Poland’s Banking Sector: Regulations, Supervision, and Key Players

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Introduction

In Poland, significant banks are those that have shares traded on a regulated market, hold at least 2% of the banking sector’s assets, deposits, or own funds. Foreign credit institutions can operate in Poland through branches or cross-border activities, subject to authorization from their home country’s supervisory authority.

Banking Regulations

The Polish Financial Supervision Authority (PFSA) is responsible for authorizing and supervising banks, as well as enforcing regulations related to banking, insurance, and pensions. The PFSA also monitors the deposit guarantee scheme and crisis management in the financial system.

Types of Banks

Commercial Banks

Commercial banks are the largest banks in Poland, offering a wide range of financial services.

Cooperative Savings and Credit Unions

These institutions collect funds from their members, provide loans and credits, and conduct financial settlements on their behalf. As of February 2021, there were 25 such unions in Poland.

Mortgage Banks

Mortgage banks grant mortgages using mortgage-backed bonds, which reduces loan financing costs. As of February 2021, there were approximately five mortgage banks in Poland.

Supervision

The PFSA is responsible for supervising banks, including commercial banks, branches and representative offices of foreign banks and credit institutions. The primary tool used by the PFSA is the annual supervisory review and evaluation of the bank. The authority also has the power to carry out control activities at banks, which may include inspections or investigations.

Consolidated Supervision

The PFSA is responsible for consolidated supervision in Poland, including foreign groups. The authority enters into agreements with competent authorities from other countries to cooperate in the exercise of supervision on a consolidated basis.

Key Players

Polish Financial Supervision Authority (PFSA)

Responsible for authorizing and supervising banks, as well as enforcing regulations related to banking, insurance, and pensions.

Bank Guarantee Fund (BGF)

Guarantees bank deposits and is responsible for resolving financial institutions at risk of bankruptcy.

National Bank of Poland (NBP)

Oversees the payment system in Poland.

Recent Developments

In 2020, the implementation of provisions on the approval of financial holding companies under the new Article 21a of CRD IV was introduced. The law is expected to be signed by the President of Poland later in 2021.

Summary

Poland’s banking sector is subject to a range of regulations and supervision from various authorities, aiming to ensure stability and security in the financial system.