Historical outline

90-plus years on the market

The story of PKO Bank Polski is inextricably woven into modern history of Poland. The institution that stands for dependability and safety for several generations of Poles came into existence in the early months of the Second Commonwealth of Poland.
Still is one of the foremost banks in this country, the Bank offers its customers modern financial services through: a branch network of over 1,200; an agency network of nearly 2,000 outlets operating under the Bank brand; and round the clock and every day of the year via the Internet and telephone. PKO Bank Polski also runs the country?s biggest ATM network of over 2,300 machines.

Peer to the Second Commonwealth of Poland

Through a decree issued on 8 February 1919 the Chief of State Józef Piłsudski established Pocztowa Kasa Oszczędności (PKO), the PKO Bank Polski antecedent institution.
Built along the lines of the postal bank model then adopted across Europe, PKO was vested with the mission of organising the country?s personal savings system, processing money orders and cheques, buying and selling state securities and encashment of bills of exchange.
PKO reported to the minister ? postmaster and the chief telegraph master while its employees had the status of civil servants.
PKO?s success in the interwar years was that it structured a system that facilitated accumulation of savings in various forms, conditioned the society to the use of banking services and sought to attract to PKO substantial part of the cash funds until then hoarded in home cashboxes. Fulfilment of those plans was initially hindered by lack of a domestic currency (Polish złoty was ultimately introduced in April 1924) and high inflation prevailing in the initial years following the First World War.
In 1925 average deposits per one savings book ranged between 153 and 213 złotys. Those most interested in saving with PKO included respectively: clerks and members of the military (18.9 per cent. of all savings books); craftsmen and workmen (14.6 per cent.); representatives of the professions (13 per cent.), schooled youth and children saving with the School Savings Unions (12.3 per cent.). The number of new savings books grew in step with public trust to PKO. In 1928 their number stood at 180,000 while by 1939 it reached 3,400,000.
Its base of collected savings (w 1938 r. reaching 800 million złotys) ranked PKO in the leading position among all Polish banks. This enable the Bank to engage in investment projects of national significance. The funds collected in PKO were indirectly applied (through purchase of state treasury securities) towards financing, among others, of: housing development; building of roads, bridges and railway lines; and of the largest scale investment projects of the revived Polish republic, including the Gdynia city and the port; the river dams in Porąbka and Rożnów; and the Central Industrial Region.

War and occupation

In the summer of 1939 the holders of savings books and checking accounts ? alarmed by the mounting tensions in the Polish-German relations ? began to violently withdraw funds from their accounts. Under such conditions, the cash emergency funds of PKO proved insufficient to cover the ongoing requests for withdrawal. Bank Polski stepped in with a support credit line to PKO.
In the early days of the war PKO branches, one by one, we evacuated to the east. To some extent they continued their counter services while some of the bank transports were confiscated by the advancing units of the Soviet Army. The German occupiers allowed PKO to conduct bank counter services, but on a severely limited scale.
Through that war ? from the unsuccessful evacuation of branches in September 1939 to the Warsaw Uprising - PKO incurred massive losses. It was not just the documents and office equipment that were destroyed, but also most of the Bank?s real estate in Warsaw. There were heavy casualties among the personnel of the Bank.

Raise from the ruins

As early as in January 1945 the Treasury Ministry drafted a scheme for reorganisation of the Polish banking sector. However, the then compiled list of banks to be revived did not include Pocztowa Kasa Oszczędności. Meanwhile the employees of PKO spontaneously proceeded with safeguarding the remnants of its assets and undertook efforts toward resumption of its operations. Numerous memoranda and petitions were sent and ultimately heeded. In April 1945 the Minister of the Treasury issued a directive on the reopening of PKO. The management was initially headquartered in Cracow.
The revived PKO sought to reconstruct the model of operation adopted in its pre-war years. However, it was no longer the bank management, but the ministry officials and the Polish United Workers' Party set PKO?s key policy directions. The banking reform decree promulgated in 1948, among others, provided Pocztowa Kasa Oszczędności with a new name of Powszechna Kasa Oszczędności.

From a credit union to a bank

In spite of the name change, in popular opinion no break in continuity of this largest Polish savings institution occurred. For majority of its customers and employees Powszechna Kasa Oszczędności was the direct continuator of Pocztowa Kasa Oszczędności.
Interest in the saving mechanisms know from the pre-war years gradually returned and grew. When in 1946 PKO serviced only 6,000 savings books, three years later it handled 270,000. The currency reform of 1950 further consolidated trust in the PKO institution as savings deposits held in it were converted to the new złotys at the rate of 100:3 while the population?s cash funds were converted at a much less attractive rate of 100:1.
PKO gradually developed own branch network, yet it continued to process bulk of its operation via the postal service outlets. Scope of its operations was still restricted to acceptance of savings deposits from the Poles and passing them on the state treasury, in the form of deposits. Only in 1972 was PKO authorised to grant cash loans to individuals. In 1974 it serviced nearly 32 million savings books and expanded its product offer to include the savings and checking account (ROR) for individuals.
In 1975 came another turning point in its history, when PKO was merged with the structures of the National Bank of Poland (NBP). The fact that some of the NBP branches retained the PKO name or that separate divisions in NBP continued the operations of the former PKO does not mean that Powszechna Kasa Oszczędności continued its existence over that period, in some, be it vestigial, form.
Reactivation came in 1987, with grading of the articles of association to the Bank by resolution of the Council of Ministers of September 7th, which stated that ?PKO is a savings and loans and currency bank serving natural and legal persons, business ?units of socialised economy?, including the co-operative housing sector, and business ?units of non-socialised economy?". PKO took over from NBP a network of 345 banking outlets and 120 sub-branches, 6,671 School Savings Unions, and it was provided with 23,300 full time jobs. The liabilities side was then dominated by savings of individuals (90. 2 per cent.) while the asset side by loans granted to housing co-operatives (47.5 per cent.).

