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ING Bank Śląski S.A. Group has compiled the annual report in line with the best global practices of integrated reporting. To help readers use the interactive tools, we prepared a user guide with key features. We encourage you to watch a short animated video before reading the report.

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Integrated Annual Report
of ING Bank Śląski S.A. 2019

Income statement

katowice_ing_01-2020_rk_0769 katowice_ing_01-2020_rk_0769
 Change currency: PLNEURUSD
Consolidated income statement for the year ended 31 December
Note 2019 2018
Interest income, including: 2
2019 2018
Interest income, including: 5 280.1 4 673.8
Interest income calculated using effective interest rate method, including: 5 276.0 4 668.5
Interest on financial instruments measured at amortized cost 4 841.9 4 272.7
interest on loans and receivables to other banks measured at amortised cost 42.0 36.4
interest on loans and receivables to customers measured at amortised cost 4 539.9 3 955.7
interest on securities measured at amortised cost 260.0 280.6
Interest on securities measured at fair value through other comprehensive income 434.1 395.8
Other interest income, including: 4.1 5.3
interest on loans and receivables to other banks measured at fair value through profit or loss 4.1 5.3
Interest expense, including: 986.2 914.5
interest on deposits from other banks 58.3 58.3
interest on deposits from customers 891.1 835.5
interest on issue of debt securities 9.8 7.6
interest on subordinated liabilities 19.7 13.1
Interest on lease liabilities* 7.3 n/a
Net interest income 4 293.9 3 759.3

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

5 280.1 4 673.8
Interest income calculated using effective interest rate method 2
2019 2018
Interest income, including: 5 280.1 4 673.8
Interest income calculated using effective interest rate method, including: 5 276.0 4 668.5
Interest on financial instruments measured at amortized cost 4 841.9 4 272.7
interest on loans and receivables to other banks measured at amortised cost 42.0 36.4
interest on loans and receivables to customers measured at amortised cost 4 539.9 3 955.7
interest on securities measured at amortised cost 260.0 280.6
Interest on securities measured at fair value through other comprehensive income 434.1 395.8
Other interest income, including: 4.1 5.3
interest on loans and receivables to other banks measured at fair value through profit or loss 4.1 5.3
Interest expense, including: 986.2 914.5
interest on deposits from other banks 58.3 58.3
interest on deposits from customers 891.1 835.5
interest on issue of debt securities 9.8 7.6
interest on subordinated liabilities 19.7 13.1
Interest on lease liabilities* 7.3 n/a
Net interest income 4 293.9 3 759.3

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

5 276.0 4 668.5
Other interest income 2
2019 2018
Interest income, including: 5 280.1 4 673.8
Interest income calculated using effective interest rate method, including: 5 276.0 4 668.5
Interest on financial instruments measured at amortized cost 4 841.9 4 272.7
interest on loans and receivables to other banks measured at amortised cost 42.0 36.4
interest on loans and receivables to customers measured at amortised cost 4 539.9 3 955.7
interest on securities measured at amortised cost 260.0 280.6
Interest on securities measured at fair value through other comprehensive income 434.1 395.8
Other interest income, including: 4.1 5.3
interest on loans and receivables to other banks measured at fair value through profit or loss 4.1 5.3
Interest expense, including: 986.2 914.5
interest on deposits from other banks 58.3 58.3
interest on deposits from customers 891.1 835.5
interest on issue of debt securities 9.8 7.6
interest on subordinated liabilities 19.7 13.1
Interest on lease liabilities* 7.3 n/a
Net interest income 4 293.9 3 759.3

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

4.1 5.3
Interest expenses 2
2019 2018
Interest income, including: 5 280.1 4 673.8
Interest income calculated using effective interest rate method, including: 5 276.0 4 668.5
Interest on financial instruments measured at amortized cost 4 841.9 4 272.7
interest on loans and receivables to other banks measured at amortised cost 42.0 36.4
interest on loans and receivables to customers measured at amortised cost 4 539.9 3 955.7
interest on securities measured at amortised cost 260.0 280.6
Interest on securities measured at fair value through other comprehensive income 434.1 395.8
Other interest income, including: 4.1 5.3
interest on loans and receivables to other banks measured at fair value through profit or loss 4.1 5.3
Interest expense, including: 986.2 914.5
interest on deposits from other banks 58.3 58.3
interest on deposits from customers 891.1 835.5
interest on issue of debt securities 9.8 7.6
interest on subordinated liabilities 19.7 13.1
Interest on lease liabilities* 7.3 n/a
Net interest income 4 293.9 3 759.3

