Foreign deposits
In a recent report international rating agency Fitch Ratings said that risk management has improved at Polish banks as a result of the presence of foreign investors.
"The presence of strong strategic investors has helped the Polish banking system survive the economic turmoil of recent years, in two cases preventing default by injecting fresh capital," says Tim Beck, an associate director in Fitch's financial institution group. "These investors have since upgraded risk management techniques, which should help banks better cope with future downturns."
The report also notes that profitability in the sector is likely to improve, despite increasing competition and falling margins. Polish banks have been successful in growing fee and commission income, and lower costs are expected as banks benefit from recently completed IT investments.
Fitch says EU accession has seen enhancements in the regulatory and supervisory framework in Poland, and nearly all relevant EU banking directives have been implemented. Polish Accounting Standards are now more or less in line with International Financial Reporting Standards (IFRS) and no major impact is expected from the switch to IFRS in 2005. Although its bankruptcy law is now in line with EU regulations, Fitch notes that the slow and inefficient Polish legal system presents a substantial obstacle for banks wishing to foreclose on collateral or initiate insolvency proceedings. (Reuters)
Laurence Mackin
"The presence of strong strategic investors has helped the Polish banking system survive the economic turmoil of recent years, in two cases preventing default by injecting fresh capital," says Tim Beck, an associate director in Fitch's financial institution group. "These investors have since upgraded risk management techniques, which should help banks better cope with future downturns."
The report also notes that profitability in the sector is likely to improve, despite increasing competition and falling margins. Polish banks have been successful in growing fee and commission income, and lower costs are expected as banks benefit from recently completed IT investments.
Fitch says EU accession has seen enhancements in the regulatory and supervisory framework in Poland, and nearly all relevant EU banking directives have been implemented. Polish Accounting Standards are now more or less in line with International Financial Reporting Standards (IFRS) and no major impact is expected from the switch to IFRS in 2005. Although its bankruptcy law is now in line with EU regulations, Fitch notes that the slow and inefficient Polish legal system presents a substantial obstacle for banks wishing to foreclose on collateral or initiate insolvency proceedings. (Reuters)
Laurence Mackin