Transforming with the economy

The Bank adjusted very rapidly to the new free market conditions, in which it began operating from the year 1989 onwards. The new articles of association granted it in 1992 use for the first time the name Powszechna Kasa Oszczędności ? Bank Państwowy (and PKO BP as the shortened form).
In the following year the first Supervisory Board of PKO Bank Polski was appointed. In its membership it included representatives of the National Bank of Poland, the Ministry of Finance and of the Bank?s employees. In its activity, the new corporate governance body followed the generally applicable rules stipulated by the Commercial Companies Act.
By the end of 1993 the Bank operated nearly 1,000 branches and sub-branches, or more than 20 per cent. of bank branch network then in existence in Poland. It ranked among the top three Polish banks.
In 1999 its customers were offered a series of new products, such as the Superkonto savings and checking account (immediately recognised as the best product in its class in the market), the Graffiti Konto Młodych and Superkonto Student accounts and various deposit products.
Its internet information portal launched in 1997, the Bank offered e-banking services to its customers three years later.
In step with product offer expansion, the Bank built out its branch network as it supplemented its operational capacities through a mass rollout of ATM installations. Its first ATM came on line in September 1990, at the 10th Warsaw Branch. PKO Bank Polski very rapidly took the market lead in the number of served individual and institutional accounts, and the number of issued payment cards. It is also an invariable leader in the sale of loan products.

Top of the league

Transformation of the Bank into a wholly-owned subsidiary of the State Treasury operating under the name of PKO Bank Polski Spółka Akcyjna (a joint stock company) was a watershed event. Entry into the commercial register on 12 April 2000 also marked the commencement of the Bank?s preparations for initial public offering of its stock. Generally lauded a major success, the floatation took place on 10 November 2004.
The implementation of the integrated IT system in years 2005-2008 was another major challenge the newly listed bank faced. The project was the largest and the most rapidly executed exercise of its kind among the financial institutions in Poland. It resulted in all of the Bank?s branches and 50 per cent. of its agency outlets operating in a uniform IT environment.
Today PKO Bank Polski is a universal deposit taking and lending bank, which serves individuals, small enterprises, large companies and major corporations, central and local government institutions, and various other entities. It offers all of them the traditional fixed and variable rate deposits in the local currency as well as foreign currencies. The Bank?s retail offer includes savings accounts, saving insurance policies, and deposits combined with mutual fund investments. PKO Bank Polski is also one of the few in the market that provides customers with an integrated access to their securities brokerage account with their bank account. Through this service customers can, among others, actively engage in buying and selling of all of the financial instruments traded on the Warsaw Stock Exchange, e.g. equities, bonds or futures and options. The customers can also invest in mutual fund products directly from their bank accounts, via the Bank?s internet platform.
PKO Bank Polski also engages in treasury and capital investment activities, and has expanded internationally: to Ukraine, where it has operated since 2004; and to the United Kingdom, where it opened its first London outlet in December 2007. Contributing to achievement of its core business goals are the entities forming the PKO Bank Polski Capital Group .

Facing the future

Implementations of innovative solutions have added to PKO Bank Polski?s strength and market positioning. In January 2010 the Bank was the first in the country to proceed with the operation of replacing all of its traditional magnetic stripe technology Visa debit cards (issued to individual holders) with Visa smart cards featuring a microchip and the supplementary contactless Visa payWave function. Distribution of the new cards began in September 2010.
The Bank launched the first enhanced automatic teller machine with a functionality that facilitates its use by the blind and the visually impaired. The special ATM is installed in Laski near Warsaw, in the vicinity of the Róża Czacka Academy for the Blind operated by the Blind Welfare Association. Equipped with a headset, the machine lends itself to voice operation and has an embossed Braille alphabet touchpad. Further plans envisage rollout of the solution to other ATMs.
From mid-November 2010 the Bank expanded the network of ATMs its customers can use on free-of-charge basis. The customers can use over 1,000 BZ WBK ATMs, in addition the 2,400 Bank?s proprietary machines operated by eService, a PKO Bank Polski Capital Group company.
The Bank is the first in its home market to provide clients with the new electronic depository safe drop offs, which permit booking of the deposited funds within 30 minutes of their deposit time. By the end of 2011 the Bank will have put on line over 80 such depository drops.
As envisaged in the strategy, the Bank will also focus on systematic development of the Internet enabled services. In the year 2010 it has began an in-depth refreshment of its Inteligo brand, with the ultimate goal of growing Inteligo into the largest internet bank in Poland.