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

986.2 914.5
Net interest income 2
2019 2018
Interest income, including: 5 280.1 4 673.8
Interest income calculated using effective interest rate method, including: 5 276.0 4 668.5
Interest on financial instruments measured at amortized cost 4 841.9 4 272.7
interest on loans and receivables to other banks measured at amortised cost 42.0 36.4
interest on loans and receivables to customers measured at amortised cost 4 539.9 3 955.7
interest on securities measured at amortised cost 260.0 280.6
Interest on securities measured at fair value through other comprehensive income 434.1 395.8
Other interest income, including: 4.1 5.3
interest on loans and receivables to other banks measured at fair value through profit or loss 4.1 5.3
Interest expense, including: 986.2 914.5
interest on deposits from other banks 58.3 58.3
interest on deposits from customers 891.1 835.5
interest on issue of debt securities 9.8 7.6
interest on subordinated liabilities 19.7 13.1
Interest on lease liabilities* 7.3 n/a
Net interest income 4 293.9 3 759.3

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

4 293.9 3 759.3
Commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 389.7 363.2
account maintenance fees 295.6 286.9
lending commissions 317.8 297.5
payment and credit cards fees 351.9 271.4
participation units distribution fees 74.5 99.6
insurance product offering commissions 135.5 109.5
factoring and lease agreements commissions 53.3 57.5
brokerage activity fees 20.1 21.4
fiduciary and custodian fees* 28.2 29.3
foreign commercial business 36 35.1
agency in financial instruments transactions 6.2 13.4
other commision 41.1 30.8
related to assets / liabilities not measured at fair value through profit and loss account 4.8 0.6
other 36.3 30.2
Total comission income 1 749.9 1 615.6
Commission expenses
card fees paid 204.7 155.4
commission paid on intermediation in selling deposit products 54.8 45.7
brokerage activity fees 15.3 14.9
commission paid on disclosing credit information 16.6 16.2
commission paid on cash handling services 20.9 20.7
electronic banking services fees 12.3 12.7
commission paid on trading in securities 8.8 8.4
costs of the National Clearing House (KIR) 11.3 10.1
agency in financial instruments transactions 2 7.5
lease agreements fees 2.9 1
other commision 28.6 18.1
related to assets / liabilities not measured at fair value through profit and loss account 7 6.2
other 21.6 11.9
Total commision expenses 378.2 310.7
Net commission income 1 371.7 1 304.9

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

1 749.9 1 615.6
Commission expenses 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 389.7 363.2
account maintenance fees 295.6 286.9
lending commissions 317.8 297.5
payment and credit cards fees 351.9 271.4
participation units distribution fees 74.5 99.6
insurance product offering commissions 135.5 109.5
factoring and lease agreements commissions 53.3 57.5
brokerage activity fees 20.1 21.4
fiduciary and custodian fees* 28.2 29.3
foreign commercial business 36 35.1
agency in financial instruments transactions 6.2 13.4
other commision 41.1 30.8
related to assets / liabilities not measured at fair value through profit and loss account 4.8 0.6
other 36.3 30.2
Total comission income 1 749.9 1 615.6
Commission expenses
card fees paid 204.7 155.4
commission paid on intermediation in selling deposit products 54.8 45.7
brokerage activity fees 15.3 14.9
commission paid on disclosing credit information 16.6 16.2
commission paid on cash handling services 20.9 20.7
electronic banking services fees 12.3 12.7
commission paid on trading in securities 8.8 8.4
costs of the National Clearing House (KIR) 11.3 10.1
agency in financial instruments transactions 2 7.5
lease agreements fees 2.9 1
other commision 28.6 18.1
related to assets / liabilities not measured at fair value through profit and loss account 7 6.2
other 21.6 11.9
Total commision expenses 378.2 310.7
Net commission income 1 371.7 1 304.9

