6. Operating segments
Data reported in the section stem from the application of the management model (‘Model’) in which the main criterion for segmentation is the classification of customers based on their profile and service model.
Reporting and monitoring of results, for managerial purposes, include all components of the income statement up to the gross profit level. Therefore, the income from the segment’s activities as well as operating costs related to those activities (including direct and allocated costs in line with the allocation model applied) and other components of income statement are attached to each segment.
The Group settles transactions between segments on an arm’s length basis by applying current market prices. Fund transfers between retail, private, corporate and investment banking segments, and the assets and liabilities management and other area are based on market prices applicable to the funds’ currency and maturity, including liquidity margins.
Operating segments
The operating segments of the Group are as follows:
- Retail banking – all banking activities related to retail customers (excluding private banking customers) and micro companies with annual turnover not exceeding PLN 5 million, as well as results of the subsidiaries, and shares in net profit of associates accounted for usingthe equity method, that are assigned to the retail banking activity,
- Private banking – all banking activities related to the most affluent individual customers,
- Corporate and Investment banking – all banking activities related to large companies and results of the subsidiaries that are assigned to the Corporate and Investment banking activity,
- Enterprise banking – all banking activities related to the companies with annual turnover form PLN 5 milion to PLN 100 million and below 5 million in the case of companies conducting full accounting,
- Assets and Liabilities management and other – supervision and monitoring of fund transfers, interbank market, debt securities and other instrumnets, other activities centrally managed as well as the results of subsidiaries and share in net profit of associates accounted for using the equity method thta are not assigned to other reported segments.
Operating segemnts reporting for the period from 1 January to 31 December 2021
| RETAIL BANKING | PRIVATE BANKING | CORPORATE AND INVESTMENT BANKING | ENTERPRISE BANKING | ASSETS & LIABILITIES MANAGEMENT AND OTHER | TOTAL | |
| External interest income | 2,650,304 | 4,367 | 1,268,152 | 446,158 | 1,501,375 | 5,870,356 |
| External interest expenses | -42,093 | -9,632 | -84,401 | -3,665 | -69,804 | -209,595 |
| Net external interest income | 2,608,211 | -5,265 | 1,183,751 | 442,493 | 1,431,571 | 5,660,761 |
| Internal interest income | 527,194 | 39,715 | 47,218 | 33,423 | -647,550 | – |
| Internal interest expenses | -847,988 | -7,504 | -409,556 | -172,884 | 1,437,932 | – |
| Net internal interest income | -320,794 | 32,211 | -362,338 | -139,461 | 790,382 | – |
| Total net interest income | 2,287,417 | 26,946 | 821,413 | 303,032 | 2,221,953 | 5,660,761 |
| Fee and commision income and expense | 1,132,582 | 180,630 | 688,936 | 677,076 | 8,291 | 2,687,515 |
| Other non-interest income | -21,981 | -1,971 | 113,268 | 43,090 | 41,468 | 173,874 |
| Operating income | 3,398,018 | 205,605 | 1,623,617 | 1,023,198 | 2,271,712 | 8,522,150 |
| Personnel expenses | -871,143 | -80,479 | -222,357 | -194,161 | -787,916 | -2,156,056 |
| Other administrative expenses | -1,187,935 | -31,988 | -173,417 | -259,146 | 717,730 | -934,756 |
| Depreciation and amortisation | -203,326 | -16,939 | -21,232 | -18,247 | -388,474 | -648,218 |
| Operating costs | -2,262,404 | -129,406 | -417,006 | -471,554 | -458,660 | -3,739,030 |
| Gross operating profit | 1,135,614 | 76,199 | 1,206,611 | 551,644 | 1,813,052 | 4,783,120 |
| Net allowances for expected credit losses | -469,335 | 3,531 | -158,345 | -95,064 | -58,985 | -778,198 |
| Net operating profit | 666,279 | 79,730 | 1,048,266 | 456,580 | 1,754,067 | 4,004,922 |
| Guarantee funds charges | -293,574 | -801 | -175,793 | -73,462 | 254,323 | -289,307 |
| Tax on certain financial institutions | -718,923 | -718,923 | ||||
