The situation of the Polish non-banking sector

Investment fund sector

In 2014, a slow-down was recorded on the domestic investment fund market compared with 2013. The increase in the assets of investment funds in 2014 was approx. 51% lower than in 2013, and the net inflows of new funds were approx. 60% lower than in 2013. This was influenced by a smaller appetite for risk on the part of investors under the conditions of the weak situation on the WSE (an increase in the WIG index y/y of 0.3% y/y compared with an increase of 8.1% in 2013), the drop in profitability on the debt market, and the historically low level of the basic interest rates.

In 2014, the assets of the domestic investment funds increased by approx. PLN 21.1 billion (+11.2% y/y) to PLN 208.9 billion compared with an increase of PLN 41.6 billion (+28.4%) in 2013. This was the result of the positive balance of new funds inflow (PLN 12.6 billion) accompanied by a decrease in valuation (approx. PLN 6.1 billion). In 2014, the net inflow of new funds was approx. 2.5-times lower than in 2013.

In 2014, the strongest net inflow was recorded by cash and money funds as well as debt funds regarded as being the safest.
Net outflow was recorded by the domestic shares funds.

The weakening of situation on the investment fund market in 2014 caused that fund units have been a weaker competition for retail deposits than in 2013, which affected the structure of household savings. In 2014 the investment fund market received the net inflow of individuals’ funds in the amount by 30% lower than in 2013. The downturn on the investment funds market affected non-interest income of banks participating in distribution of the investment fund’s units.

Open pension fund market

In 2014, the situation on the open pension fund market (OPF) was significantly influenced by regulatory changes concerning the principles for the payment of pensions out of the funds accumulated in OPFs, including those relating to the obligatory transfer of 51.5% of the open pension funds’ assets to the Social Insurance Institution (ZUS) in February 2014, a reduction in the contributions transferred by ZUS to OPFs from 3.1% to 2.92% of an insured person’s gross remuneration, a ban on investing funds in Treasury bonds, and setting new investment limits. The results of investment policy for OPFs were affected by the weak situation on the WSE (the WIG index increased of 0.3% y/y compared with an increase of 8.1% y/y in 2013). The development of the OPF market was positively influenced by the improvement in the situation on the labour market (a drop in unemployment and an increase in disposable household income).

In 2014, OPFs’ assets decreased by more than one half (-PLN 150.2 billion compared with an increase of 10.5% y/y in 2013) and as at the end of 2014, amounted to PLN 149.1 billion.

The increase in the number of OPFs’ members recorded in 2014 was slower than in 2013 (+244 thousand persons compared with +471 thousand persons in 2013). As at the end of 2014, the number of OPSs’ members was 16.6 million.

The lease market

In 2014, there was more dynamic growth on the lease market than in 2013. The value of assets financed by lease firms increased in 2014 by 21.3% y/y to PLN 42.8 billion (compared with an increase of 13% in 2013).

Leasing of vehicles had the greatest positive effect on the lease market development (an increase in financed value of assets of 27.7% y/y to PLN 26.5 billion). Significant growth was also recorded in leasing of machinery and equipment (17.7% y/y to PLN 13.5 billion). The structure of the market was still dominated by leasing of movable properties constituting 97.1% (as at the end of 2013 – 95.4%).

In 2014 leasing market operated in an improvement of economic situation, including strong investment demand and tax changes, including the write-off of VAT from buying cars with heavy truck type-approval.

The factoring market

In 2014, the factoring market grew slightly more dynamic than in 2013. The turnover of factoring firms in 2014 increased by approx. 17% y/y compared to the growth by about 16% in 2013.

In 2014 the factoring sector has recorded an increase in demand for services. The number of customers increased by 15.9% y/y and the number of debtors of the factoring firms that belong to the Polish Factors Association increased by 19.5% y/y.