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

378.2 310.7
Net commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 389.7 363.2
account maintenance fees 295.6 286.9
lending commissions 317.8 297.5
payment and credit cards fees 351.9 271.4
participation units distribution fees 74.5 99.6
insurance product offering commissions 135.5 109.5
factoring and lease agreements commissions 53.3 57.5
brokerage activity fees 20.1 21.4
fiduciary and custodian fees* 28.2 29.3
foreign commercial business 36 35.1
agency in financial instruments transactions 6.2 13.4
other commision 41.1 30.8
related to assets / liabilities not measured at fair value through profit and loss account 4.8 0.6
other 36.3 30.2
Total comission income 1 749.9 1 615.6
Commission expenses
card fees paid 204.7 155.4
commission paid on intermediation in selling deposit products 54.8 45.7
brokerage activity fees 15.3 14.9
commission paid on disclosing credit information 16.6 16.2
commission paid on cash handling services 20.9 20.7
electronic banking services fees 12.3 12.7
commission paid on trading in securities 8.8 8.4
costs of the National Clearing House (KIR) 11.3 10.1
agency in financial instruments transactions 2 7.5
lease agreements fees 2.9 1
other commision 28.6 18.1
related to assets / liabilities not measured at fair value through profit and loss account 7 6.2
other 21.6 11.9
Total commision expenses 378.2 310.7
Net commission income 1 371.7 1 304.9

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

1 371.7 1 304.9
Net income on financial instruments at fair value through profit or loss and FX result 4
2019 2018
FX result  and net income on interest rate derivatives, including: 46.4 35.7
FX result 68.4 114.6
currency derivatives -22.0 -78.9
Net income on interest rate derivatives 39.4 36.1
Net income on debt instruments held for trading 22.4 19.0
Result on measurement of loans to customers which are measured at fair value through profit or loss 0.1 0.1
Net income on financial instruments at fair value through profit or loss and FX result 108.3 90.9

Net income on debt instruments includes net income on trading in treasury securities and money market instruments (treasury bills) as well as result on fair value measurement of those instruments.

Net income on derivatives includes net income on trading and fair value measurement of IR derivatives (FRA, IRS/CIRS, cap options), FX derivatives (swaps and options) as well as stock exchange index options.

108.3 90.9
Net income on the sale of securities measured at amortised cost 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 1.0
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 36.3 54.3
sale of debt securities 29.3 48.0
dividend income 7.0 6.3

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

0.0 1.0
Net income on the sale of securities measured at fair value through other comprehensive income and dividend income 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 1.0
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 36.3 54.3
sale of debt securities 29.3 48.0
dividend income 7.0 6.3

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

36.3 54.3
Net (loss)/income on hedge accounting 6
2019 2018
Fair value hedge accounting for securities: 8.2 10.9
valuation of the hedged transaction 34.3 129.5
valuation of the hedging transaction -26.1 -118.6
Cash flow hedge accounting: -22.5 -3.0
ineffectiveness under cash flow hedges -22.5 -3.0
Net income on hedge accounting -14.3 7.9

 

-14.3 7.9
Net (loss)/income on other basic activities 7
2019 2018
Sale of other services 13.8 16.1
Net income on disposal of property, plant and equipment and intangible assets -0.2 -1.6
Banking activity-related compensations and losses -3.0 -5.4
Provision for commission refunds for early loan repayments -1.1 0.0
Other 0.4 5.3
Total -6.1 14.4
-6.1 14.4
Net income on basic activities 5 789.8 5 232.7
General and administrative expenses 8
2019 2018
Personnel expenses, including: 1 202.6 1 104.7
wages and salaries, including: 985.2 902.4
variable remuneration programme 34.2 33.3
ING Group’s incentive programme 0.2 0.3
retirement benefits 3.7 3.6
employee benefits 217.4 202.3
Cost of marketing and promotion 119.4 118.1
Depreciation and amortisation, including: 276.8 193.5
on property, plant and equipment 198.7 117.1
including depreciation of the right to use * 96.8 n/a
on intangible assets 7.1 76.4
Other general and administrative expenses, including: 898.6 910.5
IT costs 221.3 196.2
communication costs 51.0 51.1
transport and representation costs 37.0 46.7
maintenance, refurbishment and rental of buildings* n/a 197.2
maintenance and refurbishment of buildings* 100.0 n/a
costs of short-term leasing and low-value leasing * 22.0 n/a
obligatory Bank Guarantee Fund payments 202.3 165.2
advisory and legal services, audit costs 90.0 91.8
donations 5.0 3.9
disputed claims 0.6 12.0
other 169.4 146.4
Total 2 497.4 2 326.8

*Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data. As a result of implementation, the costs of long-term rental were allocated to depreciation and interest costs, while the costs of short-term rental were moved to the line: Costs for short-term leasing and leasing of low-value assets. The costs of maintaining buildings present the costs associated with the maintenance and administration of real estate, as well as non-leasing elements not included in the calculation of the leasing liability, including VAT.

