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It will be necessary to move increasingly away from free banking - ZBP

It will be necessary to move increasingly away from free banking – ZBP

The Polish Banking Association, in its report on the economic situation of banks, published on Thursday, wrote that it would be necessary to abandon free banking services more often, or to charge fees for keeping large sums of money in a bank account.

On Thursday, the Polish Banking Association published a report on the economic situation of “Banks in 2020”. In this, the Polish Banking Association referred to the opportunities and challenges that Polish banks faced in 2021. Among the challenges, as indicated, is the low interest rates currently in force in Poland.

“Very low interest rates are a challenge for the banking sector. They impose a reduction in the differential between interest rates on loans and deposits. In conditions where about 70% of Polish banks’ income is currently generated from interest income, lowering interest rates is a major challenge to the profitability of banks. It is a question. On the scale of the necessary change in the banking business model, which has been implemented in the Eurozone countries for years with varying degrees of success, “the report reads.

According to the Polish Banking Association, one way to deal with low interest income is to look for other sources of income.

“The aforementioned reduction in interest income will require banks to pay more attention to the increase in non-interest income. In recent years, it was a limited success. In 2020, the increase in commission income was several percent, but other non-interest income decreased. Therefore, it will be necessary to move away from free banking services often, or to impose fees for keeping large funds in the bank account. “

At the same time, the Polish Banking Association indicated that the recovery of the economic situation after the epidemic may present an opportunity for financial institutions.

“Besides the improvement in the macroeconomic situation and the openness of the economy after the epidemic, the demand for bank loans may increase dramatically. This may apply to consumer loans, as well as corporate loans. Banks have large funds that can be devoted to developing lending,” the Polish Banking Association informed.

Another challenge highlighted by the Polish Banking Association was the issue of foreign currency loans. There are more and more lawsuits related to foreign currency loans. In addition, KNF came up with its own proposal to solve the problem of these loans by transferring them.

“Regardless of the way to go about solving the problem of foreign currency loans, there is no doubt that every year this problem becomes an increasing challenge for banks, including reputable banks. Even as more and more loans are paid off over time, the problem does not appear to be a problem. . Be Younger “- assessment of the Polish Banking Association.

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Regulatory issues are another challenge for banks.

The Polish Banking Association report wrote: “In the area of ​​major precautionary regulations for banks, more regulations, standards and draft prudential regulations have recently been published, which will have a strong impact on the level of banks’ capital requirements. ” .