In December 2019, the Polish Financial Supervision Authority (“PFSA”) published position statements on the assumptions underlying the 2020 dividend policy of the following entities:

  • banks (commercial, co-operative and affiliating),

  • insurance and reinsurance companies,

  • brokerage houses,

  • investment fund management companies, and

  • universal pension funds.

Who will be able to distribute dividends for 2019?

PFSA’s standpoints are essentially consistent with its position statements concerning the assumptions of the 2019 dividend policy. Additional criteria have only been introduced in relation to:

  • brokerage houses - PFSA recommends that, when making decisions concerning the amount of dividends, brokerage houses take into account costs associated with implementation of regulations defining prudential requirements for investment firms (IFR and IFD),

  • investment fund management companies (“TFI”) – PFSA has set an additional criterion relating to the requirement concerning TFI’s liquid assets, which results from the provisions of the Polish Act on Employee Capital Plans,

  • universal pension funds (“PTE”) – PFSA recommends that, while deciding on the distribution of profit, the PTE should take into account additional capital needs associated with managing defined date funds (in accordance with the Polish Act on Employee Capital Plans), as well as the needs related to the implementation of legislative changes planned for 2020 that concern the Polish pension market.

Why does the PFSA publish position statements concerning the dividend policy of financial institutions?

PFSA’s position statements concerning the dividend policy of financial market entities are soft-law measures. Their objective is to ensure that financial system in Poland develops sustainably and safely. In practice, financial institutions in Poland act in line with PFSA’s position statements.