2 497.4 2 326.8
Impairment for expected losses 9
2019 2018
Investment securities -1.6 4.7
at fair value through other comprehensive income -0.8 3.2
measured at amortized cost -0.8 1.5
Loans and other receivables measured at amortized cost 577.7 481.4
corporate banking 268.0 217.9
including corporate and municipal securities 0.0 -0.2
retail banking 309.7 263.5
Provisions for off-balance sheet liabilities 29.4 14.8
Total 605.5 500.9

 

Balance of impairment 2019 2018
Investment securities 5.6 7.2
at fair value through other comprehensive income 4.0 4.8
measured at amortized cost 1.6 2.4
Loans and other receivables measured at amortized cost 2 481.3 2 270.0
corporate banking 1 355.3 1 261.5
including corporate and municipal securities 0.6 0.5
retail banking 1 126.0 1 008.5
other receivables 0.0 0.0
Provisions for off-balance sheet liabilities 107.1 78.5
Total 2 594.0 2 355.7

* The values presented under the item Loans and other receivables measured at amortised cost cover i.a. repayments under previously derecognised liabilities which in 2019 were PLN 0.9 million (PLN 2.4 million in 2018).

605.5 500.9
including profit on sale of receivables 34.3 26.7
Tax on certain financial institutions 10

Persuant to the Act on Tax on Certain Financial Institutions the Group is obliged to pay the bank levy being 0.0366% of assets per month. The tax base is the sum of assets less PLN 4 billion and the value of own funds and treasury securities. For 2019, the tax totalled PLN 435.7 million (PLN 373.8 million for 2018).

435.7 373.8
Share of profit/(loss) of associates accounted for using the equity method 6.6 -0.3
Gross profit 2 257.8 2 030.9
Income tax 59.1 50.1
Net profit 1 658.7 1 523.8
– attributable to shareholders of ING Bank Śląski S.A. 1 658.7 1 523.8
– attributable to non-controlling interests 0.0 0.0
Net profit attributable to shareholders of ING Bank Śląski S.A. 1 658.7 1 523.8
Weighted average number of ordinary shares 130 100 000 130 100 000
Earnings per ordinary share (PLN) 12.75 11.71

The diluted earnings per share are the same as the profit per one ordinary share.

The Consolidated Income Statement should be read in conjunction with the notes to the consolidated financial statements being the integral part thereof.

for the year ended 31 December
Note 2019 2018
Interest income, including: 2
2019 2018
Interest income, including: 1 227.4 1 095.4
Interest income calculated using effective interest rate method, including: 1 226.5 1 094.1
Interest on financial instruments measured at amortized cost 1 125.6 1 001.4
interest on loans and receivables to other banks measured at amortised cost 9.8 8.5
interest on loans and receivables to customers measured at amortised cost 1 055.3 927.1
interest on securities measured at amortised cost 60.4 65.8
Interest on securities measured at fair value through other comprehensive income 100.9 92.8
Other interest income, including: 1.0 1.2
interest on loans and receivables to other banks measured at fair value through profit or loss 1.0 1.2
Interest expense, including: 229.3 214.3
interest on deposits from other banks 13.6 13.7
interest on deposits from customers 207.1 195.8
interest on issue of debt securities 2.3 1.8
interest on subordinated liabilities 4.6 3.1
Interest on lease liabilities* 1.7 n/a
Net interest income 998.2 881.0

