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4 | EUROPEAN FINANCIAL CONGRESS

EUROPEAN FINANCIAL CONGRESS | 1

European Financial Congress: a financial think-tank active all year round

The central theme of the 5th European Financial Congress, held under the patronage of Donald

Tusk, President of the European Council, was the integration of Europe in the face of a security

crisis. The Congress served once again as a forum for debate about the key problems of the Euro-

pean and Polish economies. During the three-day event, nearly 1,500 representatives of business,

science and politics got together to discuss the security and stability of the European Union.

The significance of the Congress and its deliverables are manifested not only through diagnoses

of the most pressing problems, but also proposals for practical solutions to them put together

in the form of Recommendations of the European Financial Congress. “Because of its Recom-

mendations, the European Financial Congress is active all year round and has become a financial

think-tank in its own right. Congress’s experts contribute to formulating Poland’s stance on is-

sues of key importance for our country relating to the financial, capital or energy markets,” said

Jan Krzysztof Bielecki, Chairman of the Programme Board of the European Financial Congress,

opening this year’s edition of the Congress. Recommendations worked out by the EFC are sub-

sequently presented to various expert bodies and public institutions. EFC experts have recently

prepared contributions to consultations held by the Financial Stability Board focusing on limiting

threats arising from the existence of banks which are “too big to fail”, as well as to consultations

held by the European Commission regarding gas supply security in the European Union and the

concept of a European Capital Markets Union.

The President of the National Bank of Poland, Marek Belka, devoted his lecture inaugurating the

Congress to selected causes of crises on financial markets. “Sometimes crises are not caused by

errors, mistakes or short-sightedness, but by temptation and an improper structure of incentives.

These are the crises which we can and should eliminate, or at least limit,” stressed Marek Belka.


The inaugural session of the 5th European Financial Congress was then dominated by the issue

of the common currency. The fact that the Congress’s inaugural topic coincided with issues

addressed by the extraordinary eurozone summit seeking to solve the zone’s most urgent

problems, which took place on the same day, proves that the Sopot-based Congress accurately

identifies the most important challenges faced by Europe and Poland. During the opening ses-

sion, the advantages and disadvantages of the common currency and the ways of repairing

the eurozone were addressed by the Minister of Finance Mateusz Szczurek, HSH Prince Michael

von Liechtenstein and Jacek Rostowski.

Jan Krzysztof Bielecki stressed that the European Financial Congress was an event which did

not draw a distinction between speakers and the audience. The record of the European Finan-

cial Congress represents the sum of experiences and visions of the experts, entrepreneurs,

scientists and politicians who attend it. To allow these different voices to be heard, this year’s

Congress featured for the first time Oxford-Style debates, i.e. an exchange of arguments be-

tween those for and against certain theses, with audience participation.

The first Oxford-Style debate focusing on the proposition “It is worth being part of the euro-

zone” took place during the inaugural session of the Congress. Arguing for and against this

thesis were MEPs Dariusz Rosati and Zdzisław Krasnodębski, representatives of the scientific

community Dariusz Filar and Andrzej Sławiński, and Jerzy Pruski and Stefan Kawalec repre-

senting the financial sector.

The second part of the opening day of the European Financial Congress was filled with debates

on the Energy Union and the Capital Markets Union.

The debate on the challenges faced by the energy market was hosted by Joschka Fischer, Ger-

man Vice Chancellor between 1998 and 2005. The discussion was opened by Janusz Lewan-

dowski, President of the Polish Prime Minister’s Economic Council: “We have won a battle

of words: slogans such as diversification of supplies, energy efficiency, liquid energy mar-

ket or interconnectors no longer raise eyebrows. Now it is time to act,” encouraged Janusz

Lewandowski. “The fundamental question the Union has to ask itself is whether we will do this

together or separately. I strongly believe we should be speaking with one voice. In the face

of global changes and geopolitical challenges, an energy union is the only solution to ensure

Europe’s security and competitiveness,” summed up Joschka Fischer.

The debate on capital market integration was led by Nicolas Véron, Senior Fellow at Bruegel,

a Brussels think-tank which this year joined the ranks of co-organisers of the European

Financial Congress. In his speech, Nicolas Véron stressed that the concept of the Capital


Markets Union is an exceptionally advantageous solution, as it does not

suggest a compromise between growth and stability. It creates better op-

portunities for access to sources of financing for enterprises, while enhanc-

ing stability by improving the economy’s shock absorption capacity. “Many

people speak about the need for fiscal integration, but it is the integra-

tion of financial markets that can ensure greater resilience of the European

economy,” he added.

IN SEARCH FOR VIABLE SOLUTIONS

The central theme of this year’s edition of the European Financial Congress

– European integration in the face of the security crisis, already highlighted

during the inaugural session – was further explored during industry-specific

discussions which filled the agenda of the second and third day of the EFC.

Great expectations and interest are always aroused by debates which de-

liver practical solutions capable of bringing down barriers to development.

The most important solutions worked out by the participants of nearly

40 debates were formulated as Recommendations announced at the close

of the European Financial Congress.

The publicly available Recommendations have for five years formulated

non-lobbying proposals for all decision-makers who influence the realities of economic and

political life. Professor Leszek Pawłowicz gave examples of solutions which were initiated

thanks to the EFC’s Recommendations, such as the development of the covered bonds market

or the formulation of the position on membership of countries from outside the eurozone

in the Banking Union and on the resolution of banks.

This year’s Recommendations primarily concern trends and phenomena directly related to

deeper European integration in the face of the ongoing security crisis. The position of the EFC

Academy has also found its way into the Recommendations – young people want to change

Poland into a paradise for talent from all over the world and are proposing ways to do this.

The voice of the young generation was exceptionally well heard this year in Sopot. One of the

most lively events of the three-day Congress was an Oxford-Style debate devoted to the issue

of opening the doors to immigrants as a chance to overcome the demographic problems faced

by the European Union. The debate “Without immigrants Europe is doomed to fail” saw a clash

of arguments put forward by the proponents and opponents of this proposition, including

Polish students from Oxford and Cambridge.

”The European Financial Congress has been participating in major debates throughout the year. (...) We were involved in public consultations with the European Commission on gas supply security at the European Union level, preparing our position with the support of EFC’s collaborating experts. Our position follows on from the debates and recommendations of last year’s Congress.“

Jan Krzysztof BieleckiChairman of the European Financial Congress Programme Board


The closing ceremony of the 5th European Financial Congress was also an occasion for stress-

ing the importance of wise management of urban space. The Environment Minister Maciej

Grabowski presented awards to the winners of the “Design: Eco-Exterior” contest organised by

the Ministry of Environment. “We want to recognise and promote real estate projects which

are environment-, people- and climate-friendly,” said Maciej Grabowski. Professor Leszek

Pawłowicz and Jacek Karnowski, President of the City of Sopot, also presented an award to the

winner of the contest held by the City of Sopot, for the best project involving the regeneration

of the Morskie Oko grounds in Sopot. A day after the Congress members of the EFC Academy

met with Lech Wałęsa in the European Solidarity Centre.

“The Congress is coming to an end, but it never falls asleep,” stressed Jan Krzysztof Bielecki,

Chairman of the Programme Board of the European Financial Congress, during the official

closing ceremony of the event in Sopot. After all, the EFC’s Recommendations – worked out

over the course of numerous debates and meetings organised throughout the year between

the Sopot Congresses – are “alive” all year round.

It is our pleasure to invite you to the 6th European Financial Congress which will be held in

Sopot, Poland, on June 13-15, 2016, as well as to join other events and initiatives carried out

within the European Financial Congress Project.


Donald Tusk

President of the European Council

Lech Wałęsa

President of Poland in 1990-1995

Tadeusz Gocłowski

Archbishop Emeritus of Gdańsk

Jan Krzysztof Bielecki

Prime Minister of Poland in 1991

Jan Szomburg

President of the Management Board,Gdańsk Institute for Market Economics

Janusz Lewandowski

Member of the European Parliament , President of the Economic Council

to the Polish Prime Minister

Honorary Committee

Honorary Patronage of European Financial Congress 2015


Mirosław KachniewskiPresident of the Polish Association of Listed Companies

Dariusz KacprzykPresident of the Management Board, Bank Gospodarstwa Krajowego

Programme Board

Beata Binek President of the Management Board, Polish Institute of Directors

Olgierd DziekońskiSecretary of State, Chancellery of the President of the Republic of Poland

Michał ChyczewskiPermanent Representative of the Republic of Poland to the World Trade Organization

Jerzy GajewskiPresident of the Management Board, NDI S.A.

Maciej H. Grabowski Minister of the Environment of Poland

Zbigniew JagiełłoPresident of the Management Board, PKO Bank Polski

Andrzej JakubiakChairman of the Polish Financial Supervision Authority

Jan Krzysztof Bielecki Chairman of the European Financial Congress Programme Board


Jacek KarnowskiPresident of Sopot

Stefan KawalecPresident of the Management Board, Capital Strategy

Waldemar MarkiewiczPresident of the Polish Chamber of Brokerage Houses

Andrzej KopyrskiVice-President of the Management Board, Bank Pekao S.A.

Iwona KozeraPartner, Financial Services Industry Leader for Central and Southeastern Europe, EY

Jacek Krawiec President of the Management Board, PKN ORLEN S.A.

Jarosław Kroc President of the Management Board, Accenture

Stacy LigasPartner, KPMG

Andrzej MalinowskiPresident of Pracodawcy RP

Mateusz Morawiecki President of the Management Board, Bank Zachodni WBK


Andrzej ReichDirector of the Banking, Payment Institutionsand Credit Unions Regulations Department, Polish Financial Supervision Authority

Marek Rosiński Managing Partner, Baker & McKenzie Krzyżowski i Wspólnicy

Andrzej SławińskiDirector of the Economic Institute, National Bank of Poland

Iwona SrokaPresident & CEO of KDPW and KDPW_CCP

Jacek Rostowski f. Deputy Prime Minister and Minister of Finance of Poland 2007-2013

Wojciech PaprockiProfessor, Warsaw School of Economics

Jacek SochaPartner and Deputy Chairman of PwC in Poland

Grzegorz PiwowarVice-President of the Management Board, Bank Pekao S.A.

Jerzy PruskiPresident of the Management Board, Bank Guarantee Fund

Leszek PawłowiczDirector, Gdańsk Academy of Banking


Andrzej SuszyckiHead of Representation in Poland, Joschka Fischer & Company

Beata StelmachCEO, GE in Poland and Baltics

Dariusz SzkaradekPartner, Deloitte, Financial Institutions Sector

Herbert WirthPresident of the Management Board, KGHM Polska Miedź S.A.

Marek WoszczykPresident of the Management Board, PGE Polska Grupa Energetyczna S.A.

Jadwiga Sztabińska Chief Editor, Dziennik Gazeta Prawna

Andrzej TersaPresident of the Management Board, ENERGA S.A.

Paweł TamborskiPresident of the Management Board, Warsaw Stock Exchange


RECOMMENDATIONS

OF THE EUROPEAN

FINANCIAL CONGRESS


Ending Too Big to Failproposal of the Polish position in the Financial Stability Board’s consultations

Poland should actively participate in developing solutions to introduce inter-

national standards regarding the total loss absorbency capacity (TLAC)

of the world’s largest cross-border banks. The purpose of TLAC is to guaran-

tee those banks are able to absorb unexpected losses without consequences

for the stability of the financial system and without involving public funds.

The Financial Stability Board (FSB) prepared a consultation document in this

respect for the G-20 that set forth additional prudential requirements for the

30 largest global systemically important banks (G-SIBs). Poland is not

a member of the G-20 and is not represented in the FSB, but the solutions

put forward in the consultation document may be relevant for the banks

that operate on the Polish financial market and are at the same time sub-

sidiaries of banks included in the G-SIB group, and may consequently be

significant for the stability of the entire Polish financial system.

In his letter to the leaders gathered at the G20 summit, FSB Chairman Mark

Carney used the expression “ending too big to fail”. This is an important

and most frequently raised aspect of moral hazard in the banking industry.

Without questioning the importance of the “too big to fail” phenomenon,

we should additionally resolve at least two systemic issues that undermine

the credibility of financial markets and facilitate moral hazard:

the fact that credit rating agencies are paid by issuers;

the fact that auditors are paid by those audited.

FSB recommendations should therefore be supplemented in the following

manner:

credit rating agencies should no longer by remunerated by issuers;

auditors should no longer receive compensation from businesses audited.

The European Financial Congress prepared the Polish experts’ position1 on the consultation

document drawn up by the FSB concerning additional prudential requirements for G-SIBs

(referred to as the TLAC proposals), and presented it during the public debate held by the FSB.

