PKO Bank Hipoteczny specialises in mortgage loans for individual clients. Based on our strategic relationship with our parent, PKO Bank Polski, these loans are offered to retail clients through Poland’s largest network of branches, intermediaries and agencies.
PKO Bank Hipoteczny’s key task is the issuance of covered bonds, which constitute the primary source of long-term financing of loans granted by the Bank that are secured by property.
Establishing a mortgage bank is one of the elements of the PKO Bank Polski Group’s strategy. PKO Bank Hipoteczny’s functional concept is based on operational integration with the parent bank. Its goal is to achieve maximum synergies within the PKO Group, meaning optimal use of the Group’s assets and know-how.
During PKO Bank Hipoteczny’s licensing procedure before Poland’s Financial Supervision Authority, PKO Bank Polski, the founder and sole shareholder, pledged that if the mortgage lender’s liquidity or capital adequacy ratios fall below the level required by the regulations, the parent bank will immediately provide it with the necessary level of financing.
PKO Bank Hipoteczny’s main purpose is to secure long-term financing by issuing covered bonds, a type of bond secured by mortgage loans that is one of the world’s safest financial instruments. Covered bonds’ high level of safety directly affects their price, which allows the Group to finance itself at a lower cost than that of issuing unsecured bonds.
PKO Bank Hipoteczny’s issue of covered bonds also allows the PKO Bank Polski Group to free up liquidity and capital, and thus to increase lending. The use of covered bonds to finance mortgage lending also increases the Group’s financial safety by partially eliminating the mismatch between the maturity structure of assets and liabilities.