| Gains (losses) on associates | 4,928 | 4,928 | ||||
| Profit before tax | 372,705 | 78,929 | 872,473 | 383,118 | 1,294,395 | 3,001,620 |
| Income tax expenses | -825,062 | |||||
| Net profit for the period | 2,176,558 | |||||
| Attributable to equity holders of the Bank | 2,174,897 | |||||
| Attributable to non-controlling interests | 1,661 | |||||
| Allocated asstes | 81,977,783 | 1,181,934 | 69,573,607 | 22,076,233 | 56,318,496 | 231,128,053 |
| Unallocated assets | 19,438,552 | |||||
| Total assets | 250,566,605 | |||||
| Allocated liabilities | 113,039,944 | 16,009,347 | 47,619,296 | 27,576,094 | 8,167,204 | 212,411,885 |
| Unallocated liabilities | 14,291,434 | |||||
| Total liabilities | 226,703,319 |
Operating segments reporting for the period from 1 January to 31 December 2020
| RETAIL BANKING | PRIVATE BANKING | CORPORATE AND INVESTMENT BANKING | ENTERPRISE BANKING | ASSETS & LIABILITIES MANAGEMENT AND OTHER | TOTAL | |
| External interst income | 3,007,177 | 5,740 | 1,437,324 | 428,925 | 970,193 | 5,849,359 |
| External interest expenses | -251,371 | -100,568 | -183,942 | -27,666 | -83,800 | -647,347 |
| Net external income | 2,755,806 | -94,828 | 1,253,382 | 401,259 | 886,393 | 5,202,012 |
| Internal interest income | 747,836 | 129,044 | 206,046 | 86,990 | -1,169,916 | – |
| Internal interest expenses | -1,245,252 | -6,078 | -552,336 | -183,317 | 1,986,983 | – |
| Net internal interest income | -497,416 | 122,966 | -346,290 | -96,327 | 817,067 | – |
| Total net interest income | 2,258,390 | 28,138 | 907,092 | 304,932 | 1,703,460 | 5,202,012 |
| Fee and commission income and expense | 1,098,612 | 167,043 | 518,866 | 577,505 | 71,624 | 2,433,650 |
| Other non-interest income | -13,085 | -1,359 | 106,040 | 40,800 | 27,837 | 160,233 |
| Operating income | 3,343,917 | 193,822 | 1,531,998 | 923,237 | 1,802,921 | 7,795,895 |
| Personnel expenses | -854,365 | -74,339 | -220,550 | -169,006 | -721,606 | -2,039,866 |
| Other administrative expenses | -1,130,816 | -26,059 | -146,922 | -247,020 | 678,663 | -872,154 |
| Depreciation and amortisation | -180,787 | -12,190 | -28,851 | -8,420 | -308,703 | -538,951 |
| Operating costs | -2,165,968 | -112,588 | -396,323 | -424,446 | -351,646 | -3,450,971 |
| Gross operating profit | 1,177,949 | 81,234 | 1,135,675 | 498,791 | 1,451,275 | 4,344,924 |
| Net allowances for expected credit losses | -720,852 | -2,936 | -351,769 | -525,998 | 23,095 | -1,578,460 |
| Net operating profit | 457,097 | 78,298 | 783,906 | -27,207 | 1,474,370 | 2,766,464 |
| Guarantee funds charges | -289,519 | -754 | -181,367 | -65,400 | 156,181 | -380,859 |
| Tax on certain financial institutions | -660,590 | -660,590 | ||||
| Profit before tax | 167,578 | 77,544 | 602,539 | -92,607 | 969,961 | 1,725,015 |
| Income tax expense | -622,114 | |||||
| Net profit for the period | 1,102,901 | |||||
| Attributable to equity holders of the Bank | 1,101,712 | |||||
| Attributable to non-controlling interests | 1,189 | |||||
| Allocated assets | 79,409,665 | 1,059,615 | 61,044,256 | 17,614,067 | 57,451,207 | 216,578,810 |
| Unallocated assets | 16,638,372 | |||||
| Total Assets | 233,217,182 | |||||
| Allocated liabilities | 102,997,958 | 17,220,235 | 44,358,463 | 28,264,807 | 5,015,281 | 197,856,744 |
| Unallocated liabilities | 9,865,461 | |||||
| Total Liabilities | 207,722,205 |
Reconciliation of operating income for reportable segments
| 2021 | 2020 | |
|---|---|---|
| Net interest income | 5,660,761 | 5,202,012 |
| Net fee and commission income | 2,687,515 | 2,433,650 |
| Dividend income | 26,662 | 26,278 |
| Result on financial assets and liabilities measured at fair value through profit or loss and foreign exchange result | 129,845 | 170,539 |
| Result on fair value hedge accounting | 3,704 | -847 |
| Profit (loss) from derecognition of financial assets and financial liabilities not at fair value through profit or loss | 29,863 | 61,132 |
| Operating income | 8,538,350 | 7,892,764 |
| Other operating income | 121,546 | 68,180 |
| Other operating expenses | -137,746 | -165,049 |
| Total operating income for reportable segments | 8,522,150 | 7,795,895 |