”One way of dealing with the threats stemming from the financial system is to raise capital requirements – for everyone, and especially for institutions that are systemically important. Having capital requirements which are too low is certainly partly the fault of those responsible for supervision. That mistake is slowly being corrected.(…) But it’s not only the amount of capital that counts, it’s also quality, perhaps above all quality. Various types of hybrid capital are like an airbag which always works except when there’s an accident. When losses are big, it turns out the capital doesn’t provide effective coverage.“

Marek BelkaPresident of the National Bank of Poland

1 The complete position of the European Financial Congress submitted to the Financial Stability Board along with the description of the underlying methodology is available on the EFC website: http://www.efcongress.com/sites/default/files/analizy/efc_position_on_the_fsbs_tlac_proposal_0.pdf


THE ESSENCE OF TLAC AND THE POSITION OF THE EUROPEAN FINAN-

CIAL CONGRESS EXPERTS

Global consultations involved 59 participants including major global banks

and bank associations from, among others, the United Kingdom, Italy, Japan

and China, international institutions and professional associations (European

Banking Federation, Financial Markets Law Committee, Institute of Interna-

tional Bankers), international regulators and supervisors as well as individual

experts. In parallel with the global consultations initiated by the FSB, a Eu-

ropean debate on MREL (minimum requirement for own funds and eligible

liabilities) took place, conducted by the European Banking Authority. It con-

cluded with the adoption by the EBA of draft regulatory technical standards

setting the MREL level. In line with the EBA’s announcement, owing to the

considerable flexibility afforded to national authorities, European MREL regu-

lations, which concern all banks (and not just G-SIBs), will not conflict with

TLAC standards, and will in fact be complementary.

The essence of TLAC is the introduction of additional prudential requirements

for the 30 major banks deemed the most important in light of the systemic

risk they pose. These requirements are meant to increase the capability

of recapitalising these banks in the event of their resolution.

According to the proposal, the G-SIBs indicated by the FSB should, starting

from 1 January 2019 (or a later date depending on the results of the analyses

conducted under the Quantitative Impact Study), hold equity and debt instru-

ments amounting to at least 16 to 20 percent of their risk-weighted assets

that can be converted to equity or absorb losses in an emergency.

”The Resolution Fund is nowhere near big enough to deal with very large banks. The firm in resolution should have the right to access central bank funding on normal terms of facilities that would apply to another firm that is viable. If the institution has been recapitalized to a sufficiently high level and its loss-making activities are adequately dealt with in the restructuring, the hope would be that the market funding will eventually return.“

Peter BrierleyHead of Resolution Policy Division,Resolution Directorate,Bank of England

”Funding in the resolution is the key issue. If not only financial institutions but also people at large believe that resolution actions are credi-ble and consistent, we can develop the resolu-tion action without problems of liquidity. (…) Cross-border activities pose many challen-ges, e.g. require cooperation of authorities by exchange of information and recognition of resolution activities taken by one authority. In the eurozone there will be only one authority in the resolution.“

Antonio CarrascosaMember of the Board, Director of Resolution Planning and Decisions, Single Resolution Board


An additional requirement is that these funds be maintained at a level of at

least twice the leverage ratio, which is another tool for assessing the level

of the bank’s capitalisation irrespective of the level of financial risk. These

funds should ensure that the bank continues to perform its critical functions

during the process of its resolution and protect taxpayers from bearing the

costs of its bankruptcy by eliminating the need for bail-outs by either the

central bank or the government.

The position of the Polish experts associated with the European Financial

Congress concerns in particular those issues relevant to the stability of the

financial system in host countries. Part of this position is outlined below.

Polish experts stressed, inter alia, that in order to ensure the stability

of the local financial sector, it should also be possible (based on deci-

sions of domestic supervisors) to apply the loss absorbency capacity re-

quirement to banks systemically important at the domestic level (D-SIBs).

This should be done by introducing another group of banks and not

by simply extending the global bank (G-SIB) group because this group

will be much less homogeneous than the G-SIB one. Banks that would

be considered average in a large country may be deemed systemically

important in a smaller one.

In the opinion of Polish experts, the minimum TLAC requirement set

within the range of 16–20 percent of risk-weighted assets, and at a minimum of twice the

Basel III leverage requirement, appears adequate in the current environment. The require-

ments are not understated but may need simplification.

TLAC/MREL requirements should apply to banks at the individual level (to ensure the safety

of individual entities) as well as at the consolidated one (to prevent the transfer of risk to

subsidiaries or any limitations of their freedom to use capital and also to prevent the es-

tablishment of financial holding companies where the parent company is an unregulated

institution). A group should have at its disposal assets corresponding to the greater of the

two amounts: the amount calculated for the group or the sum of the amounts calculated

for individual banks and allocated at the level of those banks. The manner in which TLAC

is allocated should stem from the resolution strategy adopted, which in turn should result

from the structure of the group and the decisions of national resolution authorities from

”The prerequisite for a successful resolution is successful preparation, first of all, on the level of institution. We can only resolve an institution which is resolvable. You have to make sure you have indentified critical functions of the bank because those are the ones that need to be continued. That is a particular problem in the case of large cross-border institutions.“

Bernhard SpeyerSenior Advisor, Senator’s Office, Berlin Senate for Finance


the home and host countries.

Polish experts second the FSB proposal that the funds provided for under

TLAC should be allocated by the parent company among those systemic

subsidiaries that meet at least one of the risk or size criteria (more than

5 percent of the risk-weighted assets of the entire group, more than 5

percent of group income, more than 5 percent of the leverage measure

for the entire group, importance for the performance of critical business

functions). However, the host supervisor should also have the right to

decide on the inclusion of subsidiaries that do not meet these criteria but

are systemically important in the host country, in the TLAC requirement.

The method for distributing TLAC funds should be subject to supervisory

approval by a panel of home and host supervisors, as is the case when

applying advanced methods for the measurement of capital.

Will the introduction of TLAC heal the banks? In the view of European Fi-

nancial Congress experts, the TLAC project may mitigate the moral hazard

generated by G-SIBs, but will not eliminate it altogether.

”The root cause of the problems is hard to diagnose. Revising the business model of complex organisations can sometimes take years. Various ideas on risk mitigation, such as sale of bad assets or additional liquidity financing from ECB, may prove inadequate in allowing very large organisations to rapidly regain the market’s trust.“

Dariusz SzkaradekPartner, Financial Services Institutions Leader in Poland, Deloitte


Energy union as a tool supporting the renaissance of the European industry

The complicated situation of the European energy sector is the legacy of long years of ener-

gy being treated as an exclusive responsibility of individual states. This, in conjunction with

the climate policy pursued in parallel at the EU level, has created a regulatory knot that will

be difficult to untangle: community climate goals provide a framework for national energy

policies and thus automatically override them at the expense of energy prices in EU Member

States. At the same time, the current composition of the European energy sector still largely

reflects the divisions present before 2004, when a large group of post-communist countries

that had been dependent on the former Soviet Union for decades joined the EU.

The idea of the European Energy Union (EEU), which was put forward by

Poland and broken down by the European Commission into proposals

concerning specific goals and measures in February 2015, may make

the energy industry a motor of European integration and leverage this

strategic sector to boost the competitiveness of the European economy.

Contemporary EU energy and climate policy is among the most impor-

tant conditions for sustainable (long-term) development, but not its

driving force. Moreover, the persistent pursuit of ambitious climate pro-

tection goals whilst fully respecting stringent environmental standards

has ultimately resulted in the European economy losing its competitive-

ness and has become a threat to the sustainable development strategy

itself. It is difficult to talk about sustainable development in an economy

that has lagged behind its neighbours for many years.

WHAT SHOULD BE DONE TO RETURN THE EU ECONOMY TO THE PATH

OF SUSTAINABLE GROWTH?

European Financial Congress 2015 recommends the following measures:

1. Restoring the competitiveness of the European economy and bringing

about a renaissance of European industry must become priorities

for EU economic policy. However, this goal should not be pursued at

the expense of the remaining conditions for sustainable development,

i.e. energy security and respect for the natural environment and climate.

”The disputed issues include finding the right balance between the European Union’s climate agenda and energy agenda and the ex-ante compliance check, i.e. auditing the contracts being signed by individual countries before and not after their signing to eliminate the contracts that jeopardise security of supplies and breach EU solidarity.“

Janusz LewandowskiPresident of the Economic Council to the Polish Prime Minister


2. The idea for an energy union, as put forward by Poland and devel-

oped by the European Commission, is a project with major develop-

ment and integration potential and therefore it should be used as

the next vehicle (pillar) of European integration following the

Lisbon Treaty. It should therefore be boldly designed and carefully im-

plemented.

3. Ultimately, the core of the European Energy Union should be

a common energy system consisting of a single market, a single

regulator, a single offset mechanism and a single carbon price, and

equipped with mutual security guarantees in case of extreme external

disturbances.

A single energy system for the whole of Europe will be significantly

cheaper to create and operate than one consisting of interrelated and

cooperating national systems that overlap in installed capacity, compete

against one another in terms of the cost of energy produced, resort to

their own offset mechanisms and provide their own reserves in case

supplies are interrupted. The energy efficiency potential liberated by the

common integrated system, in the form of substantially lower costs of

producing and delivering the energy required by end users, will become

a major source of the competitive advantage that Europe so badly needs

at the moment.

”We need infrastructure but what we need much more is the common understanding to act together in a crisis and not to immediately cut off borders and act purely nationally. Moreover, solidarity is nice but we need to put a legal rule into place how to share gas in scarcity situation.“

Oliver KochDeputy Head of Unit, Wholesale Markets; electricity & gas, DG Energy, European Commission


4. Rational use of EU primary energy resources is an area with considerable

potential benefits for climate protection and the competitiveness of the

European economy. To this end, the European Union should introduce

uniform rules for the use of primary energy resources, both fossil

and renewable. The decarbonisation process is about effectively limiting

and eventually halting the emission of carbon dioxide into the atmos-

phere. In the long term, fossil fuels may also meet this criterion, provided

that they are not arbitrarily excluded from research and innovation pro-

grammes right now.

The current thinking is that by 2040, coal will still cover a quarter of global

energy demand. In the case of electricity, that figure will be 30%. Thus in

the aforementioned time horizon coal not only cannot be excluded from

the global energy mix, but its share will remain significant. Taking the

above into account, we should invest heavily in effective decarbonisation

in the field of coal use, as this is the most accessible primary source

of energy, while still looking for innovations in other areas. The largest

consumers of coal will be China and India. If innovative technologies for

coal utilisation are developed, these countries will use them, as is cur-

rently the case with renewable energy sources, and they will reduce car-

bon dioxide emissions at home, which will benefit the climate.

”The stone age did not end because there was scarcity of stones. It ended because there was a technological jump, a new technology was developed. We shouldn’t underestimate it in the energy strategy. (…) From the global perspective the only way which is important for Europe dealing with really XXL sizes like China, India, Brasil or the US, is moving together on the basis of compromise, also in the energy sector.“

Joschka FischerVice Chancellor of Germany in 1998-2005


5. An important issue is to shift from the current model of selec-

tive support for the development of technologies (wind – yes,

coal – no, nuclear – here but not there, etc.) towards techno-

logically neutral support. In the process of encouraging innovation,

the European Commission should become a leader who sets the goal

by identifying key development challenges and presents a vision for

the future European economy. One such vision is the energy integra-

tion of the European economy, and this is the direction in which the

European Energy Union is leading. The role of the European Commis-

sion is also to allocate adequate amounts from its budget, which will

be invested through national research programmes coordinated by

teams of independent experts in the search for the solutions that will

bring us the economy of the future.

6. At the very beginning of the European Energy Union project,

priority should be given to overcoming the concerns of Member

States for their own energy security through concrete actions

that reflect energy solidarity and build mutual trust. From the

perspective of Central and Eastern European countries, which are

paying higher prices for natural gas for the sole reason that they

remain dependent on a single supplier, this solidarity will manifest

itself in the willingness of other Member States to actively oppose

the price discrimination policy pursued by the eastern gas supplier.

From the perspective of Western European countries, a manifesta-

tion of energy solidarity will be the readiness to increase the limits

on cross-border trade in electricity.

7. An important factor in building mutual trust is recognising the

right of Member States to develop their own strategies for real-

ising the vision of European energy integration within the agreed

timeframe. An important argument in favour of this approach is the

current difference in emissions between the energy mixes in individ-

ual countries – with today’s technologies, these cannot be eliminated

without incurring significant social and economic costs such as the

loss of competitiveness or jobs. It is therefore important that in the

process of creating an integrated European energy sector, differences

in the costs of adjustment are taken into account and appropriately

addressed within the framework of offset mechanisms.