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1 227.4 1 095.4
Interest income calculated using effective interest rate method 2
2019 2018
Interest income, including: 1 227.4 1 095.4
Interest income calculated using effective interest rate method, including: 1 226.5 1 094.1
Interest on financial instruments measured at amortized cost 1 125.6 1 001.4
interest on loans and receivables to other banks measured at amortised cost 9.8 8.5
interest on loans and receivables to customers measured at amortised cost 1 055.3 927.1
interest on securities measured at amortised cost 60.4 65.8
Interest on securities measured at fair value through other comprehensive income 100.9 92.8
Other interest income, including: 1.0 1.2
interest on loans and receivables to other banks measured at fair value through profit or loss 1.0 1.2
Interest expense, including: 229.3 214.3
interest on deposits from other banks 13.6 13.7
interest on deposits from customers 207.1 195.8
interest on issue of debt securities 2.3 1.8
interest on subordinated liabilities 4.6 3.1
Interest on lease liabilities* 1.7 n/a
Net interest income 998.2 881.0

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1 226.5 1 094.1
Other interest income 2
2019 2018
Interest income, including: 1 227.4 1 095.4
Interest income calculated using effective interest rate method, including: 1 226.5 1 094.1
Interest on financial instruments measured at amortized cost 1 125.6 1 001.4
interest on loans and receivables to other banks measured at amortised cost 9.8 8.5
interest on loans and receivables to customers measured at amortised cost 1 055.3 927.1
interest on securities measured at amortised cost 60.4 65.8
Interest on securities measured at fair value through other comprehensive income 100.9 92.8
Other interest income, including: 1.0 1.2
interest on loans and receivables to other banks measured at fair value through profit or loss 1.0 1.2
Interest expense, including: 229.3 214.3
interest on deposits from other banks 13.6 13.7
interest on deposits from customers 207.1 195.8
interest on issue of debt securities 2.3 1.8
interest on subordinated liabilities 4.6 3.1
Interest on lease liabilities* 1.7 n/a
Net interest income 998.2 881.0

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1.0 1.2
Interest expenses 2
2019 2018
Interest income, including: 1 227.4 1 095.4
Interest income calculated using effective interest rate method, including: 1 226.5 1 094.1
Interest on financial instruments measured at amortized cost 1 125.6 1 001.4
interest on loans and receivables to other banks measured at amortised cost 9.8 8.5
interest on loans and receivables to customers measured at amortised cost 1 055.3 927.1
interest on securities measured at amortised cost 60.4 65.8
Interest on securities measured at fair value through other comprehensive income 100.9 92.8
Other interest income, including: 1.0 1.2
interest on loans and receivables to other banks measured at fair value through profit or loss 1.0 1.2
Interest expense, including: 229.3 214.3
interest on deposits from other banks 13.6 13.7
interest on deposits from customers 207.1 195.8
interest on issue of debt securities 2.3 1.8
interest on subordinated liabilities 4.6 3.1
Interest on lease liabilities* 1.7 n/a
Net interest income 998.2 881.0

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

229.3 214.3
Net interest income 2
2019 2018
Interest income, including: 1 227.4 1 095.4
Interest income calculated using effective interest rate method, including: 1 226.5 1 094.1
Interest on financial instruments measured at amortized cost 1 125.6 1 001.4
interest on loans and receivables to other banks measured at amortised cost 9.8 8.5
interest on loans and receivables to customers measured at amortised cost 1 055.3 927.1
interest on securities measured at amortised cost 60.4 65.8
Interest on securities measured at fair value through other comprehensive income 100.9 92.8
Other interest income, including: 1.0 1.2
interest on loans and receivables to other banks measured at fair value through profit or loss 1.0 1.2
Interest expense, including: 229.3 214.3
interest on deposits from other banks 13.6 13.7
interest on deposits from customers 207.1 195.8
interest on issue of debt securities 2.3 1.8
interest on subordinated liabilities 4.6 3.1
Interest on lease liabilities* 1.7 n/a
Net interest income 998.2 881.0

