Polish banks have focused too much on the local market and have failed to take advantage of the foreign expansion of Polish companies, according to Bank Pekao Vice Chairman Jerzy Kwiecinski.
“The problem is that [the Polish banking sector] is heavily concentrated on the local market. They don’t do business outside Poland. […] A lot of this asset building is escaping us. Banks from Poland have not taken advantage of the fact that Polish companies have been going abroad,” Kwiecinski said during the Banking & Insurance Forum 2023 in Warsaw.
In his view, the Polish banking sector’s role in financing the economy is too weak.
“The Polish banking sector has too little capital in relation to the strength of the economy, as well as to the challenges it faces. The ratio of bank assets to GDP is falling, while it should be the other way around. And it is still 2-3 times lower than in developed economies,” the vice president stated.
He acknowledged that the sector’s profitability has risen to more than 10% in recent quarters, and if it were not for one-time factors such as the problem of franking credits it would be more than 20%.
“However, the problem is to maintain high profitability for a longer period of time,” Kwiecinski pointed out.
Source: Pekao and ISBnews