”The wholesale prices of energy in Europe are competitive compared to the US and other areas. The difference between wholesale prices and end-consumer prices is ten times. What end-consumers pay for is electricity, but on top of that they pay for distribution and transmission. And then there are taxes. Because we have to mitigate climate change, we have to boost renewables. The big question is: can we do it cheaper or not?“

Esa HyvärinenSenior Vice President, Corporate Relations, Fortum Corporation

”The EU climate policy has shifted strongly towards renewable energy sources, and decarbonisation is understood therein as the process of eliminating carbon and fossils from energy production in favour of other technologies. Still, it is not fossils but emissions that contribute to climate change. If we reject carbon today, turn our backs on oil and merely tolerate gas as ‘transitional fuel’, no investment will be made in technologies enabling further reduction of emissions from the burning of those raw materials.“

Jacek KrawiecPresident of the Management Board, PKN Orlen S.A.


8. Poland should be actively involved in the process of creating the energy union since

the alternative, i.e. allowing the process to follow its own course, would be not just

expensive but also dangerous for us. In our region of Europe, there is very little room for

independent action in a sector as globalised as energy. On its own, Poland – just as every

other country in Europe – cannot meet contemporary challenges and competition from

major economies such as the US and China as well as cannot overcome the Russian threat.

Poland, which is the initiator of the Energy Union, should not only support this project, but

first and foremost play an active role in it since we have a unique energy mix and thus face

unique problems that no one else will solve for us. Our problem within the European Union

is not that we have our own distinct views on the pace of decarbonisation, because this fol-

lows from the peculiarity of our energy mix that will take time to change – the problem is

that we do not put forward any long-term strategy of dealing with our Gordian (coal) knot.

9. Solutions for the decarbonisation of the Polish economy should be sought among new

technologies that allow cleaner coal use. To this end, we should urgently develop a long-

term strategic vision for the development of the Polish economy, which fits in with

the prospect of European energy integration that leverages the potential of the con-

tinent’s own natural resources, including the coal mined in our territory. This should

be followed by significant expenditure on research and innovation. Appropriately tar-

geted interdisciplinary research (in the basic, applied and implementation phases) should be

carried out by specialised centres that coordinate the collaboration between science and


industry. Coal and its innovative use are a major opportunity for Po-

land. They offer a chance to build an innovative economy and to use the

country’s coal resources, a way out of the energy deadlock in the inter-

national arena and also a way to stimulate the development of Silesia,

an important region of Europe and of Poland, for which there are no

constructive proposals today.

”Poland is trying to reach all the targets in terms of climate change, price affordability and security, but we must keep in mind that no energy union will succeed unless it is cost-effective. Only then will we be able to offer our customers the cheapest possible energy that would boost EU’s competitiveness.“

Marek WoszczykPresident of the Management Board, PGE Polska Grupa Energetyczna S.A.


Credibility through universality

We recommend that one of the main goals of the Capital Markets Union be to enhance the

credibility of capital markets by supporting the universal availability of ratings for issuers

of securities, in particular those from the small and medium-sized enterprise sector. Pos-

sibilities should be examined and measures undertaken in order to develop a business model

that eliminates the conflict of interest between those rated and those who rate them, which

is ingrained in the rating agency model where the assessing entity is paid by those subject

to its assessment.

JUSTIFICATION

The Capital Markets Union has been presented as one of the key projects

of the current European Commission led by President Jean-Claude Juncker.

As the main rationale for the measures aimed at the establishment of the

Capital Markets Union, the Commission cites the slowdown in economic

growth in the European Union, the persistently high unemployment and

a decline in investment levels. The Commission stresses that the main ob-

jective of the Capital Markets Union should be to stimulate sustainable

economic growth and an increase in employment, and as a consequence to

boost the innovativeness and competitiveness of the EU economy. Given

the prevailing loan-focused funding model, the Commission intends to

achieve this objective by enabling the efficient allocation of capital through

the development of non-loan forms of funding and investment in European

companies and infrastructure.

Experts from the European Financial Congress took part in international

consultations concerning the idea, objectives and prospects of the Capi-

tal Markets Union. The European Financial Congress developed its posi-

tion based on a survey involving around thirty capital market experts and

conducted in collaboration with the Committee on Financial Sciences

of the Polish Academy of Sciences.1

”Bank financing is quite good for catch-up growth. Start-up innovators need developed capital markets, they need funding that does not come only from the banking channel. Capital Markets Union’s agenda should find a right balance to serve these different needs.(…) Now you see a lot of lobbying by banks who say: We do not want competition from other channels of financing the real economy.“

Nicolas VéronSenior Fellow, Bruegel

1 The complete position of the European Financial Congress submitted to the European Commission together with the description of the underlying methodology is available on the EFC website http://www.efcongress.com/sites/default/files/analizy/position_of_the_efc_re_cmu.pdf


One of the main conclusions of the position developed was that further de-

velopment of capital markets would not be possible without restoring trust

in capital markets and enhancing their credibility. Experts suggested that

this credibility could be improved by e.g. promoting investment risk analy-

sis by independent analysts who would offer their services in particular to

small and medium-sized enterprises and to individual investors.

In the experts’ opinion, making independent issuer creditworthiness ratings

more widespread is:

particularly important for small and medium-sized enterprises, which are

unable to bear the costs of the audits carried out by the major rating

agencies;

of key importance for eliminating the conflicts of interest inherent in the

operation of major credit rating agencies where the rating entity is paid

by the rated one.

The absence of analytical centres that specialise in the small and me-

dium-sized enterprise segment significantly reduces the availability of

standardised information on the financial situation of these enterprises.

This results in heightened risk for investors. Individual and foreign in-

vestors are particularly discriminated against in these circumstances.

Moreover, the absence of widespread analyses and issuer ratings increases funding costs

for businesses, which adversely affects their ability to finance their operations using pub-

lic capital market instruments. The creation of local analytical centres that would

”The aim of establishing the Capital Markets Union is very noble. The question is how to achieve that objective in a market that is extremely diversified given that Europe differs greatly in terms of development of capital markets.“

Iwona SrokaPresident & CEO of KDPW and KDPW_CCP


specialise in assessing the financial position of small and medium-

sized enterprises would enhance market transparency and credibility,

reduce the risks for investors and bring down the cost of capital

for creditworthy issuers. Another positive effect for the capital market

would be a broadening of the investor base and improvement in market

liquidity.

The analytical centres in question should operate on a commercial basis.

Co-financing from European funds should only provide support and incen-

tives for establishing such institutions; those funds would not constitute

subsidies and would either be returnable subject to certain rules or would

amount to equity financing.

Measures to make issuer ratings more widespread should go hand in hand

with those aimed at stock market segmentation, consisting in reserving the

most transparent segments of the market exclusively for rated companies.

”The Capital Markets Union project assumes that securitization of loans to SMEs would improve funding of SMEs. The problem now in terms of loans growth is not the lack of credit supply but the lack of credit demand. Moreover, the crisis has taught us that securitization is procyclical and increases the interconnectedness within the banking system and capital markets.“

Christophe NijdamSecretary General, Finance Watch


More market in reference rates

The following recommendation follows up and expands on the EFC’s 2012

recommendation “More market in the banking sector” in so far as it deals

with restoring the credibility of the inter-bank market.

In the light of upcoming EU regulations concerning reference rates, we

recommend that EU Member States undertake a reform of the money

market’s reference rates, taking into account:

1. Modernisation of the current reference rates which serve as the basis

for valuation of a very large share of financial instruments;

2. The establishment of new reference rates for the money markets, which

would provide an alternative to those currently in use;

3. A system for monitoring the evolution of reference rates against trans-

actional market prices.

The experience of the Gdańsk Institute for Market Economics (IBnGR)

shows that:

taking actual transactional data into account when calculating refer-

ence rates lowers systemic risk on financial markets;

even if the volatility of market prices is greater than that of existing

indices, IBnGR has developed empirical methods to lower this volatil-

ity, in a transparent and tamper-free manner, to levels adequate for the

purposes of instruments which rely on reference rates;

”A key problem the European Union has tried to address, so far unsuccessfully, are the imbalances within the eurozone, imbalances across Europe. This is not merely about the European Union’s competitiveness against the rest of the world but also about the competitiveness of individual countries against one another. Redefining that competitiveness without an exchange rate channel with a virtually zero inflation rate is very challenging.“

Mateusz SzczurekMinister of Finance of Poland


the use of transactional data is complementary to other methods of estimating reference

rates and is considered a priority in the light of the EU regulations.

The reform should ensure improved functioning and tamper-resistance of reference rates

used throughout the EU. It should also support the market supervision system.

Reference rates should be modernised in a way that ensures the legal and economic safety

of the banking system.

The introduction of market-linked elements will ensure that reference rates (in particular

new ones) will be based on representative transactional data for financial instruments with

a view to mitigating the risk of tampering and making reference rates more transparent and

representative.

JUSTIFICATION

Money market indices are a significant point of reference for any econo-

my. They are used as the basis for the valuation of various financial prod-

ucts. For example, the three-month USD LIBOR rate serves as an index

determining cash flows for derivatives worth a total of USD 100 trillion,

while WIBOR (all maturities) serves as an index for approx. PLN 6 trillion

worth of interest rate derivatives and over PLN 400 billion worth of loans.

The reform of money market indices was launched based on The Wheatley

Review of LIBOR, followed by a document from the working group at the

Bank of International Settlements and recommendations of EBA/ESMA ”What we have heard a number of times is that a common currency cannot work without a common economic policy. I think this is confusing causes and results. A currency should support the economy and should be adapted more or less to the economy and not vice versa. A single market is extremely good to promote competitiveness whereas a common economic policy not necessarily. The latter has a certain planning element which can block development in some areas where it would be possible.“

HSH Prince Michael von LiechtensteinChairman of Geopolitical Information Service AG


and IOSCO. The European Parliament drew up a proposed “Regulation on

Indices Used as Benchmarks in Financial Instruments”, while the Financial

Stability Board published a comprehensive report drawing on the work

of the Market Participants Group and IOSCO.

Financial market players have attempted to reform indices, driven by two

main objectives. The first objective was to strengthen the resilience to tamper-

ing, which has distorted LIBOR and EURIBOR rates on many occasions in the

past. The other objective was to increase the representativeness of a given rate,

i.e. its suitability for universal application as an index for on- and off-bal-

ance sheet products. Reformers concur that the two potential weaknesses

of indices may be remedied by changing their nature from declarative to

transaction-based, i.e. based on actual deposit prices.

Since 2012, the Gdańsk Institute for Market Economics has been collecting

data on prices of negotiable deposits accepted by commercial banks oper-

ating in Poland, within the context of the Money Market Monitoring System

(System Monitoringu Rynku Pieniężnego - SMRP ).

The SMRP project has been created on the initiative of the Institute and 12

banks with a view to building up a database containing information about

the evolution of the actual costs of financing the banking sector, thus offer-

ing an opportunity to compare those costs with other money market rates. The SMRP system

is currently used by 21 banks which account for 95% of the balance sheet total of the Polish

banking system.

The SMRP meets the requirements recommended and expected by institutions working on the

reform of reference rates in the European Union. An added value of SMRP statistics is that they

serve as a source of pricing information based on a wide range of transactional data originat-

ing from financial institutions with different liquidity levels and different liability management

policies. Consequently, system participants (commercial banks which have joined the SMRP)

as well as the Authorised Bodies (the financial supervision authority KNF and the central bank

NBP) have access, among other things, to rates with various breakdowns (e.g. by maturity, by

customer segment etc.), which allows them to investigate the intensity and direction of trans-

mission processes on the Polish zloty deposit market in Poland as well as the price elasticity

and changing liquidity preferences of customers.

”The fact that ECB’s active monetary policy was effective in bringing the European economy out of stagnation does not mean that it will be equally effective in future crises. (...) The next step in rendering the euro area more efficient should be the establishment of mechanisms of common fiscal policy and not merely avoidance of excessively lax policy by individual countries, but also creation of common policy that would be expansive in troubled times and restrictive in good times.“

Jacek RostowskiDeputy Prime Minister and Minister of Finance of Poland in 2007-2013


Cybersecurity of the financial sector

Taking into consideration the significant information security incidents tak-

ing place in Polish economy, the EFC has developed the following recom-

mendations for cybersecurity of the financial sector.

OBJECTIVE:

1. Ensure effective, consistent, uniform protection of financial institutions.

2. Tighten existing security processes in the financial sector.

3. Apply experience in financial sector cybersecurity to other sectors

of the Polish economy.

RECOMMENDED ACTIONS:

1. Establish a joint financial sector protection system by:

establishing an inter-bank organisation/unit to coordinate activities re-

lating to the exchange of information on the technical vectors of attacks

on individual sector players;

developing technical and/or process-oriented solutions preventing iden-

tified attack vectors and disseminating them among all sector players;

involving the regulatory authority in efforts to develop and build a Fi-

nancial Sector Protection System, including establishing the above-men-

tioned organisation;

involving public entities/organisations (e.g. ABW - Internal Security Agency)

”Each bank can do a lot on its own to protect itself against cyber crime. Banks may legally exchange information among themselves. However, all those measures are defensive. My idea is for the banks to try to do something in cooperation with IT security companies in Poland and to go on the offensive.“

Zbigniew JagiełłoPresident of the Management Board, PKO Bank Polski


in systemic cooperation with the newly established entity in the sector;

imposing an obligation on all financial sector players to immediately re-

port technical information about methods/signatures of attacks/security

incidents;

establishing cooperation with similar organisations functioning abroad

and with other commercial companies engaged in monitoring and re-

sponding to electronic security incidents worldwide.