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

998.2 881.0
Commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 90.6 85.1
account maintenance fees 68.7 67.2
lending commissions 73.9 69.7
payment and credit cards fees 81.8 63.6
participation units distribution fees 17.3 23.3
insurance product offering commissions 31.5 25.7
factoring and lease agreements commissions 12.4 13.5
brokerage activity fees 4.7 5.0
fiduciary and custodian fees* 6.6 6.9
foreign commercial business 8.4 8.2
agency in financial instruments transactions 1.4 3.1
other commision 9.6 7.2
related to assets / liabilities not measured at fair value through profit and loss account 1.1 0.1
other 8.4 7.1
Total comission income 406.8 378.6
Commission expenses
card fees paid 47.6 36.4
commission paid on intermediation in selling deposit products 12.7 10.7
brokerage activity fees 3.6 3.5
commission paid on disclosing credit information 3.9 3.8
commission paid on cash handling services 4.9 4.9
electronic banking services fees 2.9 3.0
commission paid on trading in securities 2.0 2.0
costs of the National Clearing House (KIR) 2.6 2.4
agency in financial instruments transactions 0.5 1.8
lease agreements fees 0.7 0.2
other commision 6.6 4.2
related to assets / liabilities not measured at fair value through profit and loss account 1.6 1.5
other 5.0 2.8
Total commision expenses 87.9 72.8
Net commission income 318.9 305.8

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

406.8 378.6
Commission expenses 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 90.6 85.1
account maintenance fees 68.7 67.2
lending commissions 73.9 69.7
payment and credit cards fees 81.8 63.6
participation units distribution fees 17.3 23.3
insurance product offering commissions 31.5 25.7
factoring and lease agreements commissions 12.4 13.5
brokerage activity fees 4.7 5.0
fiduciary and custodian fees* 6.6 6.9
foreign commercial business 8.4 8.2
agency in financial instruments transactions 1.4 3.1
other commision 9.6 7.2
related to assets / liabilities not measured at fair value through profit and loss account 1.1 0.1
other 8.4 7.1
Total comission income 406.8 378.6
Commission expenses
card fees paid 47.6 36.4
commission paid on intermediation in selling deposit products 12.7 10.7
brokerage activity fees 3.6 3.5
commission paid on disclosing credit information 3.9 3.8
commission paid on cash handling services 4.9 4.9
electronic banking services fees 2.9 3.0
commission paid on trading in securities 2.0 2.0
costs of the National Clearing House (KIR) 2.6 2.4
agency in financial instruments transactions 0.5 1.8
lease agreements fees 0.7 0.2
other commision 6.6 4.2
related to assets / liabilities not measured at fair value through profit and loss account 1.6 1.5
other 5.0 2.8
Total commision expenses 87.9 72.8
Net commission income 318.9 305.8

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

87.9 72.8
Net commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 90.6 85.1
account maintenance fees 68.7 67.2
lending commissions 73.9 69.7
payment and credit cards fees 81.8 63.6
participation units distribution fees 17.3 23.3
insurance product offering commissions 31.5 25.7
factoring and lease agreements commissions 12.4 13.5
brokerage activity fees 4.7 5.0
fiduciary and custodian fees* 6.6 6.9
foreign commercial business 8.4 8.2
agency in financial instruments transactions 1.4 3.1
other commision 9.6 7.2
related to assets / liabilities not measured at fair value through profit and loss account 1.1 0.1
other 8.4 7.1
Total comission income 406.8 378.6
Commission expenses
card fees paid 47.6 36.4
commission paid on intermediation in selling deposit products 12.7 10.7
brokerage activity fees 3.6 3.5
commission paid on disclosing credit information 3.9 3.8
commission paid on cash handling services 4.9 4.9
electronic banking services fees 2.9 3.0
commission paid on trading in securities 2.0 2.0
costs of the National Clearing House (KIR) 2.6 2.4
agency in financial instruments transactions 0.5 1.8
lease agreements fees 0.7 0.2
other commision 6.6 4.2
related to assets / liabilities not measured at fair value through profit and loss account 1.6 1.5
other 5.0 2.8
Total commision expenses 87.9 72.8
Net commission income 318.9 305.8

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

318.9 305.8
Net income on financial instruments at fair value through profit or loss and FX result 4
2019 2018
FX result  and net income on interest rate derivatives, including: 46.4 35.7
FX result 68.4 114.6
currency derivatives -22.0 -78.9
Net income on interest rate derivatives 39.4 36.1
Net income on debt instruments held for trading 22.4 19.0
Result on measurement of loans to customers which are measured at fair value through profit or loss 0.1 0.1
Net income on financial instruments at fair value through profit or loss and FX result 108.3 90.9

Net income on debt instruments includes net income on trading in treasury securities and money market instruments (treasury bills) as well as result on fair value measurement of those instruments.

