Credit policy

The Group updated its credit policy as a result of periodic review of credit process, including for compliance with external regulations and the necessity to update credit risk parameters. Following introduction of Recommendation U regarding good bancassurance practices, additional review of credit policy and internal documentation in relation to credit risk, for their compliance with the Recommendation was performed.

Retail clients

Key changes regarding retail client portfolio:

  • Verification of the method to determine minimum household maintenance costs assumed when calculating creditworthiness;
  • Verification of the policy of legal security of loans dedicated to retail clients, to include a more rigorous requirement to establish collateral for a selected high risk profile client group;
  • Change of the value of risk parameter for quality assessment included when determining creditworthiness of retail clients applying for non-mortgaged credit exposure.

A periodic update of other risk parameters as well as financial and legal documents required to calculate creditworthiness was carried out on a regular basis.

Institutional clients

With regard to the institutional loan portfolio, the Group commenced a series of initiatives aimed at improvement of the loan granting process efficiency and methods of credit risk management in the Microenterprise segment and of selected SME clients. Following a review of the loan granting process and portfolio analysis, the Group changed the credit risk evaluation methodology for clients with simplified accounting systems. The measures were to unify credit risk evaluation principles and optimize loan granting process.

Debt collection

With regard to debt collection, in 2014 the Group implemented applications supporting the process of recovering receivables. Further, with regard to pre-collection, agreements were concluded with collecting agencies on collection of overdue receivables. Commencement of cooperation with the external firms is aimed at optimizing of the pre-collection process and reduction of outstanding receivables.

The Group sold two packages of credit receivables. They were purchased mostly by securitization funds that offered the best prices during tender proceedings. As a result of these transactions, the Bank sold credit receivables with the nominal principal value of PLN 13.6 million and PLN 8.1 million of interest and other expenses. Following two sales transactions, the Bank reduced the impairment loss (on-balance sheet) on these assets by PLN 12.4 million and arrived at the total of PLN 1.9 million.

Annual Report 2014 - Bank Pocztowy