2. Develop and update technical, legislative and process-oriented rec-

ommendations with a view to increasing the security standards of:

operations carried out by customers, regardless of the communication

channels they use;

organisations which are financial sector players;

(technical) services provided by third parties to financial sector players.

3. Develop an education and information programme for financial sec-tor customers regarding safe use of the Internet and online bank-

ing or, more broadly, financial services. This programme should be

implemented on an inter-bank basis, e.g. under the auspices of the

Polish Banks Association.

”How many ‘digital’ Poles are there? They account for approx. 11% of the‘18 plus’ population. In 2010, there were seven times fewer. We assume that they will make up over three-fourths of the Polish ‘18 plus’ consumers aged between 18 and 60 by the year 2020. We are talking about a trend that will become widespread in five years’ time. The majority of Poles will be ‘digital’. Financial institutions must think about it now.“

Jerzy KalinowskiPartner, Head of Advisory Group on Strategy and Operations, KPMG in Poland and Central and Eastern Europe


Mobilisation of long-term domestic savings

The Polish economy suffers from a shortage of long-term domestic sav-

ings, while future pensioners need additional capital for their old age to

offset the progressive decline in replacement rates within the framework

of the mandatory pension system. Therefore, we recommend:

1. The development of voluntary (third-pillar) pension schemes designed to

ensure the broadest possible participation. To this end, we propose:

combining the employee’s voluntary contribution with a top-up from the

employer and support from the state;

introducing a mechanism where employees are automatically enrolled

into a scheme but may elect to withdraw from it, whilst offering incen-

tives to remain in the scheme.

2. Removing barriers to the development of the capital market, which

should contribute to increasing the availability of long-term investment

vehicles for savers and to creating more sources of stable funding for the

banking sector. To this end, we propose in particular:

introducing regulatory changes to facilitate the issuance of covered bonds;

implementing MiFID II, which will force financial intermediaries to offer

investment products that are better suited to the customer’s needs and

will also be conducive to reducing product costs.

”The money invested directly in the shares listed on the Warsaw Stock Exchange account for as little as 3% of Polish household savings. Personally, I see a huge potential there. The consultative document on the Capital Markets Union indicates that mechanisms need to be developed and put in place to allow more extensive investment of household savings so that they are directly linked to and benefit from the growth of regional economies.“

Paweł TamborskiPresident of the Management Board, Warsaw Stock Exchange


3. Introducing mechanisms that promote an increase in household savings

in connection with government programmes to support housing.

JUSTIFICATION

Poland suffers from a shortage of domestic savings, and in particular

long-term savings, which hinders its development and threatens mac-

roeconomic stability.

The insufficiency of domestic savings in Poland is reflected by our net inter-

national investment position (NIIP – the difference between a country’s total

foreign assets and total foreign liabilities). For Poland, this indicator, which

shows whether a given country is a net creditor or debtor vis-à-vis the rest

of the world, stood at a negative 67 percent of GDP at the end of 2014,

making Poland one of the highest-risk countries among emerging economies

worldwide. Another important risk factor associated with the shortage

of domestic savings is the significant share of non-residents among the holders

of Polish Treasury securities, which amounted to 59 percent in 2014. Impor-

tantly, the deficit of domestic savings continues despite relatively low invest-

ment levels, including in particular low capital expenditure in the private sector.

In order to increase Poland’s economic potential and to catch up with the

standards of living enjoyed by the rich countries of Western Europe, we

must boost investment, which requires an increased accumulation of do-

mestic capital. The experience of the global financial crisis and of the eu-

rozone crisis has clearly highlighted the risk of staking growth on foreign

lending and has demonstrated that this risk is also present in the countries

that belong to the single currency.

The savings rate in Poland today is low compared to the EU in general, and the Polish house-

holds’ savings rate is particularly so. Therefore, in order to stabilise the Polish economic growth,

a substantial increase in the rate of domestic savings is required, particularly in the context

of limited access to EU funds and unfavourable demographic shifts in the future.

”Each banking group in Poland will be interested in having a mortgage bank within its organisation. Considering the national and EU regulatory framework, there is no other way today than covered bonds in terms of funding sources.“

Grzegorz PiwowarVice President of the Management Board, Bank Pekao S.A.


Long-term domestic savings are required so that the banking sector is able to provide

long-term credit to the economy following the introduction of the new regulatory solu-

tions.

Regulatory changes in the banking sector under the Basel III Accord will fundamentally restrict

the banks’ ability to provide long-term loans on the basis of short-term deposits. Therefore, in

order to enable the funding of long-term infrastructure and energy projects as well as to sup-

port housing, it is necessary to stimulate the growth of long-term domestic savings.

Future pensioners will need additional savings to offset the gradual decline in replace-

ment rates in the mandatory pension system.

The replacement rate in the mandatory pension system will steadily decrease. At the same

time the number of people who require top-ups from public funds to achieve the minimum

pension level will grow. The development of voluntary pension insurance could mitigate the

effects of this decline in replacement rates in the mandatory pension system, and if a portion

of the third-pillar pension is counted towards the minimum pension, it will also limit the need

for minimum pension top-ups. According to World Bank estimates, Poles should put aside

around 10% of their income to maintain the replacement rate at a level similar to the

current one. In a nutshell, Poles should save towards their retirement in their own best

interest, and this will also benefit the country.

To date, attempts to promote voluntary retirement savings in Poland have brought lit-

tle success, and subsequent state-supported programs (Occupational Pension Schemes,

Individual Retirement Accounts and Individual Retirement Security Accounts) have had

less and less effect.

Figures as of the end of 2014 show that the assets accumulated in Occupational Pension

Schemes (PPE) in Poland accounted for 0.59 percent of the country’s GDP, the assets


accumulated in Individual Retirement Accounts (IKE) amounted to 0.29 per-

cent of GDP, and the assets accumulated in Individual Retirement Security

Accounts (IKZE) came to less than 0.02 percent of GDP.

Contrary to received wisdom, Poles do not behave any differently from

citizens of other countries in their individual decisions concerning

pension matters.

In other countries, just like in Poland, it is mainly the affluent who are ac-

tively saving for their retirement, and encouraging low-income workers to

save for their old age by offering tax relief is generally ineffective. In gener-

al, tax credits neither increase the number of savers nor bring a significant

increase in savings in the economy. They merely result in shifts towards

those products that are subsidised and in the case of the EET system they

amount to fiscal transfers from all taxpayers to those with higher incomes

(90 percent of payments to IKZE accounts, which are stimulated by tax

incentives, come from top 20 percent of income earners).

Widespread participation is guaranteed by mandatory or quasi-man-

datory saving schemes. In the case of voluntary schemes, a high rate

of participation is achieved when employees are enrolled automati-

”Strong and enhanced consumer protection in the market of financial, including banking, services certainly seems desirable in Poland and requires certain consolidation as the misselling practices observed in the case of both the Swiss franc and other products eroded trust in the sector as a whole. Financial institutions do not compete on quality of services (...) but on cutting corners.“

Adam JasserPresident of Poland’s Office of Competition and Consumer Protection


cally, withdrawal requires an active choice and there are clear financial incentives to re-

main in the system. This is the type of solution that we propose to implement in Poland.

The growth in long-term domestic savings is strongly correlated with the development

of the capital market.

A developed capital market provides financial instruments such as bonds, covered bonds and

securitised instruments, which enable businesses and financial institutions to raise long-term

funding and also constitute attractive long-term investment vehicles for investors. Capital

market development will thus contribute to an increase in long-term savings in the economy

by creating more opportunities to invest in long-term instruments. Today, investment product

costs in Poland are relatively high as the mutual funds’ management fees are two or three

times those in developed markets. It is therefore important to implement MiFID II and to fur-

ther pursue regulatory and supervisory measures that force financial intermediaries to offer

investment products that are better suited to the customer’s needs and involve lower charges.

Greater pricing transparency and new generation products may effectively contribute to a much

broader and more rapid growth in long-term household savings.

The development of the capital market is therefore favourable to the long-term mobilisation

of domestic savings, and the reverse is also true – an increase in long-term savings contributes

to the quantitative and qualitative development of the capital market.


Long-term savings:

increase the availability of capital, which may fund the economy via the

stock exchange;

reduce the dependence of the domestic capital market on foreign capital;

enable the development of long-term institutional investors such as pen-

sion funds and mutual funds whose presence may provide a certain al-

ternative to foreign control over Polish companies.

Support for housing should be geared towards stimulating household

savings.

To date, housing policy in Poland has focused mainly on supporting de-

mand for new homes, thus fuelling increases in prices on the domestic

property market. In many countries, however, solutions are in place which

make public subsidies conditional on an increase in the household’s long-

term savings. Some government programmes should therefore include

mechanisms that make public subsidies contingent on increased savings in

the households that benefit from these measures.

”There is nothing more important in economic policy than keeping the economy on the path of sustainable growth. This calls for autonomous monetary policy and a variable exchange rate that helps balance the economy and reconcile the balance of payments on a continuous basis, and not only in time of crisis. The variable nominal exchange rate also allows stabilisation of the real effective exchange rate and the economy’s competitiveness.“

Andrzej SławińskiProfessor, Warsaw School of Economics


Efficient restructuring of enterprises in a crisis and better protection of creditors

On 9 June 2015, the President of the Republic of Poland signed the Restruc-

turing Law Act. The Act radically changes the approach to entrepreneurs

experiencing financial difficulties. It introduces four types of restructuring

proceedings, including recovery proceedings, and amends the definition

of bankruptcy of an entrepreneur. Restructuring proceedings will include:

1. Approval of an arrangement following the collection of votes by the debtor;

2. Expedited arrangement proceedings or “regular” arrangement proceedings;

3. Recovery proceedings.

The aim of the restructuring proceedings is to avoid the declaration of the

debtor’s bankruptcy by allowing the debtor to restructure by means of an ar-

rangement with creditors, and also, in the case of recovery proceedings, by im-

plementing recovery measures while securing the equitable rights of creditors.

The new regulations are intended to reinstate solutions which were in place

during the interwar period (separate regulations governing bankruptcy and re-

structuring proceedings). However, the new regulations do not take account of

the fundamental assumptions of regulations in force during the interwar period

– arrangement proceedings were in principle available only to entrepreneurs

who faced financial hardship because of extraordinary circumstances.

EVOLUTION OF BANKRUPTCY AND ARRANGEMENT LAWS IN POLAND

The main objectives of the regulations are to:

1. Ensure that efficient restructuring instruments are available to entrepreneurs and their

business partners, while maximising the protection of creditors’ rights;

2. Ensure that restructuring proceedings enjoy institutional autonomy separate from the

stigmatising bankruptcy proceedings;

”Projects carried out as public-private partnerships show a much higher profitability than those implemented using only public funds. (…) You have to remember that, in the PPP formula, the private entity takes on a huge, long-term commitment which it would never make if it didn’t anticipate a return on its investment. In PPP projects, it is the private entity which makes sure the joint venture makes economic sense.“

Jacek KarnowskiPresident of the City of Sopot

Regulation of the Presidentof the Republic of Poland

of 24 October 1934

1. Bankruptcy Proceedings Law2. Arragement

Proceedings Law

Act of 28 February 2003 Bankruptcy and Recovery

Law

1. Act of 28 February 2003Bankruptcy and Recovery

Law2. Act of 15 May 2015

Restructuring Law


3. Introduce the principle of subsidiarity of bankruptcy proceedings as ultima ratio, in a situation

where restructuring is no longer financially viable;

4. Give greater powers to active creditors;

5. Maximise the speed and effectiveness of restructuring and bankruptcy;

6. Deformalise proceedings and promote more extensive use of modern ICT tools;

7. Increase the accountability of unreliable debtors and bankrupts.

The new regulations are consistent with the new approach to business failure and bankruptcy

set out in the Commission Recommendation of 12 March 2014 published on 14 March 2014

in the Official Journal of the European Union L74 of 14 March 2014. The objective is to ensure

that viable enterprises in financial difficulties, wherever they are located in the Union, have

access to national insolvency frameworks which enable them to restructure at an early stage

with a view to preventing insolvency, and therefore maximise the total value to creditors, em-

ployees, owners and the economy as a whole. The Commission Recommendation also aims to

give honest bankrupt entrepreneurs a second chance across the Union.

The new regulations pose a serious challenge to all stakeholders in restructuring and bank-

ruptcy proceedings, and require professionalisation.

