Regulatory environment
The financial and organizational situation of the PKO Bank Polski SA Group was affected i.e. by the following:
| Description | Influence | |
| Low level of key interest rates | resolution of the Monetary Policy Council (MPC) No. 1/2015 (Official Journal of the NBP of 2015 item 2) introducing reduction of the basic interest rates from 5 March 2015 (including: a decrease of the reference rate to 1.5% and lombard loan rate to 2.5%). | strong impact of net interest income |
| Higher load banks to BGF | resolution of the Bank Guarantee Fund significantly increasing for the year 2015 burden on the banks for bank deposit guarantee scheme (settled linearly), including:- resolution No. 28/104 booster indicator for calculating the annual fee (from 0.100% to 0.189%);- No. 29/2014 boost ratio for calculating the charge prudential (from 0.037% to 0.050%). | strong impact on banks’ operating costs |
| Prudential requirements | regulation (EU) No 575/2013 of the European Parliament and of the Council on prudential requirements for credit institutions and investment firms, technical standards EBA and KNF recommendations concerning capital base, including the level of liquditiy coverage requirement of 60% | capital base of banks, supervisory prudential standards, business activity of banks, implementation costs. |
| Reduction of income from card services | amendment to the law on payment services (Journal of Laws of 2014, item 1916) introducing limits on the interchange fee rates (0.2% for debit cards and 0.3% for credit cards) | significant impact on non-interest banks' income |
| Additional requirement when granting housing loans | Recommendation S on credit exposures secured by mortgage (Official Journal of PFSA No. 23/2013 item 23) increasing from 1 January 2015 the requirement for an own contribution from 5% to 10% | level of lending, interest net income and net fee and commision |
| Apartment for young(MDM Program) | amendment to the law on state aid in the acquisition of housing by young people (Journal of Laws of 2015, item 1194) extending the number of people who can use MDM program to support the program and the rules for support; effective from 1 September 2015. | level of lending, the financial results of banks |
| Increased access to consumer bankruptcy | amendment to the Bankruptcy and Reorganization Act (Journal of Laws from 2014 item 1306) liberalizing from 1 January 2015 consumer bankruptcy rules | impact on the credit risk |
| Support for the issuance of non-treasury bonds | Act on Bonds (Journal of Laws 2015, item 238) on the implementation from 1 July 2015 solutions to support the market development of long-term Treasury debt securities, as an additional source to bank loans, a source of capital by companies and local governments | issuance of corporate and municipal bonds, as an alternative source of financing; risk segment of corporate loans |
| Good practicies in liquidity risk management | Recommendation P concerning the management of financial liquidity of banks (Official Journal of the PFSA, item 14), which determines the adjustment of banks by the of 2015 | increase bank's operating costs; measuring and managing liquidity risk |
| The mobilization of FOŚG funds | Resolution No. 87/DGD/2015 issued by the Management Board of Bankowy Fundusz Gwarancyjny on 26 November 2015 concerning the payment of guaranteed funds to the deposit holders of Spółdzielczy Bank Rzemiosła i Rolnictwa to 30 November 2015 | costs |
| Burding the banks for the Borrowers Support Fund | Act of 9 October 2015 year (Journal of Laws of 2015, item. 1925) on support of borrowers in a difficult financial situation, obliges lenders to pay for the BSF funds in proportion to the size of the portfolio of housing loans to households, which delay in repayment of principal and interest exceed 90 days. The total contribution of banks in the financing of the BSF will amount to 600 million PLN. | strong impact on the operating costs of banks |
| Offset capital of PFSA | Individual recommendation of PFSA for banks with substantial involvment in mortgage loans in foreign currencies | increase in capital requirements, hedge risk associated with the portfolio of foreign currency mortgage loans |
| Banking enforcement document | change of the Banking Law (Journal of Laws of 2015, item 1854) repealing from 27 November 2015 the permissions of banks to issue bank enforcement title. | increase in the bank's operations costs, including those related to the protection of claims, legal proceedings, changes in procedures and functionality of IT systems. |
| Restrictions on the activities of OPFs | the Act introducing changes in the policies for disbursement of pensions from funds accumulated in open pension funds (Journal of Laws of 2013 item 1717) including allowing of increased exposure of OPFs in companies listed abroad (from 10% to 20%) from 1 January 2015 roku, and introducing the exposure of OPFs in domestic companies stocks (from 75% to 55%). | operational activiites of pension funds; the principle of "slider" that affects the decrease in funds assters of OPF, the decline in the financial results of PTE |
| The possibility to deduct 50% of VAT on fuel fo cars | Expiry of article 12 of the Law of 7 February 2014 amending the Act on tax on goods and services and certain other acts (Journal of Laws of 2014, item 312) resulting in the right do deduct 50% of VAT on purchased fuel for passenger cars used for private and business purposes | supporting the development of leasing vehicles |
