Operating segments

At the end of 2019:

• the aggregate financing of customers in the retail segment amounted to nearly PLN 179 billion (+6.4% y/y). This was mainly due to the growth of the portfolio of PLN-denominated mortgage banking loans (+PLN 7.8 billion), loans for companies and enterprises (+PLN 2.1 billion), and retail and private banking (+PLN 2.9 billion), accompanied by a decrease in the portfolio of foreign-currency mortgage loans (-PLN 2.0 billion),
• lease receivables in the retail segment amounted to PLN 13.0 billion (+16.3% y/y),
• savings in the retail segment increased to PLN 263 billion (+12.3% y/y) due to an increase in the level of retail and private banking deposits (mainly current deposits) and Treasury savings bonds.

The bank strengthened its position as the market leader in terms of the number of current accounts, which went up by almost 14% over the past three years, despite a drop in the number of bank’s outlets. According to the new criteria for account classification, the bank reports all active accounts that have potential for increased cooperation with the customer.

Group’s activities on the housing loans market:

• granted loans to individuals totalling PLN 15.6 billion, maintaining its leading position on the market with a 25.7% share over the whole of 2019,
• introduced new “green mortgage” offer that gives customers a lower margin if they provide an energy-performance certificate for the real estate property that constitutes collateral,
• replaced the reference rate for new mortgage loans and advances to 6M WIBOR from 3M WIBOR,
• enabled activation of a further tranche of mortgage loans through the iPKO service,
• enabled mortgage-related correspondence to be sent to the customer’s e-mail address.

Activities with regard to consumer loans:

• extended product offer to include a loan earmarked for financing the purchase and installation of photovoltaic panels,
• introduced the possibility of documenting income based on the account history,
• cancelled the requirement to apply security for a revolving loan up to PLN 200 thousand,
• increased the availability of financing for customers by reducing the minimum amount of cash advances to PLN 500 and increased the maximum available amount of the loan to PLN 200 thousand,
• supported financing of entities in culture and creativity sectors, as part of the new “Creative Europe” guarantee programme launched on the initiative of the European Commission.

Activities with regard to the transactions and savings offer:

• introduced a deposit for new funds with an interest rate of 1.9% p.a. to mark the bank’s centenary,
• introduced the possibility to pay income tax on the governmental portal www.epodatki.gov.pl using the Paybynet system,
• extended the time for concluding currency conversion transactions via iPKO dealer for corporate customers – the currency exchange office is available 24 hours from Monday to Friday,
• carried out a subscription for structured deposits,
• introduced the “Safe Plan” life insurance for personal banking customers, offering financial safety for close relatives in the event of death of the insured person,
• launched a virtual car rental centre at pkoleasing.pl to support digitalization of customer services,
• launched a partnership program designated for the Premier League clubs for promotion of bank’s products.

The bank supports the Polish economy and participates in financing of strategic investments and local government projects. Such financing takes the form of syndicated and bilateral loans or issues of securities.

At the end of 2019, the total financing of corporate customers amounted to PLN 74 bln (+4.4% y/y). The increase was mainly related to loan and lease receivables.

We offer our clients wide access to funds for the financing of complex investment projects, and services of advisors focused on selecting the optimal form of financing and repayment terms.

We have also intensified our activities in respect of pension products: Employee Pension Schemes (PPE – Pracownicze Programy Emerytalne) and Employee Capital Plans (PPK – Pracownicze Plany Kapitałowe) offered to corporate customers.

The level of corporate deposits as at 31 December 2019 amounted to nearly PLN 50 bln and decreased by more than PLN 5 bln since the beginning of the year, mainly due to a drop in term deposits of the budgetary sector.

Group’s activities related to customer service and transaction banking:

• extended the agreement with the Social Insurance Office (ZUS) for opening and maintaining consolidated FUS, FEP and ZUS accounts and executing mass transfers,
• implemented regulatory changes resulting from PSD2,
• implemented regulatory changes resulting from changes in the VAT regulations,
• introduced multi-currency International Cash Pooling service,
• individual accounts for the so-called Small Payment Institutions,
• enabled SWIFT GPI transfers – immediate money transfers abroad,
• included treasury transactions on the market of greenhouse gas emission allowances.

With regard to financing corporate customers:

• signed 1 792 agreements for management of the Employee Capital Plans (PPK) including 1 301 agreements with companies that employ mote than 250 persons – achieving the leader position among financial institutions offering PPK,
• concluded 21 loan agreements in the form of a banking consortium totalling PLN 28.6 billion,
• 8 agreements for the arrangement of corporate bond issues,
• 164 agreements for the issue of municipal bonds with a total value of PLN 1.25 billion.