In order to minimise regulatory risk and ensure that the regulatory objectives envisaged

by the legislator are met, it is necessary to:

1. Develop a competence model for judges dealing with restructuring and bankruptcy cases,

and for prosecutors handling criminal proceedings, as well as a strategy for implementing

the model adopted.


2. Introduce compulsory 1st and 2nd level training for judges presiding over

restructuring andbankruptcy proceedings, ending in an examination

testing their knowledge in the field of management, economics and

finances, in particular 1st level training for judges starting work in Re-

structuring and Bankruptcy Divisions.

3. Establish a unit at the National School of Judiciary and Public Prosecution

responsible for professional training of judges, public prosecutors, law-

yers, legal counsels, official receivers and restructuring advisors. The unit

could also become a conduit for inter-organisational cooperation be-

tween courts in exchanging good practices with regard to the conduct

of restructuring and bankruptcy proceedings, and could also possibly fos-

ter cooperation with external entities. Moreover, by setting up portals and

discussion forums bringing together representatives of a given profession

or other stakeholders or interested parties, the unit could contribute to

stimulating the community of practitioners. The National School of Judi-

ciary and Public Prosecution could also play a vital role in transforming,

creating and accumulating knowledge.

4. Reduce the number of courts handling restructuring and bankruptcy

cases and ensure their professionalisation. It is necessary to develop an

optimal court organisation model adapted to the number of entrepre-

neurs and bankruptcy and restructuring cases in a given region.

5. In the transitional period before the Central Restructuring and Bankruptcy

Register is established (1 February 2018), implement a “good practice” in the form of the

platform for communication with parties to restructuring and bankruptcy proceedings de-

veloped by the District Court for the capital city of Warsaw, 20th Bankruptcy and Recovery

Division (http://www.upadlosci-warszawa.pl/). The aim of the platform is to facilitate stake-

holder access to essential information about ongoing bankruptcy proceedings. The website

lists general information about ongoing bankruptcy proceedings and detailed information

about the sale of real estate, movables, enterprises and other rights. The website also con-

tains certain templates for applications to be filed with a court. The website aims to ensure

the transparency of bankruptcy proceedings, especially with regard to the sale of assets.

6. Monitor the effectiveness of ongoing restructuring and bankruptcy proceedings in terms

of their duration, creditor satisfaction rates and restructuring rates (mid-term evaluation

”I wish to remind all those who claim that devaluation is the way to maintain competitiveness that the countries of southern Europe devalued their currencies every 3 to 4 years on a regular basis, but this did not make them competitive economies. Devaluation is the way for us to become less expensive but not more competitive. (...) A country with its own currency must either renounce its foreign exchange policy, which we did in Poland, or abandon its monetary policy.“

Dariusz RosatiMember of the European Parliament


of regulations). Encourage scientific research into the phenomena of bankruptcy, monitor-

ing systems and assessment of the impact of regulations on the condition of entrepreneurs.

7. Abolish criminal liability for failure to file an application for bankruptcy – Article 586 of the

Commercial Companies Code. Abolishing criminal sanctions is consistent with the assumptions

of the Communication from the European Commission of 5 October 2007 – Overcoming the

stigma of business failure – for a second chance policy. Implementing the Lisbon Partner-

ship for Growth and Jobs, which recommends drawing a distinction between entrepreneurs

whose insolvency results from fraudulent activities and entrepreneurs who became insol-

vent as a result of a financial or economic crisis, for example. This solution is in line with the

principle of subsidiarity of criminal law, also known as the principle of its ultima ratio, which

is most commonly understood as the need to apply criminal law as a last resort when other

responses prove ineffective. According to criminal law theoreticians, the severity of criminal

law in force in Poland is far from low. High punitiveness is the consequence of a belief that

criminal law is prima ratio in this regard, while low punitiveness is ultima ratio.

8. Ensure institutional strengthening of prosecution for offences consisting in intentionally

causing an enterprise to become insolvent or to declare bankruptcy. It is also necessary to

do away with the automatic application of provisions which release those who intention-

ally cause a company to become insolvent or to go bankrupt from liability under civil law

(contained in Article 299 of the Commercial Companies Code). Institutional strengthening

of criminal sanctions for intentionally causing a company to become insolvent or declare

bankruptcy would be consistent with the assumptions set out in the Communication from

the European Commission of 5 October 2007. They stress the need to differentiate between

bankrupts who are fraudulent or irresponsible, and those whose failure was through no

obvious fault of the owner or the manager, i.e. was honest and above-board. An optimal

model of managers’ liability for acting to the detriment of creditors should favour civil law

liability, only resorting to criminal sanctions on a subsidiarity basis. Given the unprepared

institutional environment (police, public prosecutor’s offices) and equal treatment of fraud-

ulent entrepreneurs and those experiencing financial hardships due to a change in economic

conditions (viewed as unfair by entrepreneurs), attempts to put a spin on reality through

criminal sanctions that are not enforced in practice are counterproductive, creating a lack

of respect for the law which sets the rules of the game.


9. Ensure the availability of financial statements in electronic form in the National Court

Register in order to provide parties to business dealings with information about the finan-

cial standing of entrepreneurs.

10. Set up a Bad Debt Restructuring Fund. The aim of the Fund would be to:

assume residual debts from bankrupt companies – at the request of the relevant judge-

commissioner,

assume all foreign debts from bankrupt companies – at the request of the relevant judge-

commissioner,

put debts up for sale,

conduct professional debt collection activities in Poland and abroad,

write off unrecoverable debts,

buy bad (toxic) assets and continue to collect them.


Accounting for megatrends in the development of technical infrastructure

1. Planning for the long-term development of technical infrastructure

requires multiple development scenarios to be considered, including

one that allows us to use technologies that are currently unknown

and unexpected.

JUSTIFICATION:

A key factor that shapes competitiveness on a global scale is a rational

development policy with targets that are socially useful on the one hand

and economically feasible on the other. In order to pursue such a policy, we

must understand the mechanisms by which megatrends emerge as global

phenomena, and their impact on those infrastructure sectors that remain

in the public domain.

For example, in recent decades human mobility patterns have only changed

a little under the influence of megatrends. It cannot be ruled out, however,

that the way in which mobility needs are met will change substantially in

the coming years. Three scenarios can be distinguished in the development

of human mobility: the innovative, the conservative and the intermediate.

Under each of these, the shift in attitudes toward cars will be connected

with a change in our approach to transport infrastructure.

2. Planning for Poland’s socio-economic development requires drawing up

an accelerated development programme which will bring our standards

of living closer to those of Western Europe, while taking into account

the fact that by 2030 both manufacturing and consumption in Europe

will be significantly different from what they are now.

JUSTIFICATION

The megatrends that we are witnessing, which will unfold in Europe and Poland by 2030,

include socio-demographic shifts such as population decline and ageing, changes in profes-

sional activity and different consumption patterns. These changes must be taken into account

when planning for the development of technical infrastructure.

”The greatest success will be seen by those banks which change their business profile – changing their scope of services, streamlining their structure, but increasing their reach. They will focus on a smaller number of customer segments, but will act on a larger number of markets. Banks which redefine themselves, developing innovative products and a simpler model for their activities, will attain the profit levels expected by investors. (…) Apart from the internal need for change, banks must also adapt to global megatrends which affect all sectors. These include the global market, digitization, demographic changes, and changes on the labour market. Some, such as technological innovation, have enormous potential for causing a revolution on this market. When customer needs evolve dramatically, technologies create new areas of activity for banks.“

Iwona KozeraPartner, Financial Services Industry Leader for Central and Southeastern Europe, EY


3. Meeting the increasing demands for effective and efficient implementation of the

innovative solutions delineated by megatrends poses a challenge for public authori-

ties. A key success factor is to create technical infrastructure capable of handling the

needs of residents as well as those of businesses and public entities that will operate

in the emerging reality of the “Internet of Everything” and of the increasing conver-

gence between sectors.

JUSTIFICATION

The changes referred to as megatrends are primarily influenced by two

groups: producers and consumers. The former invest in innovative products

when they think that this will bring additional profits in the foreseeable

future. Their behaviours are guided by the same iron financial discipline

observed by every entrepreneur. The latter use their available resources to

purchase goods and services. Consumers have the right to be guided by

emotions when choosing what goods and services they purchase, but as

a group they behave rationally or at least quasi-rationally. The rapid and

innovative operation of producers and consumers must be accompanied by

a mature socio-economic development policy drawn up and implemented

by public authorities at various levels. Future service models will aim to

increase the role of users in shaping infrastructure services. At the same

time, infrastructure providers will be responsible for the economic outcome

of the entire solution supplied. ICT seems to be an exception here – a sys-

tem that shifts the world of applications farther and farther away from the

infrastructure, and whose potential for transferring data in quasi-real time

and advanced network management systems make it a meta-infrastructure

for both transport and energy.

”The increasing intensity and frequency of extreme weather conditions as well as global and regional scenarios of climate change induce national governments along with regional and local authorities to display greater care in assuring proper conditions for growth in the rapidly evolving reality. The changing climate also poses challenges for the insurance and financial sectors.“

Maciej GrabowskiMinister of the Environment of Poland


A judicial system supporting the country’s competitiveness

Legal certainty is an essential precondition for the security and quality

of economic relations. It gives economic operators confidence, opens up

development opportunities and mitigates the risk associated with conduct-

ing business. Unfortunately, the deficient judicial system is increasingly

hampering Poland’s economic development. The following recommenda-

tions can be drawn from the work of the European Financial Congress.

1. A balance should be sought between public and private interests

JUSTIFICATION

Constitutionally protected equality (regardless of status and position in the

state system) and the statutory equality of the parties to an agreement, as

well as the principle of cooperation in the performance of the agreement,

confirm the fact that it is not only the state (the public sector) that works for

the common good, but also private enterprises.

The existing strong tendency to foreground the interest of the state in con-

tractual relationships needs to be changed as soon as possible. Such trends,

which stem from the time of the People’s Republic of Poland and which are

rooted in the fear of being suspected of corruption, often lead to the interest

of the state being treated as a fetish and considered synonymous with the

public interest (common good). It is necessary to understand the public

interest as the common good and not only as the interest of the state.

”You can’t speak about proper relationships in business without considering what’s going on in the justice system. The ability to enforce liabilities is a vital issue, particularly in respect of restructuring and bankruptcy processes. We have to fundamentally heal the current situation where, in some courts, the effectiveness of liability enforcement is at a level of 11%.“

Jerzy GajewskiPresident of the Management Board, NDI S.A.


2. The quality of legislation must be improved so as to ensure that the

legislator’s ideas are communicated in a comprehensible way and that

clear normative solutions are offered. Such measures should go hand

in hand with a consistent deregulation process.

JUSTIFICATION

Ad-hoc legislative acts adopted to solve current problems or to achieve

short-term political aims result in subpar legislation being passed, as con-

sequently reflected in a continuous string of legislative amendments. This,

in turn, brings about difficulties in the application of the law. As a result,

common courts, as well as the Supreme Court, must substitute the legislator

and interfere with the content of the law in order for a case to be examined.

Horizontal improvement of legislation should mainly entail the adoption

of fewer legislative acts. To this end, a change in the system of drafting

and adopting legal acts should be considered, besides a system of moni-

toring the operation of the law. While respecting already existing legisla-

tion, it is essential to curtail the “fast-track” legislative path.

3. It is necessary to reduce the time necessary to resolve disputes

concerning business cases by streamlining the work of courts at the

individual levels and by more extensive application of arbitration.

JUSTIFICATION

The duration and quality of the resolution of disputes in public-private relations depend on

two fundamental factors, i.e. the manner in which the administration works and the func-

tioning of the legislative system.

Administration style should be made more consultative and negotiation-oriented instead

of the current imperative system. Administrative discretion should be accepted to a much

larger extent than it currently is. Moreover, it should not only be enshrined in legal regula-

tions, but even more importantly, the necessary conditions should be created to enable its

use in practice. Today’s model of combating corruption (the so-called loophole-free law) in

principle eliminates discretion from the legal system (even if it is preserved, it is not applied

by officials concerned about being accused of corruption). This model of combating corrup-

tion should be changed. Broad social control, rather than loophole-free law, which in any

case is impossible to achieve, is the direction to follow when fighting corruption.

”The introduction of the monetary union came with the promise that the economies of the peripheral countries and those of the core countries would converge. Nothing of the sort happened, in fact just the opposite. Why? This is attributable to the fact that the euro is a currency that is not adapted to the countries currently making up the eurozone. Europe is too diversified both in social and political terms.“

Zdzisław KrasnodębskiMember of the European Parliament


An important aspect of changing the inner mechanisms of administration is making it gen-

uinely liable for its actions. Changing the way administration works will make it possible to

significantly reduce the number of disputes and the workload of the judiciary.

It is essential to ensure that the solutions imposed by the law are executed, including short

deadlines for resolving cases, swift court procedures and well developed arbitration.

