Although a new acts about Cooperative Credit Unions has not been implemented yet, a project of its novelization has already been created. This tremendous work of the parliamentarians of the Civic Platform shows how much they want to reduce the property law of over two million of Poles

If it is not known what it is all about, it is about money – this old Polish saying perfectly shows the truth about the sector of financial services in our country. Maintaining state institutions, which should care about savings of citizens and support competition in the financial sector, raises many question marks. Somebody must care about limiting the share in the market which has been being conquered successfully by Credit Unions for 20 years. And it is not possible to explain the situation in a different way when the politicians of the Civic Platform are planning to change the act before a law is implemented which has been written by them before.

Such a feverish fight against Credit Unions can be explained only in one way. – First of all, it is all about pleasing somebody and fulfilling tasks which are required from the Civic Platform by banking lobby which is governing in this party – thinks Jerzy Bielewicz, a financier and the chairman of the Association ‘friendly market’. Limiting of the activity of Credit Unions lies in the interests of big banking corporations. For, in uncertain times of crisis the Credit Unions turned out to be a safe alternative for banks. – For 20 years no single Credit Union went bankrupt and no member of the Credit Unions lost a zloty; whereas at the same time many banks have already gone bankrupt which were under the state supervision – reminds Grzegorz Bierecki, a chairman of the National Cooperative Credit Union.

Bankers from the Civic Platform

The political fight against the Credit Unions started in 2009 when the parliamentarians from the Civic Platform enforced passing of the novelized act about cooperative saving and credit unions. The legislative process of this new law has already passed into history as a project which has become famous by the biggest number of complaints to the Constitutional Tribunal. President Lech Kaczynski questioned 72 articles of the new act. However, BronisŁaw Komorowski decided to change the decision of his tragically deceased predecessor and withdrew 70 articles from the Constitutional Tribunal (the two remaining turned out to be non-constitutional). This July President Komorowski signed the famous act about credit unions, according to which, they are to be submitted to the Commission of Financial Supervision. And although the new law will be binding not earlier than after 27 October, the parliamentarians of the Civic Platform have already prepared the novelization of this act. They want to change its 80 regulations. Who stands behind this legislative over-zealousness? The answer is not explicit because nobody signed the project. Its authors are figuring under the enigmatic name ‘a group of the parliamentarians of the Civic Platform’. So, it remains only to guess that it is about politicians who have been related with a strong banking fraction in the Civic Platform. So far the projects of the acts about the credit unions were being supported by, among the others, Jakub Szulc (the previous worker of the Bank BPH), Sławomir Neumann (a holiday worker of the Bank Nordea) and the former MP of the Civic Platform JarosŁaw Urbaniak (the former worker Invest Bank). Let’s not forget that also prominent people in the Civic Platform, like Jan Krzysztof Bielecki or Andrzej Olechowski are connected with the banking sector. As a result, the law created by the governing party is written in such a way as if its authors were the bank chairmen, who want to hinder the outflow of their clients to the credit unions.

The project of the act novelization which got to the Seym on 26 July 2012, is created under the dictation of the banking sector which in the times of economical crisis hardly makes the ends meet. What is more, it is being done under noble slogans of ‘raising stability’ or ‘improving the safety’ of credit unions clients. – However, it is all about money of Polish savers who are missing in the banks today so much – emphasizes Janusz Szewczak, the main economist of the credit unions.

Expropriation of members?

The administration of the National credit union has often emphasized that it is not afraid of the Commission of Financial Supervision, but its objections raise a possibility of pressures on the commission. It is has been known for a long time that the nominations to the Commission of Financial Supervision are conducted according to a political key. The concern is justified indeed because when one looks at the project of the act novelization, which assumes unlimited possibilities of intervening into the credit unions. In many places the supervision over the credit unions would be going further than in the case of banks. – the Commission of Financial Supervision can decide in strictly economic issues, like, for example, signing contracts about the cooperation with other subjects, about establishing and abolishing administration, and even it could decide about the change of the owner – explains professor Adam Jedliński, a chairman of the National Supervising Council of the credit unions. The rights of members and cooperative administrations would be limited to minimum. Nearly all important decisions must be agreed with the Commission of Financial Supervision. – According to this proposal, the Commission of Financial Supervision could even introduce the receivership administration and attach the credit union to an ordinary commercial bank. However, on the base of the constitution it is completely impossible – assures Jedliński.

