In 2013, activities undertaken by the Bank within the retail segment were focused on increasing attractiveness and competitiveness of offered products, with flexible reaction to changing market conditions.
In 2013, activities undertaken by the Bank within the retail segment were focused on increasing attractiveness and competitiveness of offered products, with flexible reaction to changing market conditions. In the area of retail segment PKO Bank Polski SA continued sustained development, focused on recognising and satisfying needs of customers with whom it wants to build strong, long-term relationships. Actions aimed to increase innovation in the new financial solutions, not only concerning products, but distribution channels as well, particularly in electronic banking and mobile payments were taken. In 2013, solutions developed within the ‘New Beat’ (Nowy rytm) project, which greatly raised the efficiency of the sales network and advisors activity were implemented in the retail network. The new motivation system and its clear assumptions and unified work organisation in every branch and at every position conducive to improve the quality of service and increase satisfaction of both customers and employees of the Bank.
The loan offer in the retail segment
PKO Bank Polski SA was consistently introducing its new product offer in the retail segment and intensified cooperation with entrepreneurs, supporting growth in Polish economy. The Bank also implemented projects aimed at a significant improvement in customer service quality. Such projects comprised improvement of the sales processes and enhancing service standards based on the results of regular customer satisfaction surveys. As at the end of 2013, gross loans to the retail segment of PKO Bank Polski SA amounted to PLN 110.8 billion and have increased by PLN 4.5 billion (i.e. by 4.2%) since the beginning of the year. This was mainly due to an increase in the portfolio of mortgage banking loans (+7.8% since the beginning of the year) and loans to small and medium enterprises (+3.6% since the beginning of the year).
Reatil segment loans structure as at 31.12.2013
Loans in the retail segment
| 31.12.2013 | 31.12.2012 restated | Change 2013/2012 | Change (in PLN million) | |
|---|---|---|---|---|
| Loans and advances granted gross, of which: | ||||
| retail and private banking | 20,399 | 21,601 | -5.6% | (1,202) |
| small and medium enterprises | 14,825 | 14,309 | 3.6% | 516 |
| mortgage banking | 68,795 | 63,815 | 7.8% | 4,980 |
| housing market (including refinanced by the State budget) | 6,807 | 6,621 | 2.8% | 186 |
| Total | 110,827 | 106,347 | 4.2% | 4 480 |
Housing loans
In 2013, the Bank maintained a strong position on the housing loan market. According to the data presented by the Polish Banks Association (‘PBA’), PKO Bank Polski SA ranked first on the market with a 30.3% share in sale of housing loans for retail clients. In 2013 the Bank organised the ‘Open doors’ campaign for the ‘WŁASNY KĄT hipoteczny’ housing loan.
Customers who have any current account with PKO Bank Polski SA, a credit card or life insurance and who signed the 4-year loss of job and hospital treatment insurance contract could avail themselves of the Bank's offer. Additionally, in entire 2013, the Bank introduced another special offers for customers buying real estate from selected developers, customers employed by certain firms or members of specific professions, as well as a special offer for the customers of the industry fair. Also implemented an Industrial Special Offer in terms of offering housing loan to persons employed in a bank or financial industry institutions.
The Bank's share in the new sale of housing loans for retail clients*
*Source: PBA
Consumer loans
The PKO Bank Polski’s offer includes a wide range of loan products. Retail customers can take advantage of both the standard Cash Loan, as well as the current financing available under the revolving loans and credit cards. A special offer of the Aurum and Platinium loans with available high amounts of loans and competitive pricing parameters, is available for the private banking clients. In 2013 PKO Bank Polski SA continued the action of promoting sales of consumer loans. As part of the initiatives supporting the sales of such products, PKO Bank Polski SA carried out promotional activities, mainly focused on the Cash Loan and the Aurum/Platinium loan. These activities were mainly aimed at offering the customers attractive credit terms, such as a lack of commission for granting the loan or a lower interest rate with minimum formalities.