It is necessary to start working on streamlining the judicial system, in particular to:

introduce professional court management at all levels,

make court procedures more flexible,

make court rulings in similar cases more uniform,

ensure that the existing case law of the Supreme Court and common courts (especially

the appellate courts) is properly applied in everyday economic practice,

establish a Centre for Economic Expert Studies, providing substantive support for the ju-

diciary,

develop a competence model for judges ruling on economic cases and manage the rela-

ted training system.


Proactive industrial policy, or the end of short-termism

We recommend:

1. Commencing work on a Polish industry development strategy which addresses not only

the largest enterprises segment, but also the segment of medium-sized enterprises, includ-

ing family-run ones.

2. Commencing work on development of a mechanism for coordinating activities and taking

advantage of synergies as regards the implementation of the industry development policy

between the Ministry of Treasury, the Ministry of Economy, the Industrial Development

Agency JSC, Bank Gospodarstwa Krajowego (the State Development Bank of Poland), Polish

Investments for Development S.A. and KUKE (Export Credit Insurance Corporation).

3. Commencing work on finding an optimum mechanism for development of the private equity

funds market, in particular in the mid-cap growth fund segment.

4. Taking proactive measures with a view to mitigating short-termism in the Polish economy

and on the Polish capital market, including:

regulatory and tax solutions encouraging institutional investors to hold assets in their port-

folios on a long-term basis,

observance of good practices regarding the assessment and remuneration of managers

of companies with strategic importance.


JUSTIFICATION

The Polish economy requires reindustrialisation and innovation. This is

a new challenge which, following a period of transformation, allows

Poland to improve its competitive edge in the era of globalisation. It is

difficult to rise to this challenge in an environment of growing short-

termism, where decision-makers focus on short-term measures and

objectives. The causes of this global trend are complex and primarily

rooted in changes in the way capital markets function, in a crisis of trust

and in new technologies. As a result, managers of public companies are

finding themselves under pressure from investors demanding short-term

results from companies. Value management falls prey to short-term

goals. In effect, short-termism leads to:

investments being neglected;

human capital being neglected;

turnover of management boards refusing to comply with short-term

expectations of investors.

On the other hand, the development of modern and innovative industry is

one of the most important elements in the process of building a strategy

of long-term and sustainable economic growth. A great leap forward for

our country and an escape from the medium growth trap are only pos-

sible through the growth of companies making products with high added value which will

have a strong position on international markets. This proposition applies to both large and

medium-sized industrial enterprises. In particular, international examples show that a consid-

erable portion of the added value of industrial output targeting domestic and export markets

is generated in the most developed countries by medium-sized enterprises specialising in their

niche segments at the global level.

The role of such leaders is multidimensional, but the following aspects need to be high-

lighted first and foremost:

1. Technologically advanced products rely for their competitiveness to a large extent on factors

other than pay, which helps generate higher salaries for the employees involved in their

production, and ultimately raises the level of affluence of the entire society.

2. The presence of technologically advanced Polish products on international markets opens

up access to those markets for many other entities. Modern export firms therefore func-

tion as trailblazers.

”(…) every business is free to raise the economic value of its assets through reasonable and intelligent multiplication of its soft capital. Of course, this cannot be achieved by thinking inside the box but we may succeed by asking ourselves not only how we go about doing something to make it efficient but also why we are doing this and what purpose it will serve in terms of value, i.e. ability to generate economic value in the long term.“

Jerzy HausnerProfessor, Cracow University of Economics


3. Modern industrial projects involve longer and higher investment

commitments – building the investors’ permanent presence in the Polish

economy and exerting a positive influence on the local and regional en-

vironment.

The following economic entities and administration bodies which exist in

the Polish economy implement the country’s development policy, includ-

ing in the area of industrialisation: the Ministry of Treasury, the Ministry

of Economy, Industrial Development Agency (ARP), Bank Gospodarstwa

Krajowego, Polish Investments for Development S.A. Also worth mention-

ing are the National Centre for Research and Development (NCBiR), the

National Capital Fund (KFK) and the Polish Agency for Enterprise Develop-

ment (PARP), as institutions involved in financing venture capital projects

(such activities have also been undertaken by ARP), which can sometimes

ultimately target industrial companies. An important role in the reindustri-

alisation policy may be played by KUKE through the provision of guarantees

for exporters, in particular on “higher risk” markets. However, at the mo-

ment there is no national strategy for the entire industry sector. Such

a document should be drawn up and the above-mentioned institutions

should be involved in the implementation of this strategy. At the strate-

gic level, such a document would help to coordinate activities among those

institutions. At the operational level, numerous potential synergies between

them – both organisational and capital-related – should be identified.

”Climate change is a physical problem and a financial problem. The accident gets stopped by proper planning of cities. The insurance industry offers one thing only, i.e. money, either as a sticking plaster merely to cover a wound or as risk financing in the form of contingent financing to smooth out the volatility we are experiencing. The latter is like a hybrid between an insurance product and a bank loan when you need it but you don’t have to pay it back until the conditions are good again.“

Dan TomlinsonManaging Director, Allianz Risk Transfer (UK)


The above-mentioned institutions could also get involved in developing the

capital market in the segment, as required to meet financing needs related

to the implementation of the industrialisation strategy. At this point, at-

tention should be drawn to the need to develop the OTC market for private

equity funds, in particular in the segment of growth and industry-oriented

funds. Such funds have a special role to play in financing the growth

of medium-sized industrial enterprises, for which the public market may

only become a viable option in the future.

”The lack of investments and the relatively low growth rate of credit for businesses is not so much the effect of a lack of access to funds, but of a lack of investment needs.“

Andrzej KopyrskiVice President of the Management Board, Bank Pekao S.A.

Academy


Poland – a paradise for talentrecommendation of the EFC Academy

This recommendation of the European Financial Congress Academy is tar-

geted at Polish enterprises and public administration bodies as employers.

Its purpose is to provide simple solutions that will attract the best under-

graduates and persuade them to remain in Poland. The recommendation

includes three points:

1. Raising the profile of internships through:

implementing a transparent recruitment system;

clearly defining the trainees’ competences.

2. The internationalisation of human resources through opening the door

wider to employees with international experience.

3. Introducing shadowing schemes.

JUSTIFICATION

1. In order to encourage outstanding undergraduates to take up employment,

it is necessary to plan their work carefully. Quality internships must in-

volve a clear definition of the trainees’ responsibilities and competences.

In such an environment, the young employees feel they are being treated

professionally and assume responsibility for the operation of their part

of the company. They mean more to the organisation and are better mo-

tivated. If internships are to encourage the best undergraduates to start

work, the increase in their number must not come at the expense of their

quality.

A transparent and structured recruitment system is another element that is extremely impor-

tant for job candidates. 57% of potential employees under 25 think that employers in Poland

do not care about building up relationships with them, and every second applicant never

learned why he or she was not hired (eRecruiter 2015). Regardless of the outcome of the

”The threat of Grexit means that the eurozone is no longer viable. (...) This redefines, to some extent, Poland’s appetite and the political and economic debate in Poland on the point of the country’s accession to the euro area.“

Mateusz MorawieckiPresident of the Management Board, Bank Zachodni WBK


recruitment process, it should involve feedback to each applicant. This approach shows re-

spect for candidates and encourages them to resubmit their applications in the future, when

they have acquired more experience and the expected competences.

2. An international environment enhances working conditions, and more diverse teams achieve

better results. Furthermore, the Polish economy is on a path towards rapid internationalisa-

tion. Polish exports currently amount to 49% of GDP (the highest ratio among the six larg-

est EU economies) and continue to grow. Companies are increasingly expanding overseas

– of 18,000 medium-sized and large Polish enterprises, nearly 10% have opened subsidiaries

abroad (NBP 2015). Moreover, since Poland’s accession to the European Union, public ad-

ministration bodies have been cooperating ever more closely with European institutions. To

fully take advantage of this situation, human resources policies should also follow the trend

of internationalisation.

In addition, the conflict beyond our eastern border has brought more Ukrainian citizens to

Poland than ever before. Poland needs not be merely a transit country for them – it should

consolidate its position as regional leader and enable the most talented emigrants to con-

tribute to the development of the Polish economy.

3. The main purpose of shadowing schemes wherein trainees can observe leaders at work is to bring

the most outstanding undergraduates into direct contact with key organisation representa-

tives. The scheme consists in observing managers and assisting them in their daily tasks.


This brings many mutual benefits:

Students have an opportunity to develop leadership skills by observing the work of those

in top positions. Such experience is also very inspiring and yields a different perspective on

career development.

Employers greatly increase their chances of employing and building up relationships with

the most competent candidates. Additionally, such schemes directly involve key executives

in the recruitment process, helping the organisation to build a culture of accessibility and

understanding. The involvement of key people in the organisation testifies to their interest

in the development of young employees, which significantly increases the chances of re-

taining the best people in Poland.


Should non-euro area countries join the Banking Union and, if so, when? – an update

I.

On 4 November 2014, the Banking Union (BU) became operational on a regular basis after

year-long preparations. The experience and observations gathered during the initial eight

months of its operation and the previous detailed audit of asset quality provided the non-euro

area countries with a fuller insight into the costs and benefits of their possible accession to

the BU under the so-called principles of close cooperation. A more in-depth analysis than the

last year’s one confirms that a significant amount of the concerns relating to the shift of

the supervisory competences to the European level and to the keeping of financial ac-

countability at the national level have been eliminated.

II.

The joint decision-making process involving supervisors from all SSM participating countries,

and the detailed knowledge of the financial condition of individual banks made available to

them, supported with the findings of the asset quality review, have additionally contributed to

mitigating the moral hazard risk inherent in the transfer of assets within cross-border banking

groups. As a result, banking systems covered by the Banking Union’s mechanisms have

become more stable.

The integration process in the countries participating in the Banking Union is proceeding very

swiftly. Moreover, non-economic conditions currently represent the key factor accelerating


the measures promoting stronger political integration of the BU countries

(this currently applies to the euro area only). The countries not participating

in the Banking Union, such as Poland, are not benefiting from that integra-

tion in spite of the fact that 50% of the assets of the Polish banking sector

are held by banking groups subject to the ECB’s supervision. It is thus of

paramount importance that a dialogue be conducted with the Single Su-

pervisory Mechanism (SSM) within the fora of the colleges of supervisors

and in direct contacts and that the effective rules of cooperation be agreed

jointly.

It needs to be stressed that non-cooperation within the colleges of super-

visors would lead to a situation where the voice of the host supervisors

from outside the Banking Union becomes less distinctive and, consequently,

increasingly less audible. By opting out of the Supervisory Board they will

have no say in the Board’s decisions, i.e. the decisions made by the consoli-

dating supervisor. Consequently, all supervisors not participating in the SSM

must, where possible, identify ways of communicating with their partners at

the ECB even before they take binding decisions also affecting banks oper-

ating outside the Banking Union. They are also encouraged to demonstrate

their readiness to join the Banking Union, should their analyses suggest that

such decision would be beneficial to them.

III.

Following the initial waiting period, some countries are beginning to show

interest in the Banking Union. Romania was the first country to express its

willingness to join the SSM. An analogical declaration was made by the gov-

ernment of Bulgaria. The governor of the Bank of Denmark spoke in favour

of the country’s accession to the Banking Union and was joined by the Dan-

ish government which expressed an interest in establishing close coopera-

tion with the ECB, declining, however, to set the date by which it would be

ready to do so. Finally, the Czech government drafted an internal report as-

sessing the benefits and risks associated with the country’s engagement in

close cooperation with the ECB. The report, which is thought to provide the

basis for a future decision on possible BU membership, is to be updated on

a regular basis. It is, therefore, evident that the integration processes within

the framework of the European Banking Union project are gaining momen-

tum. Accordingly, the weaknesses and strengths of BU membership and the

related benefits and risks must be urgently examined. Such analysis shall be

”The establishment of the SSM will lead to more unification. We are now starting a harmonized day-to-day supervisory approach. Harmonization is also a unique objective of the European Banking Authority. It will mitigate the appearance of “a big elephant”, the SSM, in the room.“

Erich LoeperHead of Banking and Financial Supervision Department, Deutsche Bundesbank

”Prudential regulations on the European level are fully harmonised. But supervisory practices differ. It makes no sense to have two approaches: one applied on the local level and the other for supervisory colleges. Therefore, we should do our best to have local and SSM supervisory practices harmonised as well.“

Andrzej ReichDirector of the Banking, Payment Institutions and Credit Unions Regulations Department, Polish Financial Supervision Authority


conducted for a number of scenarios assuming, as a minimum, that:

the Banking Union project succeeds once implemented or the Banking

Union attracts legitimate criticism;

Romania will be the only country establishing so-called close coopera-

tion with the BU or that more countries demonstrating their interest

in the BU membership, especially Denmark, choose to engage in close

cooperation;

the decision is made to establish the Single Deposit Guarantee Mecha-

nism or the work thereon is definitely abandoned;

the experiences of non-BU countries derived from their relations with

the ECB as the consolidating supervisor are positive or that they are

negative;

the experiences of the countries engaging in close cooperation with the

ECB are positive or that they are negative;

the United Kingdom, accounting for approx. 30% of the assets of the EU

banking sector, exits the European Union or decides to continue as its

member state.