The project of the act novelization is so absurd that – according to the chairman of the credit unions – there is no chance for it to be implemented in practice. Its creators might have meant something completely different. – In this way they want to cause a state of legal uncertainty around the credit unions and discouragement of potential clients who could become the members of the cooperative unions. It takes place during a media campaign lasting around Amber Gold. In this way it is suggested that savings are safe only in banks. It can be considered as actions strengthening the capital position of banks – points out Grzegorz Bierecki. He also reminds that most banks functioning in Poland are the property of the foreign capital. Many of them are evaluated by international ratings agencies as institutions of very low safety – they have very low investment evaluations and are nearly on the verge of the rubbish-like evaluation.

So, there is a danger of drainage of money abroad. Even the European Union warned us against the transfer of the capital from banks-daughters functioning in our country to banks-mothers in the Western Europe. – The Commission of Financial Supervision is stubbornly concentrated on the credit unions, trying to change them into banks, not knowing that Poland is endangered by the escape of the capital from banks controlled by other countries and functioning of financial pyramids – thinks dr Cezary Mech who was one of the initiators of the establishment of the Commission of Financial Supervision.

The victims of a success

It can be said that the credit unions are the victims of their own success. The political campaign against them would not be so aggressive if Poles were not transferring their savings into the credit unions massively. Besides, a similar phenomenon is also seen in other countries, but with the difference that cooperative movement is supported there, not discriminated.

Big financial corporations were compromising in the eyes of clients when it turned out that banks take the responsibility for a vast part of the crisis. The so-called credit unions were in a completely different situation (in Poland known under the name of the credit unions). Not only are they resistant to the crisis, but they turned out to be a safety in the times when one bank went bankrupt after another. – Therefore, the project of this act is astonishing, and the governing politicians proved again that cooperative movement is not appreciated in our country – emphasizes Jerzy Jankowski, a chairman of the General Congregation of the National Cooperative Council. What is interesting, the politicians of the Civic Platform are attacking the credit unions in 2012 which was proclaimed by the United Nations Organization a Year of Cooperative Movement. Governments all over the world prove the merits of the cooperative movement and benefits for economy and development of the civil society and in Poland there are attempts to eliminate them.

In hard times, a key for success are not commercial institutions but cooperative institutions where a client is also their co-owner. For cooperative movement has one important advantage, which matches two opposite human features – economic selfishness and sensitivity to another man. The credit unions can offer such attractive conditions for their members because the benefits which banks must return in a form of dividend to their owners, the credit unions can return them to their clients in the form of, for example, the most beneficial rate or a better credit offer. Thanks to it, they have similar financial services to banks but much cheaper.

Credit unions have always offered their products to not rich people and from small towns; whereas banks have always concentrated on rich clients from big cities who could be persuaded into rich products. Now, when financial institutions are counting every penny, the situation has got changed.

At present in Cooperative Saving and Credit Unions there are 2.5 million Poles and their assets exceed 15 milliard zlotys. The first half a year of 2012 was a record when 212 thousand members joined the credit unions. So, the legislative initiative of ‘the group of MPs of the Civic Platform’ is an answer to this tendency. The extra supervision and many other restrictions and burdens may cause higher costs of the cooperative activity, that is, also a worse offer of credit unions, which undoubtedly would influence negatively the pockets of Poles, and it might also hinder the process of massive transferring savings from banks into credit unions. For it turns out, that for the mysterious ‘group of parliamentarians’ the business of banks is probably more important than healthy competition in the market and the welfare of Polish families.


"Niedziela" 37/2012

Editor: Tygodnik Katolicki "Niedziela", ul. 3 Maja 12, 42-200 Czestochowa, Polska
Editor-in-chief: Fr Jaroslaw Grabowski • E-mail: redakcja@niedziela.pl