Poland - FSA publishes consolidated data for banking sector for September 2012; National Bank to hold conference on the measurement of inflation expectations for the implementation of monetary policy

On Friday, 2 November 2012, the Polish Financial Supervision Authority (Komisja Nadzoru Finansowego – KNF) published consolidated data for the Polish banking sector for the month of September.  The data is based on information reported through 29 October, and is to be considered preliminary and subject to subsequent revision.

Source: Dane miesięczne – wrzesień 2012 (2012-11-02)

Analysis: Below are some figures taken from the September data as well as some calculations based upon the published figures.  The figures and calculations given here are for commercial banks only (literally “krajowe banki komercyjne działające z oddziałami zagranicznymi”, i.e., both domestic banks and foreign banks operating through domestic branches).  All values are expressed here in Polish złotych (PLN) (1 EUR = 4.1159 PLN at time of writing).

General:

Number of domestic commercial banks (liczba krajowych banków komercyjnych)

For September 2012: 46, unchanged from August.

Number of branches of foreign banks (liczba oddziałow instytucji kredytowych)

For September 2012: 23, unchanged from August.

Deposits:

Total deposits from non-financial customers:

Deposits in PLN: 556,677,806,492

Deposits in EUR: 46,252,118,014

Deposits in other currencies: 25,986,541,993

Capital adequacy:

Capital adequacy ratio (CAR) (współczynnik wypłacalności (“solvency ratio”))*

Solvency ratio = Fundusze własne dla współczynnika wypłacalności ÷ (Wymogi kapitałowe × 12.5  × 100)

For September 2012: 117,733,773,971 ÷ (67,061,764,300 × 12.5  × 100) = 14.04%

Highest since Dec. 2009: 14.311% (April 2012).  Lowest since Dec. 2009: 12.967% (Nov. 2011).

*Statutory requirement for individual banks according to the Banking Act of 1997: in the case of domestic banks, 15% for the first 12 months of operation, 12% for the next 12 months of operation, and 8% thereafter (art. 128, para 1, subpara. 3); in the case of foreign banks carrying out operations through a branch in Poland, 12% for the first 18 months of operation and 8% thereafter (Art. 42f, para. 1).  See Ustawa z dnia 29 sierpnia 1997 r. Prawo Bankowe (Dz.U. z 2002 r. Nr 72, poz. 665).

Tier 1 ratio (współczynnik wypłacalności dla funduszy podstawowych (tzw. fundusze Tier 1)):

For September 2012: 12.629%, up from 12.537% in August.

Highest since Dec. 2009: 12.854% (April 2012).  Lowest since Dec. 2009: 11.497% (Nov. 2011).

Income:

Interest income (Przychody z tytułu odsetek)

For September 2012: 48,910,827,809.

Highest since Dec. 2009: 58,506,134,841 (Dec. 2011).  Lowest since Dec. 2009: 4,145,472,429 (Jan. 2010).

Interest expense (Koszty odsetek)

For September 2012: 24,918,980,515.

Highest since Dec. 2009: 27,138,750,718 (Dec. 2011).  Lowest since Dec. 2009: 2,008,597,514 (Jan. 2011).

Asset quality:

Proportion of non-performing loans to total loans (non-financial sector only) (NPL/L) (Sektor niefinansowy: utratą wartości ÷ kredyty ogółem)

Households (gospodarstwa domowe): 37,112,446,530 ÷ 494,960,645,917 = 7.498%

Non-financial enterprises (przedsiębiorstwa): 29,447,109,516 ÷ 254,181,739,146 = 11.585%

Non-profit institutions (instytucje niekomercyjne): 85,987,876 ÷ 4,216,965,982 = 2.039%

N.B.: The terminology used by the KNF is not always consistent.  In general the KNF follows the terminology prevailing in the Polish banking sector, but in its monthly data reports it often uses terms that are quite different.  For example, in general the KNF uses the terms “kredyty zagrożonye” (non-performing loans) and “współczynnik wypłacalności dla funduszy podstawowych” (solvency ratio of core capital), but in its monthly data reports these terms are replaced by “utratą wartości” (impaired claims/receivables/value) and “współczynnik Tier 1” (Tier 1 ratio).  Care is therefore required in calculating ratios across different KNF documents. 

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In other news, the National Bank of Poland (Narodowy Bank Polski – NBP) will be hosting an academic conference in Warsaw on 29-30 November 2012 entitled “Are We Really Forward-Looking?  Measuring and Testing Expectations – Central Bank Perspective”:

“…The workshop aims to gather the most recent research concerning advances in the measurement of expectations, empirical testing of expectation formation process, especially the degree of their forward-lookingness, as well as the relevance of direct measures of expectations and empirical assessment of their formation for conducting monetary policy. Although inflation expectations are particularly interesting for central banks, during the workshop we would also like to analyze expectations related to other variables, such as household financial position, unemployment etc. …”

 Basic program outline (for complete program see here):

Thursday, 29 November 2012

Keynote lecture by Professor Roy Batchelor, Cass Business School, London
Survey Expectations in the New Economics

Session 1: Testing sticky information model
Chairman: Dr Christian Muller, Zurich University of Applied Sciences

Session 2: Process of expectations formation I
Chairman: to be decided

Session 3: Process of expectations formation II
Chairman: Dr Christina Gerberding, Deutsche Bundesbank

Friday, 30 November 2012

Keynote lecture by Professor Peter Sinclair, University of Birmingham and Bank of England
Inflation, Inflation Expectations and Financial Stability

Session 4: Exploiting density forecasts
Chairman: Professor Ryszard Kokoszczyński, University of Warsaw and National Bank of Poland

Session 5: Inflation expectations and monetary policy
Chairman: to be decided

Mark Pleas

Eastern Europe Banking & Deposits Consultant

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