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Poland – Bank BPH
€ m 2005 2004
Total assets 14,995 12,708
Net income before taxes 321.5 216.6
ROE before taxes 21.0 % 17.6 %
Cost/income ratio 49 % 56 %
Employees (full-time equiv.) 10,181 9,728
Offices 503 466
In 2005, the Polish economy grew
by an estimated 3.2 %. This compares
with a growth rate of
5.3 % in 2004, the year the
Warszawa
country joined the European
Union. The main reason for the
economic slowdown was the
slump in investments in the
first quarter of 2005, a statisti-
Kraków
cal effect following strong
investment activity in 2004. Later
in the year, however, investments
recovered, as did GDP growth. The increase in corporate loans,
though accelerating in the second half of 2005, remained low
as companies used internally generated funds to finance their
investments. In December, the inflation rate fell to a record
low of 0.7 % year-on-year despite high oil prices. Export
growth remained impressive, reducing the current account
deficit to a level significantly below 2 % of GDP. The increase
in personal loans was driven by housing loans and exceeded
the high rate seen in the previous year. Credit demand benefited
from a favourable interest rate environment and from
accelerating growth of real wages. Nevertheless, private
households also displayed a moderately higher propensity to
save, reflected in an increase in their holdings of financial
assets.
We are Poland’s third-largest bank, holding a market share of
10 % by total assets. Bank BPH is listed on the Warsaw Stock
Exchange and the London Stock Exchange. We are one of the
most innovative and dynamic banks in the country, offering a
comprehensive range of financial services and solutions
tailored to meet the growing needs of private individuals, businesses
and institutional customers in the private and public
sectors. Bank BPH is among the most active participants in
interbank business and in money and capital markets. The
international financial magazine “The Banker” named Bank
BPH “Bank of the Year in Poland” in 2005.
In addition to our country-wide network of about 500 branches,
our services are provided through a fast-growing franchised
distribution network comprising about 375 “partner outlets”.
80 CEE Network of Bank Austria Creditanstalt in 2005
Bank BPH’s results for 2005 were the best in its history: at PLN
1,294 m, its consolidated pre-tax profit exceeded the previous
year’s strong performance by more than 30 %. The improvement
in profits resulted especially from a determined expansion
of business in all market segments, overall economic
growth and opportunities arising from EU accession.
Supported by a significant increase in net interest income and
in net fee and commission income, revenues from banking
operations rose to PLN 3,090 m. The provisioning charge was
slightly reduced in spite of growing business volumes, which is
evidence of the high quality of results.
www.bph.pl
Despite the drive to expand the branch network,
general administrative expenses in national currency
remained at the previous year’s level. The cost/income ratio
thus fell considerably, to 49.4 %. Asset quality improved mainly
as a result of selective credit expansion and efficient risk management.
Success in the heart of Europe
As a member of an international banking network, Bank BPH
is actively contributing to the integration of Polish companies
in EU structures. We offer innovative products and services to
help companies enter markets in and outside Europe.
We conduct training and seminars for companies and municipal
authorities to provide them with information. In addition, we
have developed services enabling companies to efficiently use
EU financial assistance programmes. For example, with the
Euro Express Credit, we are market leader in Poland in the
area of EU-assisted financing for small and medium-sized businesses.
In 2005, Bank BPH in cooperation with HVB Group introduced
a cross-border cash pooling service in euro. This is an innovative
solution on the Polish market, enabling international
groups of companies to manage funds effectively.
Business structure and development
Retail customers
In the past financial year we further strengthened our position
in the retail banking market, with impressive loan growth of
28 % exceeding the market average and an over 11%
increase in the deposit base. Record sales of mortgage loans
resulted in 40 % growth of the portfolio in the private customer
segment to a total of PLN 9.7 bn, giving the bank a
market share of 19.2 % in this area. Credit card business also
continued to make very good progress in 2005, benefiting
from the wide range of co-branded and affinity cards and
from intensive cross selling.