New entrant targets savings, mortgages for future revenue

Despite being such a new entrant on the market, the new banking intermediary already boasts a turnover of zł.31 million (€6.5 million) derived from selling car loans - a banking sub-sector PDK expects to expand following European Union accession owing to a variety of economic and regulatory factors. "We would like to make zł.150 million this year," says Ireneusz Wšsowicz, vice president at PDK. "We would like to double this number next year." Wšsowicz bases his revenue expectations on company plans to increase revenue streams by tapping into new operations as an intermediary supplier of mortgage loans and savings accounts to new customers as well as those it already has in the car loan sector. At present, it is an intermediary provider of loans for new and used cars via Bank BPH. Wšsowicz says that due to EU regulations that will change the VAT structure for leasing cars, he expects potential leasing customers to rethink their strategies and buy a new or used vehicle instead of lease. Thus it will add to its growing loan portfolio. What is more, he said that since PDK's inception, customers have been opting to buy cars before May 1 because they expect a steady rise in prices after the country joins the EU. "Now people are looking for cars," he explains, "because with the upcoming EU [membership] they expect prices to go up." Plans to enter the mortgage business are based on the fact that that market grew by 40 percent last year, and the same or greater figures are expected as the market develops, Wšsowicz says. Banking analysts, for their part, expect mortgages in Poland to follow the rapid success they've had in the West, particularly the in USA. "We've had pretty good experience with mortgages in the past," he says, noting that he used to work at PDK competitor PTF, a mortgage provider. "It's even safer than car loans." The goal for providing both savings accounts is simple: "If we have an individual customer, it is very easy to also offer them an account with a credit card," he says. Such a strategy is also reflective of many local banks' general strategy to become a one-stop shop as customers are increasingly demanding many services under one roof. Yet, while PDK realizes that it cannot easily grab a majority share of the market, it will try to do so. "It's not an easy market," he said. And with the growing competition "the margins are getting smaller and smaller." He notes, however, that PDK will differentiate itself with "quality of service," by providing its services to customers anywhere. This is part of the strategy through which the company hopes to become a leader in the car loan market. "I believe that if we keep this pace up then in two to three years we might well become a leader in the car loans market," Jarosław Gšsiorek told Puls Biznesu last week.