| Changes in the conduct of insurance business | Solvency II package on the insurance and reinsurane activities, including the valuation of technival-insurance provisions, risk management system and disclosure obligations (Official Journal EU L 335 of 17 December 2009); changes in the insurance and reinsurance activity (Journal of Laws of 2015, item 1844) in force from 2016. | adjustment costs of insurance companies, preparation for changes in the standards of capital and prudential requirements. |
| Changed restrictions in insurance distribution by Banks | resolution of the PFSA No. 183/2014 on Recommendation U concerning bancassurance (Official Journal of the PFSA of 2014 item 12) and resolution of the PFSA No. 184/2014 (Official Journal of the PFSA of 2014 item 13) concerning i.a. distribution of insurance products | business model considering bancassurance, risk management, revenues from operations and operating costs of banks and insurance companies |
The activity of the PKO Bank Polski SA was affected by the following new legislation introduced in Ukraine (on which subsidiary KREDOBANK operates), including:
- The Act No. 424-VIII/2014 introducing restrictions on early withdrawals from term deposits from 15 May 2015,
- The Act No. 629-VIII/2015 concerning the system of guaranteeing bank deposits,
- Resolution No. 820/2015 of the NBU Management Board introducing changes to create mandatory reserves by banks (6.5% for current deposits in UAH and foreign currencies and 3% for fixed-term deposits) from 31 December 2014,
- Resolution No. 859/2014 of the NBU Management Board on extending to 1 January 2019 of not applying sanctions against banks that do not comply with regulatory requirements as a result of the UAH devaluation, annexation of the Crimea and the war in the Donetsk and Luhansk circuit and defining its specific principles of banking activities,
- Resolution No. 860/2014 on tightening the requirements for banks that benefits from the stabilization loans; interest rates of stabilization loans; interest rates of stabilization loans was set at a discount rate plus 1.5 p.p. from 1 January 2015,
- Resolution No. 867/2015 on obliging banks to organize a risk management system (effective from 31 December 2014),
- Resolution No. 22/2015 of the NBU Management Board on enabling early repayment of foreign currency loans by non-residents from 17 January 2015,
- Resolution No. 81, 154, 557 and 627 of 2015 of the NBU Management Board on increasing the NBU discount rate respectively from 6 February 2015 by 5.5 p.p. to 19.5% and from 4 March 2015 by 10.5 p.p. to 30%; from 28 August 2015 in lowering the discount rate by 3 p. to 27%, and from 25 September 5 p.p. to 22%,
- Resolution No. 124, 129, 248, 354, 551, 581, 657 and 863 of 2015 NBU Management Board on introducing a number of changes in the implementation of monetary-credit and currency market transactions,
- Resolution No. 160 and 354 of 2015 of the NBU Management Board on introducing a number of changes in the money market transactions and restrictions on the foreign exchange market, including the prohibition of lending in UAH when the collateral are the property rights to funds in foreign currencies,
- Resolution No. 313/2015 of the NBU Management Board on specifying the time limits to fulfil the capital adequacy requirements of banks, including not less than 5% until 1 February 2016,
- Resolution No. 417/2015 of the NBU Management Board on imposing additional disclosure requirements on banks about customers and carried transactions,
- Resolution No. 424/2015 of the NBU Management Board preventing early withdrawal of funds from fixed-term deposits,
- Resolution No. 540/2015 of the NBU Management Board obliging banks to report according to international accounting standards from the quarter of 2016,
- Resolution No. 615/2015 of the NBU Management Board on loans refinancing and accepting collaterals, including foreign currencies.
The regulatory solutions which will affect the financial position of banks and their groups in Poland over the following quarters include, i.a.:
- The Act on tax of certain financial intuitions (Journal of Laws pos. 68) since February 2016 defines the taxation of assets value of banks and insurance companies, which will have a significant impact on their financial results and profitability of banks and insurance companies,
- CRR Regulation introducing change in the rules of determining the own funds and an increase in the requirement limit coverage ratio LCR by 10 p.p. to about 70% from 1 January 2016,
- Macro prudential law foresees an increase by 1.25 p.p. of minimum levels of capital ratios (Tier1 to the level of 10.25%, TCR to the level of 13.25%) from 1 January 2016,
- Recommendation S of the Banking Supervision Authority increasing the requirement for own contribution from 10% to 15% from 1 January 2016,
- Recommendation P of the Polish Financial Supervision Authority amending the principles of liquidity risk management from 1 January 2016,
- Act on complaints processing by financial market participants defining shorter handling of complaints,
- Amendment of the Act on capital market supervision, introducing changes in the financing of Polish Financial Supervision Authority, by brokerage houses and investment fund companies from 1 January 2016,
- Amendment to the law of mortgage bonds and mortgage banks, introducing the principles of enhancing the safety of Polish bonds, which will have an impact on the acceleration of the mortgage market and mortgage bonds from 1 January 2016.