Loans for small and medium enterprises
PKO Bank Polski SA consistently supports Polish entrepreneurship. It enables small and medium enterprises to finance both current and investment needs through an extensive and flexible lending offer. Due to the agreement signed between PKO Bank Polski SA and Bank Gospodarstwa Krajowego for a portfolio de minimis guarantee line ‘Portfelowa Linia Gwarancyjna de minimis’, under the government programme of support for small and medium enterprises, the entrepreneurs gain support in the form of BGK guarantee – de minimis, aimed at increasing the availability of lending facilities and launching additional funds for companies’ on-going activities. In 2013, circa 16 950 customers, who concluded 17 699 agreements, benefited from access to easier financing. The value of loans granted amounted to PLN 3.7 billion. This means that PKO Bank Polski SA was the biggest lender among nineteen banks granting loans with de minimis guarantees and held 31% of the market share (according to data provided by the Warranties and Guarantees Centre of Bank Gospodarstwa Krajowego).
Due to the great interest in ‘Portfelowa Linia Gwarancyjna de minimis’ from customers in the fourth quarter of 2013 PKO Bank Polski SA signed annexes to the agreement with BGK associated with prolongation of provision of guarantees period to 30 June 2014, with the increase in the guarantee limit granted up to PLN 2.3 billion and coverage of the investment loans repayment with the guarantee.
The deposit offer in the retail segment
In 2013, PKO Bank Polski SA continued activities aimed at offering more attractive deposits for retail clients, taking into account current market conditions and competitive position.
As at 31 December 2013, deposits of the retail segment of PKO Bank Polski SA amounted to PLN 125.4 billion and since the beginning of the year their volume increased by PLN 6.2 billion (i.e. by 5.2%). The increase in the retail and private banking deposit level contributed to this, due to the increase in the volume of current deposits and saving accounts, with the stable level of the volume of term deposits.
Deposits in the retail segment
| 31.12.2013 | 31.12.2012 | Change 2013/2012 | Change (in PLN million) | |
|---|---|---|---|---|
| Client deposits, of which: | ||||
| retail and private banking | 110,608 | 105,799 | 4.5% | 4,808 |
| small and medium enterprises | 9,516 | 8,766 | 8.6% | 750 |
| housing market clients | 5,241 | 4,646 | 12.8% | 594 |
| Total | 125,365 | 119,212 | 5.2% | 6,153 |
Current and savings accounts
PKO Bank Polski SA remains market leader in terms of the number of current accounts maintained, which amounted to 6.3 million as at the end of 2013. The increase in the number of accounts resulted from the diversified offer in terms of customer preferences as part of which i.a. the following products can be distinguished: PKO Konto bez Granic, SUPERKONTO Oszczędne, PKO Konto za Zero, PKO Konto dla Młodych, PKO Konto Pogodne, PKO Konto Pierwsze and PKO Junior. The offer is supplemented by savings accounts giving clients the ability to combine the interest dependent on the level of invested funds with the possibility of its flexible management. PKO Bank Polski SA has been involved in projects aimed at financial education for years.
Number of current accounts (in thousand of units)
The next step in the financial education of the youngest, in addition to the Economic Education Programme for the Youngest supporting School Savings Unions (Szkolne Kasy Oszczędności), was the introduction to the Bank’s offer the PKO Junior account. PKO Junior, one of the first online banking offers for children in the world, which at the same time is a comprehensive financial education programme. A child under the supervision of a parent acquires practical skills to manage its finances. The ‘PKO Junior oferta dla segmentu wiekowego 0–12’ programme (PKO Junior offer for the segment aged 0–12) two new types of accounts were offered: PKO Konto Dziecko (child account) and PKO Konto Rodzica (parent account), which enable purchasing long-term deposits and investment products for children under one consistent offer. PKO Konto Dziecka, after reaching the age of 13 by its owner, is automatically converted into PKO Konto Pierwsze, and after reaching the age of 18 the account is automatically converted into PKO Konto dla Młodych. In 2013 above 75 thousand of PKO Konto Dziecka accounts were sold.