The analysis should consider the factors likely to offer protection against

any disadvantageous rules arising from close cooperation and propose the

safeguards that a given country could discuss with the ECB prior to decid-

ing on its engagement in close cooperation. Meanwhile, it should be kept

in mind that the ultimate outcome of the analysis, regardless of the scenario adopted, will

depend on the developments involving the third pillar of the Banking Union, namely the Single

Deposit Guarantee Mechanism. Thus, only a limited analysis of the benefits and risks can be

conducted before any final decisions are made in that respect.

According to Council Regulation (EU) No 1024/2013 conferring specific tasks on the European

Central Bank concerning policies relating to the prudential supervision of credit institutions, the

decision to engage in close cooperation with the SSM shall be made by the government

of a given country and, consequently, any such country should gather beforehand the

relevant analytic data analogical to that produced in the Czech Republic. Also, in addition

to the supervisory matters, an analysis of some country-specific legal or systemic issues may

have to be carried out in certain countries such as constitutional matters or designation of the

authority tasked with the decision whether or not to engage in close cooperation with the SSM.

For their part, the supervisory authorities should strive to establish the closest possible op-

erational cooperation with the SSM, especially when the eurozone banks hold a majority stake

in the country’s banking sector, to ensure that the existing, often close, cooperation with the

home supervisors is not restricted.

”If you do not participate in the SSM you cannot decide for us. This is demanding a bit too much. If you want to participate in decisions the way to do it is to opt in. If you want exchange information we are totally open and happy to do that. (…) As long as the markets have their own business cycles there is still a long way to go to harmonization. We need national authorities to be the first to impose macroprudential measures and then the ECB can top up if it sees a need.“

Korbinian IbelDirector General, Micro-Prudential Supervision IV, SSM, European Central Bank


JUSTIFICATION AND MORE DETAILED DESCRIPTION

The Banking Union, an element of which is consolidated banking supervision, is an or-

ganisational and not a regulatory concept, although it relies on regulatory solutions.

The pillars of the Banking Union include:

the Single Supervisory Mechanism (SSM);

the Single Resolution Mechanism allowing the restructuring of banks and their controlled

bankruptcy, financed by the banking sector itself and not from taxpayers’ money;

the Single Deposit Guarantee Mechanism.

Their operation shall be governed by the regulatory legal framework, respectively:

the CRD IV Directive, together with the Capital Requirements Regulation (CRR), establishing

prudential rules for banks, building societies and investment firms;

the Bank Recovery and Resolution Directive (BRRD) governing the orderly restructuring and

winding up of credit institutions;

the Directive on Deposit Guarantee Schemes (DGS) harmonising rules of operation of the

deposit guarantee system.

It is worthwhile to note that the aforementioned legal acts are not linked to the Bank-

ing Union project and apply to all member states, regardless of their relations with the

Banking Union.

It is precisely on that foundation that the pillars of the Banking Union rest. In October 2013,

a regulation was adopted that conferred tasks on the European Central Bank concerning


prudential supervision of eurozone credit institutions (Single Supervisory Mechanism, or SSM).

This was followed by the regulation governing restructuring and winding up of credit institu-

tions in the countries of the Banking Union (Single Resolution Mechanism, or SRM) effective

as of April 2014. The Single Deposit Guarantee Mechanism, the most controversial of the

schemes, appears to be the only element preventing formal closure of the project. Its estab-

lishment necessitates a distinctly wider political consensus that is far more difficult to build.

As a result, the work in this area is progressing at a much slower pace.

The SSM Regulation took effect on 4 November 2014. The SSM governing bodies have

been appointed and intense employee recruitment is nearing its end. Procedures have been

put in place that will underpin future supervisory measures. The rules for exercising common

supervision under the Single Supervisory Mechanism (SSM) have been agreed.

The ECB has readied itself for the assumption of new responsibilities in con-

nection with banking supervision under the SSM mechanism. That mecha-

nism laid the ground for the new financial supervision system encompass-

ing the ECB and the competent national authorities from the participating

member states. Establishment of the SSM management structures has been

successfully completed, including development of appropriate rules and

organisational solutions. In particular, the Governing Council adopted the

Framework Regulation for the Single Supervisory Mechanism at the request

of the Supervisory Board.

Joint supervisory teams that constitute the primary operational structure

exercising SSM supervision are being appointed. The ECB already employs

some 800 staff tasked with joint supervision. The ECB gathers, processes

and transmits the reporting data of supervised credit institutions to the

European Banking Authority (EBA).

The asset review process has been successfully completed. Its findings,

along with the results of EBA’s stress tests, were published in late October

2014. Those results provide a unique opening balance illustrating the condi-

tion of the banks covered by ECB’s direct supervision. This is of paramount

importance as starting from 4 November 2014 the ECB took over responsi-

bility for the stability and security of those banks.

Contacts with the supervisors forming the European supervision attest to

rapidly progressing integration, much faster than envisaged a year

”Is it possible that with macroprudential decisions being primarily at a national level but microprudential decisions at the SSM and national level, the discussion about fragmentation or defragmentation should be more focused on the risks that macroprudential measures, unless properly done within a single market setting, pose a bigger threat to the single market than the microprudential supervision practices?“

Piers HabenDirector, Oversight, European Banking Authority


before. The core element of that integration is the process combining joint

decision-making with shared accountability in matters involving banks

subject to common supervision. The European Central Bank plays a lead-

ing role here. The supervisory function is actually being shifted towards

Frankfurt. Compared to the expectations voiced at the European Financial

Congress held in mid-2014 when the issue was being discussed, the proc-

esses of integrating the SSM supervisors have accelerated considerably. The

actual involvement of the ECB in the banking supervision functions across

the SSM participating countries is also proceeding swiftly.

The Banking Union was established to build greater trust in the EU banking

sector and its security and, consequently, to promote financial stability. The

common decision-making mechanism and the related common tools sup-

porting banks’ stability and security are expected to contribute to attain-

ment of those goals. Unfortunately, the only available legal basis enabling

swift establishment of the Banking Union has introduced one major limita-

tion, namely extension of the project exclusively to the euro area countries.

The current prospects for engagement of the remaining countries in close

cooperation with the ECB do not envisage full accessibility of the safe-

guards and controls.

Establishment of the Banking Union will have far reaching implications for

the European Union as a whole, implications whose scale is difficult to fore-

see at the present moment. It is beyond doubt that the member states have been divided into

three groups by the establishment of the Banking Union, namely:

the euro area countries with full decision-making powers and full access to the safeguards

and controls;

the non-euro countries that have engaged in close cooperation with the ECB and hold simi-

lar, although not full, decision-making powers, do not enjoy access to the safeguards and

controls available to the euro area countries despite the efforts to identify opportunities for

development of their possible equivalents; for this reason they have different safeguards

and controls in place that, under certain circumstances, will give them the discretion not to

comply with the ECB decisions targeting them;

and finally, the non-euro area countries that did not engage in close cooperation with the

ECB and, consequently, have no say in the decisions made under the SSM or SRM and do

not enjoy access to the safeguards and controls available to the countries included in the

first two groups.

„The dividing line between microprudential and macroprudential supervision is much more blurred. This is really a challenge to make macroprudential policies operational. Here I think there is a room for practical improvement between central banks, macroprudential authorities and microprudential supervisors.“

Edouard Fernandez-BolloSecretary General, Autorité de Contrôle Prudentiel et de Résolution,Banque de France


Without doubt, the eurozone countries are best protected against financial instability. This is

attributable not only to the safeguards and controls available to them but, first and foremost,

to the fact that the ECB is responsible for their stability. Under the current structure, both the

European Systemic Risk Board (ESRB) in charge of financial stability and the SSM tasked with

security of individual banks are part of the ECB. The ECB must therefore ensure that decisions

made at all levels do not threaten the stability and security of the financial system of euro area

countries and those of the countries closely cooperating with them, as the ECB is responsible

for their stability both at the macro level, through the ESRB, and at the micro level, through

common supervision. In the case of closely cooperating countries, this task will prove more

demanding given that ECB’s intervention capabilities will be more restricted, which, however,

will not limit ECB’s accountability, whether actual or image-related.

The countries not participating in the Banking Union are in a more precarious position. They

do not form a single body which could strengthen their position vis a vis the Banking Union,

do not have any safeguards or controls in place and, in case of problems affecting stability

of their financial system, e.g. through the spillover effect, may rely solely on their home in-

stitutions and locally applicable instruments. In other words, they will find themselves in the

situation which the euro area countries, troubled by the global crisis, experienced a few years

ago, which ultimately led to the establishment of the Banking Union. On the other hand, the

strength of those countries lies in their sheer number. There are nine of them, including the

United Kingdom with the largest banking system in the European Union. Still, the actions of


the UK are not entirely predictable in the current political climate. Additionally, this group

is extremely disparate. The banking systems in those countries constitute from almost 30%

of the EU banking sector (the UK) to less than 1% (Hungary, the Czech Republic, Bulgaria or

Romania). They have conflicting interests, different priorities and, consequently, hardly make a

solid partner for the SSM.

In its Decision on the Close Cooperation with the National Competent Authorities of Par-

ticipating Member States whose Currency is not the Euro of 31 January 2014, the European

Central Bank set forth the procedure for establishing close cooperation. This applies to close

cooperation requests, evaluation of those requests by ECB and possible instances of suspen-

sion and termination of close cooperation. The decision provides the procedural framework

for establishment of close cooperation. Meanwhile, the Regulation adopted by the Governing

Council determines the course of the aforementioned procedure and the manner in which

supervision is to be exercised following its introduction.

Accordingly, the plans of the nine non-euro countries are obviously attracting interest, espe-

cially now that the Single Supervisory Mechanism has just become fully operational. Still, the

question remains relevant. In June 2014, the governor of Romania’s central bank announced its

plans to participate in all three pillars of the Banking Union. According to Mr. Mugur Isărescu,

participation in that European project would translate for Romania into enhanced financial

stability, increased trust in the domestic banking sector and support for sustainable economic


growth. It would seem that the decision of Romania, a peripheral country, does not change

anything other than the proportion of the countries participating in the Banking Union to

those remaining outside it. This, however, is highly unlikely. What counts in this case is not

which country has resolved to join the Banking Union but the very fact that a country has

opted to do so. For any country following in Romania’s footsteps, making such decision might

be easier and soon enough the countries, regardless of their number, which are considering

the move for the time being, are likely to make up their minds as the last ones to join the BU

are bound to have the least say. That process may weaken the already weak position of the

countries remaining outside the Banking Union.

There is no doubt that Romania analysed the arguments for and against engagement in close

cooperation with the ECB and concluded that the benefits override the risks. Obviously, one

cannot assess Romania’s decision without being aware of the content of the analysis and of the

arguments employed. Neither is it clear whether the arguments for and against that decision

will withstand the test of time and its confrontation with the routine (or rather unusual) activ-

ity of the SSM. One can hardly expect the Romanian supervisors to provide a detailed ration-

ale for their decision. Nonetheless, the question is worth asking. But, first and foremost, it is

advisable to carry out an analysis, as detailed as currently possible, of the

pros and cons of engagement in close cooperation and of the opportunities

and threats involved. Such analysis may have to be expanded to examine

various follow-up scenarios. If a number of countries follow in Romania’s

footsteps over the coming years, especially countries of critical importance

to the financial sector of the European Union, the conclusions of that analy-

sis may differ completely from those derived from a study based on the as-

sumption that no country would take the same path for a long time to come.

Advantages for non-euro area countries of joining the Banking Union

1. In the first place, extension of ECB’s authority to the banking sector of a

given country should be highlighted. Even if the security mechanisms at

the Banking Union level prove weaker than in the case of the eurozone

countries, the fact that a given banking system is covered by the Banking

Union’s mechanisms will contribute to its enhanced security, and just as

importantly, improve the image of that banking system and its supervi-

sion.

2. Considering the ownership structure of the Polish banking sector, it would

be highly advantageous for the country to exercise voting rights within

the Supervisory Board. Those powers should be perceived as a whole.

”The euro area, along with everything required to make it work, may be seen as a sort of encouragement to continue the policy beneficial to the country whereby no one is allowed to come up with the idea that public debt can be raised, large deficits may be run up and too much easing is permitted in the monetary policy. Let us treat the eurozone as a directional challenge.“

Dariusz FilarProfessor, University of Gdańsk


The Board makes decisions in the matters involving each bank subject to

ECB’s direct supervision. It is rather unlikely for the decisions to be made

in the face of a reasonable objection from the interested countries. Each

of the supervisors holds one vote, regardless of the size of the banking

system represented. His or her vote must concur with the votes of the

remaining supervisors. Moreover, the decision-making mechanism must

be based on the principle of reciprocity, as the supervisor who joins the

Banking Union acquires the right to express his or her opinions and co-

decide on the matters affecting banks from other countries.

