May 26, 2022

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ING Bank President Śląski: We must follow an anti-inflation policy

ING Bank President Śląski: We must follow an anti-inflation policy

Let’s help Ukraine – you can help too

economic inflation It is the biggest economic challenge (…) We do not have a coherent program to address anti-inflation policyWe are sending many signals that inflation is not only inevitable, but its increase is inevitable,” Bronon Barkowitz said at the press conference dedicated to presenting the bank’s results for the first quarter of this year.

– It is necessary to fight the signals of uncertainty, to eliminate those that could (…) When war broke out, there were a lot of these signals (…) In my opinion, they have little to do with the management of a continent calm inflationary tensions – added.

When Russia invaded Ukraine on February 24, people rushed to withdraw money from banks. They converted it into dollars and euros, for which you had to pay up to 5 PLN at the beginning of March. And they took her outside. This panic is over now. According to unconfirmed estimates so far, at its peak, people paid almost 100 billion PLN from banks.

We were dealing with the situation panic. The number and volume of transactions was huge, comparable, but greater than the situation related to the outbreak of the epidemic – said Pronon Bartkevich.

– Cash withdrawals panic behind us – he added.

The panic is over, but the hot money still burns your hands. There was an excess of money in the banks and Deposit interest rates rises slowly. Instead of bank deposits, people are looking to invest their money in something that will increase the value.
They speed up purchasing decisions, as well as loan repayments, including mortgage.

– We are still increasing the value cash withdrawalsWhich may no longer have the character of panic and take cash abroad, but is caused by a scheme of hot money – said Bronnon Barkowitz.

The level of unpredictability is increasing in the economy and in The banking sector – added.

Since the beginning of the year, the demand for MortgagesPeople are also paying what they have already incurred for fear of higher interest rates. At ING BŚK, prepayments for mortgage loans are twice that Before inflation breaks out and rates rise.

– This is a natural consequence of hot money – said the head of ING BŚK.

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Those who decide to take out a mortgage are increasingly choosing a fixed rate, although, of course, it does not cover the entire repayment period. At ING BŚK, fixed rate mortgages accounted for 64 percent in April. Total sales and their share in the bank’s total portfolio increased to 14%. The head of ING BŚK claims that the fixed rate is a few points or several basis points higher than the variable rate. ING BŚK claims that despite the increase in interest rates, mortgage loan repayments have not deteriorated.

– Pronun Bartkevich said that talking about millions of people who are unable to pay their loans is a profound violation.

The head of the bank added that the institution positively evaluated the proposals of Prime Minister Mateusz Morawiecki to help borrowers. Let us remember that it includes the increase and flexibility of the support fund, which consists of banks, the deferment of the payment of one installment every quarter and the substitution of the WIBOR rate, which is the basis of the interest rate on loans, for a different and slightly lower order, but it is not yet known why.

– The proposal of the Prime Minister eliminates the unpredictability of the economic and monetary authorities in this regard to a large extent (…) but we do not know the details (…) Perhaps the demand for the fund (supporting borrowers) will be much greater than before (…) The endowment raises doubts about its purpose. It is proposed not to try to add money to those who do not need it (…) We are in favor of reducing the social consequences for the people most affected (high inflation and interest rates) – said Bronon Bartkevich.

From the proposals made by the Prime Minister, it is still not known what interest rate will be replaced by WIBOR, which is included in all variable rate loan agreements. Banks fear that the government may decide to freeze the rate of WIBOR, which would severely hurt interest income.

– they change Webor It is an expected change, but we consider it highly unjustified to question the current WIBOR – he said.

ING BŚK representatives believe that there is a noticeable increased competition for banks in the market, both for deposits and loans, despite the fact that interest margins for the sector in the first quarter rose sharply due to higher interest rates.

The value of mortgage loans in the ING BŚK portfolio in the first quarter of this year increased by only 1%, and cash loans by 1%. He fell. The interest result increased to PLN 1.7 billion, i.e. 49%. Compared to the first quarter of last year, net profit was 792.8 million PLN, or 106 per cent.

Jacek Ramotovsky

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