In 2013, the offer of packages for small and medium enterprises as well as housing market clients was restructured. The changes were mainly aimed at better tailoring the product offer to the needs of entrepreneurs at each stage of a firm’s development. As part of the offer entrepreneurs may choose one of the following packages: Biznes Debiut 18, Biznes Rozwój, Biznes Komfort Plus, and Biznes Sukces Plus. As part of the products addressed to small and medium enterprises, PKO Bank Polski SA made available special industry sets, namely ‘Trade and services’, ‘Transport and logistics’, ‘Foreign Exchange’ and ‘Manager’. These sets guarantee free-of-charge and preferential terms of use for selected products or services, amongst others, debit cards, supporting accounts, virtual accounts, a currency exchange platform, and they make it possible to receive transaction bonuses for accepting payments in POS terminals.
As part of the new Biznes Komfort Plus and Biznes Sukces Plus packages, the Bank offered its customers ‘SuperAssistance Biznes’ insurance. This insurance enables customers whose firms are in a difficult position with regards to their operations to receive assistance in a swift and reliable manner or to obtain important information. The insurance cover includes, amongst others, medical assistance, post-hospitalisation assistance, assistance in organising return travel to the firm, continuation of travel, replacement on a business trip and the Concierge – personal assistant service.
Term deposits and structured products
As at 31 December 2013, the value of retail market deposits amounted to PLN 125.4 billion, in which retail and private banking deposits prevailed. The retail segment customers invest their funds mainly in term deposits. Their share in the segment’s deposits is still the largest in spite of an increase in the current deposits in the structure of deposits as a result of, amongst others, the decrease in interest rates and, consequently, term deposits becoming less attractive. The share of term deposits in the segment’s deposits amounted to 34.6% as at the end of 2013.
The Bank continued offering its customers, amongst others, deposits with progressive and standard interest rates (an Even and an Odd deposit, a 3M deposit, a 24M deposit) tailored to the current market situation. The offer comprised products tailored to various preferences of the customers and funds could be deposited for different periods.
Supplement of the Bank's standard offer addressed to retail customers are structured instruments sold in the form of structured deposits or Structured Bank Securities. The sales of such products are growing in terms of value from year to year. In 2013, the Bank launched active sales of 18 new structured products based on, amongst others, a basket of company shares, currency exchange rates and stock exchange indices.
In 2013, the first long-term saving product was included in the Bank’s product offer, namely the PKO Pierwszy Kapitał deposit, which was very well received by customers. This product is addressed to the parents of children aged 0 to 12 years. The long 12-year term of the agreement, the possibility of choosing from among five saving programmes, and an attractive interest rate give parents a guarantee of financial security for their children. By the end of 2013, 76.5 thousand deposits had been made.
Reatil segment deposit structure as at 31.12.2013
SKO’s offer
In 2013, the Bank continued developing the school-operated savings account programme (Szkolna Kasa Oszczędności – SKO). As at the end of 2013, more than 4.5 thousand schools participated in this Programme (every third primary school in Poland), and over 150 thousand children were learning how to manage their finances on the SKO online banking service.
Other investment products
In 2013, PKO Bank Polski SA was systematically developing its investment fund offer. Apart from the fixed offer which comprises over 20 open investment subfunds, the Bank was also distributing 4 closed-end investment funds. By expanding its offer the Bank gave its customers access to new investment strategies.
The Bank also offered its retail segment customers State Treasury bonds with both fixed and variable interest rates. In 2013, over 29 million bonds were sold, including nearly 9 million of highly popular short-term bonds (KOS1214).
Banking cards
As at the end of 2013 a number of banking cards of PKO Bank Polski SA was on the level of 7.1 million.
In 2013 another new functions were made available to holders of credit and debit cards. A new service which enables making a transfer from a credit card PKO Bank Polski SA’s account was introduced. With the new service it is possible to i.a. pay bills and make money transfers to bank account. There were also introduced changes in the prestigious products, i.a. allowing for exemption from the annual card fee when transactions for specific value are concluded.