By staying outside the Banking Union, a country no longer has a say

in the decisions taken by the Supervisory Board and, thereafter, by ECB

within the framework of exercise of common supervision. Those deci-

sions may have an indirect, sometimes adverse, effect on the countries

which have resolved not to join the Banking Union.

3. The position of the non-euro area participating countries has also been

secured under the SRM mechanism. The interests of the member states

from outside the eurozone which have consented to be covered by su-

pervision and the Single Resolution Mechanism within the framework of

close cooperation shall be safeguarded through the inclusion of those

countries in the decision-making process if the decisions being made

affect the banks operating within their territory.

Under SRM, the votes cast by the host countries have the same power as the votes cast by

the home countries in decisions made by the Single Resolution Board with respect to cross-

border banks.

Uniform treatment of the countries participating in the Banking Union, regardless of wheth-

er or not they are members of the eurozone or have engaged in close cooperation, has also

been envisaged in the context of the resolution fund. The concerns regarding establish-

ment of ECB’s capital key as the basis for making contributions to the fund have proved

unfounded. The method adopted for determining the contribution based on the banks’ debt

minus own funds and guaranteed deposits is advantageous to countries such as Poland

whose share in the banking sector of the entire European Union is small.

One should keep in mind, however, that accession to the Banking Union by a country from outside the eurozone may also have negative consequences.

„Never before have similar mechanisms preventing and combating crises been in place in Europe. Those include, but are not limited to, the Single Supervisory Mechanism and, more importantly, the Single Resolution Mechanism combined with full harmonisation of the operation of guarantee funds. The aforementioned solutions address the problem of a cross-border crisis and of a spillover effect following a large bank from one country to another.“

Jerzy PruskiPresident of the Management Board, Bank Guarantee Fund


Foremost among these is unavailability of the stability mechanism and of ECB’s liquidity as-

sistance. The euro area countries are eligible to receive assistance from the European Stability

Mechanism (ESM). Introduction to the SRM Regulation of the possibility for the resolution

fund to borrow money on the financial markets has mitigated that restriction to a small extent

as lack of access to the ESM continues to be a problem for the countries that would opt to

engage in close cooperation. It is, therefore, expedient to assure liquidity support for all banks

supervised by the ECB.

A major issue for our country, whose banking sector is considered healthy and safe compared

to the other member states, is the shift in decision-making powers at the time of establish-

ment of the so-called liquidity subgroups following accession to the Banking Union. Under

CRR, free cash flows may take place within the established liquidity subgroups between banks

participating in the same subgroup. For a liquidity subgroup to be established, a joint decision

must be made by the consolidating supervisor and the competent authorities in charge of su-

pervision over the subsidiaries (banks) in various countries. If no joint decision can be reached

in due time or following exhaustion of the mediation mechanism, each competent authority in

charge of individual supervision shall make an independent decision binding upon the parties.

This means that a national supervision authority may effectively deny inclusion in a liquidity

subgroup of any bank over which it exercises supervision in the capacity of host supervisor.

In the case of the banking union, if establishment of a liquidity subgroup involved banks sub-

ject to ECB supervision, the decisions relating to the establishment of such a subgroup would

actually be made by the ECB at its discretion as the consolidating supervisor tasked concur-

rently with supervision over subsidiary banks in various countries. The procedure envisaged in

the SSM whereby each of the countries, including the countries participating in the Banking

Union on a close cooperation basis, holds an equal vote would apply to the process of making


decisions in that respect. If a given member state disagreed with any un-

favourable decision by the Supervisory Board on the establishment of the

liquidity subgroup and that decision was not overruled by the Governing

Council, the only way to avoid the consequences of such an unfavourable

decision would be to terminate close cooperation. The risk of that mecha-

nism being used seems negligible. Considering the potential implications,

both reputational and for the entire financial system of the country

involved, of such a move as well as the fact that the country terminating

close cooperation may not rejoin the Banking Union until three years have

passed, it seems unlikely that the parties would fail to resolve any potential

dispute without resorting to termination of close cooperation.

Although constituting an effective safeguard, the aforementioned solution

can hardly be perceived as the desired solution. When acceding to the Banking

Union, no country should foresee exiting it as a result of a decision-making

conflict. Hence, every country considering engagement in close coopera-

tion should strive to arrange its relations with ECB and ESM in such man-

ner that no decision affecting that country and resulting in that country

requiring support unavailable to it is made prior to the country in question

becoming eligible to use the safeguards available to the euro area countries.

Neither can it be ruled out altogether that for some countries member-

ship in the Banking Union will contribute to enhancing effectiveness and

conservatism of their supervision. It is common knowledge that the super-

visory approaches adopted are not uniform and may vary from country to

country, with some countries being more effective than others in their supervisory efforts. It

is not clear whether the approaches by individual countries will be revised or not and, if so,

whether they would shift towards the least or the most conservative model. There is also

a possibility that a mixed approach will be selected. This decision will be of relevance to the

supervisory authorities displaying more conservatism than the EU average.

”The critical argument against joining the eurozone is that you can’t exit it when you need to. The paradox is that only countries that are in a safe situation could easily leave the eurozone. If they wanted to, they could do so without sending shock waves across their economies. Meanwhile, countries in dire need of their own currencies cannot exit the eurozone safely.“

Stefan KawalecPresident of the Management Board, Capital Strategy


SPEECHES AND DEBATES


ZPLENARY DEBATES DEBATE PARTNER DEBATY

It is Worth Being Part of the Eurozone - Oxford-style debate

Will the Energy Union Improve Securityin Europe?

PKN ORLEN S.A., PGE Polska Grupa Energetyczna S.A.

Capital Markets Union and the Integration of the European Financial Market

PKO Bank Polski

Without Immigrants Europe Is Doomed to Fail - Oxford-style debate

British Alumni Society

Announcement of key Recommendations of the European Financial Congress 2015

ZDISCUSSION PANELSTW DEBATE PARTNER DEBATY

What Bank Branches Do Today's Clients Need?Evolution Patterns of Bank Branch Networks in the Lightof Changing Client Expectations.

Deloitte

How to Use the Capital Market to Finance Research and Development?

Industrial Development Agency JSC, Bank Gospodarstwa Krajowego, Warsaw Stock Exchange

Growth Prospects for the Mortgage Loan Market Bank Pekao S.A.

The Future of Infrastructure Sectors NDI S.A.

SPEECHES AND PRESENTATIONS

Moral Hazard on Financial MarketsMarek Belka, President of the National Bank of Poland

Merits and Demerits of Introducing the EuroMateusz Szczurek, Minister of Finance of Poland

Union or Discord – Does a Single Currency Need a Single Economic Policy?HSH Prince Michael von Liechtenstein, Chairman, Geopolitical Information Service AG

How to Fix the Eurozone?Jacek Rostowski, f. Deputy Prime Minister and Minister of Finance of Poland in 2007-2013


The European Energy Union.Compromise for Growth and Good Energy

PKN ORLEN S.A.

Digital Consumers, their Preferences and Trends- Challenges, Effect on the Financial Services Sector

KPMG

The Role of Innovation in Value-Based Management Energa S.A., EY

How Will the Capital Markets Union Impact the Development of Capital Markets in Europe?

Warsaw Stock Exchange, Central Securities Depository of Poland

Models of Financing and Managing Innovation and Reindustrialisation Projects for Strategic Companies

PGE Polska Grupa Energetyczna S.A., Dziennik Gazeta Prawna

Long-Term Savings or Consumption Growth - What Basis for Economic Development?

Deloitte, Izba Gospodarcza Towarzystw Emerytalnych

How Much Innovation Can the Polish Banking Industry Bear?

MasterCard

How to Test the Resilience of Banks to Shocks? Citi Handlowy, Polityka Insight

How to Adapt the Economy to CO2 Emissions Standards? Benefits and Opportunities, Costs and Threats.

GAZ System, NDI S.A.

Low Level of Savings - a Barrier to the Development of the Financial Sector and the Economy?

EY, PKO Bank Polski

How to Gain Customer Insight and Put It to Good Use? Accenture

Bank Resolution – Progress and Challenges Bank Guarantee Fund

Legal Security for Entrepreneurs Dziennik Gazeta Prawna

Can Banks Satisfy Everyone? EY

Fragmentation or Defragmentation? - Cooperation between the SSM and non-SSM National Supervision Authorities

EY, Polish FinancialSupervision Authority

Is This the Last Boom of Such Scale? Is the Model forPoland’s Economic Development Exhausted after thePresent Boom, and Are We Threatened by a Significant,Permanent Slowdown?

Bank Pekao S.A.

Is a World of Low Interest Rates Safe? PKO Bank Polski, The Boston Consulting Group


How to Enhance Relations between Majority and Minority Investors?

KPMG, Warsaw Stock Exchange

Financing with Corporate Bonds vs. Bank Financing.A Supplement or an Alternative?

Bank Pekao S.A.

Managing the Risks Caused by Climate Change - Challenges Faced by Public Administration, Cities and the Insurance Industry

Ministry of the Environment

Financial Indices – Regulatory Requirements vs. Practical Challenges

Institute for Market Economics, EY

CLOSED DEBATES, MEETINGSAND ACCOMPANYING EVENTSTW DEBATE PARTNER DEBATY

Financing Models in Revitalisation of Urban Space – How to Eliminate Barriers?

City of Sopot

How to Reduce Short-Termismand Strengthen the Need of Long-Term Thinking?

KGHM Polska Miedź S.A.

Breakfast of Renowned Woman Experts MasterCard

What’s Next for Bancassurance in Poland?

Cyber Security & Cyber Crime – Challenges for the Polish Financial Sector

Premiere of the book “Challenges of retail banking” ed. Zbigniew Jagiełło

Stock Exchange as a Means for Reducing Barriers to theDevelopment of Family-Owned Enterprises in the Areasof Succession, Professionalisation and Growth?

Warsaw Stock Exchange, Baker & McKenzie

Repairing the EU Banking System - the Pathway to Financial Integration

European Banking Authority

Announcement of the results of the Minister of the Environment contest "Design: Eco-Exterior”

Ministry of the Environment

Culture @ Man @ Economy Narodowe Centrum Kultury, Instytut Adama Mickiewicza, Regina Purpurea Fundus


EFC ACADEMY

DEBATE "What would we change in Europe?"

MEETINGS AND DISCUSSIONS WITH LEADERS:

Jan Krzysztof Bielecki, Chairman of the European Financial Congress Programme BoardZbigniew Jagiełło, President of the Management Board, PKO Bank PolskiSławomir Jędrzejczyk, Vice President of the Management Board, PKN Orlen S.A. Maciej Koński CEO, Strategic Analyses and Raw Material Deposits Centre,KGHM Polska MiedźMateusz Morawiecki, President of the Management Board, Bank Zachodni WBK Andrzej Tersa, President of the Management Board, ENERGA S.A.

WORKSHOP SESSIONS HOSTED BY:

Bank Zachodni WBK and Biznes po LudzkuEYKGHM Polska Miedź S.A.Polish Association of Listed Companies

MEETING WITH LECH WAŁĘSA IN THE EUROPEAN SOLIDARITY CENTRE

DEBATE "Gdańsk - northen European Business Hub - development, opportunity and ambition"in the Olivia Business Centre


DIRECTORS 29%

REPRESENTATIVES OF UNIVERSITIES

16%

OTHER

11%

MEMBERS OF MANAGEMENT AND SUPERVISORY BOARDS

37%

REPRESENTATIVES OF LOCAL

AND CENTRAL GOVERNMENTS 7%

StatisticsPARTICIPANTS BY POSITIONSNUMBER OF PARTICIPANTS - 1488

CONSULTING AND

LEGAL SERVICES

12%

FUELS AND POWER INDUSTRY

7%

IT AND INNOVATIONS

4%

MEDIA

12%

BANKING, CAPITAL MARKET AND INSURANCE INDUSTRY

27%

INFRASTRUCTURE AND CONSTRUCTION INDUSTRY

5%

RESEARCH AND HIGHER EDUCATION

16%

CENTRAL AND LOCAL

ADMINISTRATION

7%

OTHER

6%

NON-GOVERNMENTAL

ORGANISATIONS

4%

StatisticsPARTICIPANTS BY INDUSTRY SECTORSNUMBER OF PARTICIPANTS - 1488



PICTURE GALLERY


ORGANIZERS

AND PARTNERS


C O - O R G A N I Z E R S


P A R T N E R S

M A I N P A R T N E R S


I N S T I T U T I O N A L P A R T N E R S


M A I N M E D I A P A R T N E R S

M E D I A P A R T N E R S

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