing the 'giant moments' when all the magnetic moment is attributed to the TM impurity. This polarization is described by a covalent polarization (CP) model, which the authors use for explaining both the change in sign of the Pd polarization in the TM series between Cr and Mn, and the linear dependence of the ratio MPd/MTM on the number of valence electrons of the TM. In addition, they estimate the Curie temperature by treating the localized TM moments in terms of a Weiss mean-field model and the itinerant electrons of the Pd host having spin fluctuations.