In order to make its offer more attractive, the Bank introduced debit cards for foreign currency accounts and a Clear PKO Visa Credit Card.
Foreign currency cards are addressed to holders of accounts in USD, EUR or GBP and are equipped with a function which is unique on the market, making it possible to conduct transactions in accounts maintained in different currencies using a single card. By using such cards the Bank’s customers may, without any additional currency conversions, make payments abroad, withdraw cash from ATMs and pay in foreign currencies for online transactions.
Apart from the functionalities available so far, the Clear Card Holder may manage it via the iPKO electronic banking platform and the telephone service. The card carries a package of free text messages thanks to which the customer is informed on a current basis of, amongst others, a card being dispatched, cancelled, a transaction being made, the balance of available funds, payment due date, default or service fee due date.
Number of banking cards (in thousand of units)
Mobile banking IKO
In 2013, the Bank set a new standard for mobile payments by implementing the proprietary IKO application which enables making payments by using the phone. It is a mobile banking service – combining in one application banking functions (checking account balances and history, transfers) with payment functions (paying for purchases in traditional stores and on-line, ATM withdrawals, transfers to the phone number, generating checks for off-line use). The system is based on free of charge IKO application installed on the user's mobile phone and transactions are authorised by one-off codes generated.
In the second half of 2013, the IKO application was made available to Inteligo customers, persons who do not have an account with PKO Bank Polski S.A. based on the IKO wallet – a special application for persons who are not the Bank’s customers, as well as corporate customers who are sole traders or freelancers. The latter may combine the IKO with their corporate accounts.
After implementing the IKO application the Bank took measures to develop a network of online stores and points of sale accepting IKO payments. As at the end of December 2013, there were approx. 65 thousand terminals accepting IKO payments, and the number of active IKO applications was more than 100 thousand.
In the second half of 2013, the Bank took measures to establish a company called Polski Standard Płatności (Polish Payment Standard). Apart from PKO Bank Polski S.A. the company’s shareholders are: Alior Bank, Bank Millennium, Bank Zachodni WBK, ING Bank Śląski and mBank. Polski Standard Płatności will be supporting the development, promotion and popularisation of the mobile payment standard. In the newly-created system, transactions will be authorised using one-off passwords presented by means of a mobile application installed on the user’s telephone. Thanks to the participation of as many as six banks in this project Poland has joined the elite group of countries which have the chance to build a local mobile payment standard. Thanks to the implementation of Polski Standard Płatności customers will have easy access to telephone payments within a broad acceptance network. The system users will be able to pay by telephone both in traditional and online stores, use ATMs and transfer funds to the called party’s telephone number irrespective of which bank they have an account with.
iPKO transaction service
At the end of 2013, ca. 6.1 million retail segment clients had access to electronic banking. In 2013, the possibility to activate mobile application IKO under the iPKO service has been implemented. In addition, to increase the attractiveness of the iPKO transaction service, the Bank introduced changes to the product offer and implemented new functionalities. The Bank released one of the world's first online banking services for children under age of 13 – PKO Junior, tailored to the age of target audience. All functionalities of PKO Junior are linked to the Parent Application in the iPKO internet banking service, through which the parent has a full view of the PKO Konto Dziecka account and accepts operations initiated by the child.
Number of customers with iPKO access (in thousand of units)
Moreover, as part of the new functionalities the Bank enabled its customers to make deposits on terms negotiated via an outdealing platform – iPKOdealer. On the iPKO service platform, credit card and charge card holders were given the possibility, amongst others, of activating their card, changing the correspondence address, cancelling their card, ordering a new card, changing their PIN and paying off debt without an authorisation code. As part of the loan offer for small- and medium-sized enterprises, a new iPKO functionality was implemented, relating to the borrower’s passive access to credit accounts, which makes it possible to obtain information about the disbursed loan balance/the outstanding balance.