With regard to brokerage activities:

• turnover on the secondary market of shares reached PLN 29.7 billion, which accounted for 7.5% of the market turnover, and placed the Brokerage House of PKO Banku Polskiego as a leader in the ranking of brokerage houses,
• on the primary market, organized transactions of the sale of shares of Santander Bank Polska SA by Deutsche Bank with a value of approx. PLN 560 million and sale of SPO (Secondary Public Offer) of the shares of Grupa Azoty Zakłady Chemiczne “Police” SA with a value of approx. PLN 501.6 million,
• maintained nearly 123 thousand securities and cash accounts and over 223 thousand register accounts. In terms of the number of securities accounts, our Brokerage House ranked third among 38 market participants,
• provided participation services in 377 funds and sub-funds managed by 12 fund management companies.

Our customers can use iPKO and iPKO biznes services as part of electronic banking, which provides them with continuous access to information on their accounts and products. We constantly promote the remote use of online bank accounts, self-management of accounts and banking products in the transaction service, which allowing us to reduce the costs of using banking services.

The iPKO biznes electronic banking system is addressed to all institutional customers interested in gaining online access to the standard products and specialized services, including via the mobile application.

The Contact Centre of PKO Bank Polski plays an important role in serving retail customers. Bank’s hotline employs several hundred consultants who remain at customers’ service 24 hours a day. The consultants not only handle the telephone calls, but also answer customers’ questions and requests electronically – both e-mail and website requests. Customers may also send messages in the iPKO or Inteligo transaction service and through a special Facebook tab.

In 2019, the structures of the Retail Customer Service (Contact Centre) and the Operating Centre were combined, which allowed the combined team to increase the number of tasks performed (measured per one FTE) in selected processes by approx. 27% and resulted in a significant increase in sales (+70% y/y). PKO Bank Polski is the third bank in Europe in which these structures have been combined.

As part of the process of automation of customer service, the Contact Centre consultants are supported by a robot that provides answers to verification questions, which shortens the time of their conversation per customer by as much as 20 seconds.

At the end of 2019, the network of branches of PKO Bank Polski consisted of 1 043 retail branches clustered in 11 regional divisions, 8 private banking offices and 11 corporate banking offices. Compared with the end of 2018, the number of retail branches decreased by 40.

The optimization of the branch network is carried out on a continuous basis, and the decision on the branch’s operation in a particular micro-market is made with reference to economic criteria, taking into account the growth potential of that micro-market. The bank constantly improves customer service conditions, as part of the new standard of branches, which assumes creating a modern bank facility, friendly to the bank’s customers and employees. The new standard is supported by new technologies – a WIFI zone, self-service tills, mobile phone chargers, LCD monitors, tablets, authorization of selected customer orders at the counter using text messages, which firmly support the process of educating customers and changing their habits in using banking services.

The sales network of the corporate segment comprises 33 Regional Corporate Centres clustered in 7 Corporate Regional Divisions and branches in Germany and Czech Republic.

The Private Banking Offices serve customers in the largest Polish cities: Warsaw, Gdańsk, Kraków, Katowice, Poznań, Wrocław, Łódź, Szczecin and Bydgoszcz. At the end of 2019, the Private Banking Centre managed a portfolio of assets with a value of nearly PLN 32 billion (2018: PLN 25 billion). Over 2019, the number of customers served reached 15.3 thousand (+13% y/y).

The Corporate Banking Centre is an optimal environment created for the development of businesses with revenues ranging from PLN 5 million to PLN 30 million, and similar product and service needs.

A separate service centre makes it possible to project the image of PKO Bank Polski as a reliable business partner for Polish businesses thanks to:

• a specially-appointed service team,
• creation of a specialized group of mobile advisors cooperating directly with credit analysts,
• improving the advisors’ credit competences, better matching of the product and price range, tailored to customer’s needs, and reducing the time required to make a credit decision due to improvements to lending process,
• limiting paper documentation exchanged with the bank, using remote methods of direct communication with customers, as well as automating processes via iPKO.

All individual and corporate customers of PKO Bank Polski who have cards for their bank accounts can use the self-service cash points with touch screens.

The following functions are available to customers: cash deposits into their own account, cash withdrawals, transfers between their own accounts, transfers to any account, setting up a deposit account, checking or printing out the account balance, among many other transactions currently available in ATMs.