Notes to the consolidated financial statements
6. Segment reporting
As intended by IFRS 8, financial information on segments is reported on the same basis as is used internally in reports presented to the Management Board of the Bank for the purpose to allocate resources to segments and evaluate their performance.
Segments are identified based on the method of carrying out activities and the type and scope of information used by management. This classification is consistent with the sales management and construction of the full offer for Group's clients.
The Group’s operations have been divided into segments in accordance with products sold, services provided and types of clients, for management purposes. The following operating segments have been identified: consumer, institution and settlement and treasury departments.
Detailed principles of calculating revenue, expenses, assets and liabilities in each segment are described in internal regulations of the Bank. The performance, assets and liabilities of the consumer and institutional segment include interest income and balance sheet items of the treasury area, respectively.
The operations are focused on the Polish market – the client base is composed mainly of Polish individuals and corporations.
Consumer segment of the Group
From management accounting perspective the consumer segment offers products targeted at individuals. The offer consists of saving and settlement accounts, savings accounts, term deposits, consumer loans (including cash loans and overdrafts), mortgage loans (including housing loans, mortgage loans and consolidation loans), insurance products and investment funds. It is sold through traditional distribution channels in a country-wide network of branches and sales points (including the sales network of Poczta Polska and financial agents), Pocztowy24 Internet banking, PocztowySMS mobile banking and a Call Center.
Institutional segment of the Group
Institutional segment in management accounting includes operating profit/loss from services provided to business entities with legal personality, individuals and entities with no legal personality carrying out business activities under applicable regulations and central and local administration entities.
Loan products (overdraft facilities and revolving loans, working capital loans, investment loans, with thermal improvement and refurbishment premium, as well as mortgage loans), deposits (current accounts, standards and individually negotiated deposits, savings accounts) and settlement services have been extended with a product offered at attractive prices and aimed at facilitating cash management in enterprises. Cash management products are offered through Regional Sales Branches, the network of Poczta Polska and financial agents.
Settlement and treasury segment of the Group
The settlement and treasury segment as determined for management purposes includes performance on settlement services and on treasury operations with regard to non-interest income. The Group offers comprehensive settlement services of unique quality, based on access to Poczta Polska's infrastructure. Key settlement services include payments to Social Security Office, to tax offices, as well and cash payments under interbank settlements. Further, the settlement product offer includes cash payments to third parties available in the network of Poczta Polska and in the Bank’s own network, cash payments to accounts in the network of Poczta Polska and in the Bank’s own network, mass domestic and international non-cash payment orders in PLN and payments made by clients in ADM’s.
Operations of the treasury function include treasury transactions, financial markets, management of liquidity, interest rate and currency risks. It trades on the interbank market, deposits surplus funds in market instruments or obtains funds for the Group, carries out derivative transactions (FRA, IRS and swaps) to hedge risk exposures. It repurchases client funds obtained by operating segments at a transfer rate and sells them funds to finance their credit operations.
Unallocated items, adjustments and exclusions
Unallocated items, adjustments and exclusions include revenue and expenses not classified in the above segments, as well as income tax.
Segment reporting
No material changes occurred in operational segment reporting compared to 31 December 2012.
Period from 1 January 2013 to 31 December 2013 | Consumer segment |
Institution segment |
Settlement and treasury |
Unallocated items |
Adjustments and eliminations |
Total |
---|---|---|---|---|---|---|
PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | |
Net interest income | 204,572 | 38,451 | 0 | 784 | 0 | 243,807 |
- sale to external clients | 181,967 | 30,011 | 0 | 784 | 31,045 | 243,807 |
- sale to other segments | 22,605 | 8,440 | 0 | 0 | (31,045) | 0 |
Net fee and commission income | 6,280 | 10,258 | 21,900 | 3,190 | 0 | 41,628 |
Other operating revenue and expenses related to banking operations *) | 0 | 0 | 8,885 | 0 | 0 | 8,885 |
Operating profit | 210,852 | 48,709 | 30,785 | (3,974) | 0 | 294,320 |
Other operating revenue and expense | 4,420 | 783 | 103 | (1,230) | 0 | 4,076 |
General administrative expenses, including | (164,229) | (34,636) | (10,079) | (3,794) | 0 | (212,738) |
- amortization | (17,069) | (3,665) | (677) | (528) | 0 | (21,939) |
Profit/loss on impairment allowances | (32,119) | (10,279) | 0 | 0 | 0 | (42,398) |
Operating prof it/loss | 18,924 | 4,577 | 20,809 | (1,050) | 0 | 43,260 |
Gross profit (loss) | 18,924 | 4,577 | 20,809 | (1,050) | 0 | 43,260 |
Income tax | 0 | 0 | 0 | (7,233) | 0 | (7,233) |
Net profit (loss) | 18,924 | 4,577 | 20,809 | (8,283) | 0 | 36,027 |
*) Gain/loss on financial instruments measured at fair value through profit or loss and realized gain/loss on transactions on securities
available for sale.
