Poland’s Banking Sector: Minimum Own Funds Requirement at 2%
The Polish banking sector is regulated by the Polish Financial Supervision Authority (PFSA) with a minimum own funds requirement of 2%. The PFSA ensures that banks comply with regulatory requirements, guaranteeing stability and safety for depositors and investors.
Foreign Credit Institutions in Poland
Foreign credit institutions can operate in Poland through a branch or cross-border, subject to authorization from the competent supervisory authority in their home country. Those foreign banks not established in an EU Member State must obtain a license from the PFSA before operating in the country.
Representative Offices of Foreign Banks and Credit Institutions
The PFSA authorizes foreign banks and credit institutions to open representative offices in Poland, which can advertise and promote the institution’s services within certain limits set by the competent supervisory authority of the bank’s home country.
Para-Banking Sector
Poland has a para-banking sector that includes cooperative savings and credit unions. These entities are authorized by the PFSA and operate solely for the benefit of their members.
Clearing System
The Polish Elixir clearing system, operated by Krajowa Izba Rozliczeniowa SA, enables efficient payment transactions between banks participating in the system.
Loan Granting
Loan granting is governed by the Banking Law. However, consumer loans can be granted by entities authorized under the Consumer Credit Act, such as banks, cooperative savings and credit unions, and lending institutions.
Supervision
The PFSA is responsible for supervising banks and ensuring their compliance with regulatory requirements. The authority’s main control tool is the annual supervisory review and evaluation of the bank, which examines areas that require close scrutiny from a business risk perspective.
Other Entities Involved in Banking Sector Regulation
In addition to the PFSA, other entities play important roles in Poland’s banking sector:
- Bank Guarantee Fund (BGF): guarantees bank deposits and resolves financial institutions at risk of bankruptcy
- Financial Stability Committee: responsible for macroprudential supervision
- National Bank of Poland (NBP): supervises the payment system
- Polish Competition and Consumer Protection Office: gives clearance for concentrations, inspects, and issues decisions on abusive clauses in consumer relations
Consolidated Supervision
The PFSA is responsible for overseeing holding companies that operate domestic banks. The authority may enter into agreements with competent authorities in other countries to cooperate in the exercise of consolidated supervision or delegate its tasks to another country’s authority if necessary.
Conclusion
Poland’s banking sector operates under a complex regulatory framework designed to ensure stability and safety for depositors and investors.