Period from 1 January 2012 to 31 December 2012 (restated) |
Consumer segment |
Institution segment |
Settlement and treasury |
Unallocated items |
Adjustments and eliminations |
Total |
---|---|---|---|---|---|---|
PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | |
Net interest income | 179,275 | 47,443 | 0 | 564 | 0 | 227,282 |
- sale to external clients | 158,246 | 32,226 | 0 | 564 | 36,246 | 227,282 |
- sale to other segments | 21,029 | 15,217 | 0 | 0 | (36,246) | 0 |
Net fee and commission income | 450 | 14,684 | 26,356 | 1,574 | 0 | 43,064 |
Other operating revenue and expenses related to banking operations *) | 0 | 0 | 19,909 | 0 | 0 | 19,909 |
Operating profit | 179,725 | 62,127 | 46,265 | 2,138 | 0 | 290,255 |
Other operating revenue and expense | 3,842 | (826) | 113 | (1,264) | 0 | 1,865 |
General administrative expenses, including | (158,259) | (41,763) | (15,342) | (2,992) | 0 | (218,356) |
- amortization | (15,562) | (3,978) | (847) | (570) | 0 | (20,957) |
Profit/loss on impairment allowances | (20,424) | (4,675) | 0 | 0 | 0 | (25,099) |
Operating prof it/loss | 4,884 | 14,863 | 31,036 | (2,118) | 0 | 48,665 |
Gross profit (loss) | 4,884 | 14,863 | 31,036 | (2,118) | 0 | 48,665 |
Income tax | 0 | 0 | 0 | (9,716) | 0 | (9,716) |
Net profit (loss) | 4,884 | 14,863 | 31,036 | (11,834) | 0 | 38,949 |
*) Gain/loss on financial instruments measured at fair value through profit or loss and realized gain/loss on transactions on securities
available for sale.
Segment assets include items directly allocated to the segment, such as net credit facilities and loans granted to the Bank’s clients, and the following items allocated to the segment for management accounting purposes: cash and other assets deposited in the Central Bank, receivables from other banks, investment financial assets, investments in subsidiaries, property, plant and equipment and intangible assets, deferred income tax assets and other assets.
Segment liabilities include directly allocated liabilities to clients, to the Central Bank and other banks and the following items allocated to the segment for management accounting purposes : liabilities held for trading, provisions, current income tax liabilities, other liabilities, subordinated liabilities, liabilities due to issue of debt securities and total equity.
Balance as at 31 December 2013 | Consumer segment |
Institution segment |
Settlement and treasury |
Unallocated items |
Adjustments and eliminations |
Total |
---|---|---|---|---|---|---|
PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | |
Segment assets | 5,746,206 | 1,646,579 | 0 | (10,040) | 0 | 7,382,745 |
Segment liabilities | 4,899,040 | 2,493,745 | 0 | (10,040) | 36,246 | 7,382,745 |
Balance as at 31 December 2012 (restated) |
Consumer segment |
Institution segment |
Settlement and treasury |
Unallocated items |
Adjustments and eliminations |
Total |
PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | PLN ‘000 | |
Segment assets | 5,285,150 | 1,843,257 | 0 | (7,754) | 0 | 7,120,653 |
Segment liabilities | 4,552,916 | 2,575,491 | 0 | (7,754) | 0 | 7,120,653 |
In 2013, revenue generated by the key counterparty of the Group amounted to PLN 22.8 million compared to PLN 29.7 million in 2012.
Annual Report 2013 - Bank Pocztowy
Corporate Governance
- Corporate governance: principles and scope of application
- Control system in the process of preparing financial statements
- Entity authorized to audit financial statements
- Shareholding structure and share capital
- Key information regarding Poczta Polska S.A.
- Cooperation with Poczta Polska S.A.
- Investor relations
- By-laws amending principles
- Activities of the corporate bodies of the Bank