Net income on derivatives includes net income on trading and fair value measurement of IR derivatives (FRA, IRS/CIRS, cap options), FX derivatives (swaps and options) as well as stock exchange index options.

25.2 21.3
Net income on the sale of securities measured at amortised cost 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 0.2
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 8.4 12.7
sale of debt securities 6.8 11.2
przychody z tytułu dywidend 1.6 1.5

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

0.0 0.2
Net income on the sale of securities measured at fair value through other comprehensive income and dividend income 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 0.2
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 8.4 12.7
sale of debt securities 6.8 11.2
przychody z tytułu dywidend 1.6 1.5

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

8.4 12.7
Net (loss)/income on hedge accounting 6
2019 2018
Fair value hedge accounting for securities: 1,9 2,6
valuation of the hedged transaction 8,0 30,3
valuation of the hedging transaction -6,1 -27,8
Cash flow hedge accounting: -5,2 -0,7
ineffectiveness under cash flow hedges -5,2 -0,7
Net income on hedge accounting -3,3 1,9

 

-3.3 1.9
Net (loss)/income on other basic activities 7
2019 2018
Sale of other services 3.2 3.8
Net income on disposal of property, plant and equipment and intangible assets 0.0 -0.4
Banking activity-related compensations and losses -0.7 -1.3
Provision for commission refunds for early loan repayments -4.0 0.0
Other 0.1 1.2
Total -1.4 3.4
-1.4 3.4
Net income on basic activities 1 345.9 1 226.3
General and administrative expenses 8
2019 2018
Personnel expenses, including: 279.6 258.9
wages and salaries, including: 229.0 211.5
variable remuneration programme 8.0 7.8
ING Group’s incentive programme 0.0 0.1
retirement benefits 0.9 0.8
employee benefits 50.5 47.4
Cost of marketing and promotion 27.8 27.7
Depreciation and amortisation, including: 64.3 45.3
on property, plant and equipment 46.2 27.4
including depreciation of the right to use * 22.5 n/a
on intangible assets 18.2 17.9
Other general and administrative expenses, including: 208.9 213.4
IT costs 51.4 46.0
communication costs 11.9 12.0
transport and representation costs 8.6 10.9
maintenance, refurbishment and rental of buildings* n/a 46.2
maintenance and refurbishment of buildings* 23.2 n/a
costs of short-term leasing and low-value leasing * 5.1 n/a
obligatory Bank Guarantee Fund payments 47.0 38.7
advisory and legal services, audit costs 20.9 21.5
donations 1.2 0.9
disputed claims 0.1 2.8
other 39.4 34.3
Total 580.5 545.3

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data. As a result of implementation, the costs of long-term rental were allocated to depreciation and interest costs, while the costs of short-term rental were moved to the line: Costs for short-term leasing and leasing of low-value assets. The costs of maintaining buildings present the costs associated with the maintenance and administration of real estate, as well as non-leasing elements not included in the calculation of the leasing liability, including VAT.

580.5 545.3
Impairment for expected losses 9
2019 2018
Investment securities -0.4 1.1
at fair value through other comprehensive income -0.2 0.7
measured at amortized cost -0.2 0.4
Loans and other receivables measured at amortized cost 134.3 112.8
corporate banking 62.3 51.1
including corporate and municipal securities 0.0 0.0
retail banking 72.0 61.8
Provisions for off-balance sheet liabilities 6.8 3.5
Total 140.8 117.4

 

Balance of impairment 2019 2018
Investment securities 1.3 1.7
at fair value through other comprehensive income 0.9 1.1
measured at amortized cost 0.4 0.6
Loans and other receivables measured at amortized cost 582.7 527.9
corporate banking 318.3 293.4
including corporate and municipal securities 0.1 0.1
retail banking 264.4 234.5
other receivables 0.0 0.0
Provisions for off-balance sheet liabilities 25.1 18.3
Total 609.1 547.8

* The values presented under the item Loans and other receivables measured at amortised cost cover i.a. repayments under previously derecognised liabilities which in 2019 were PLN 0.9 million (PLN 2.4 million in 2018).

140.8 117.4
including profit on sale of receivables 8.0 6.3
Tax on certain financial institutions 10

Persuant to the Act on Tax on Certain Financial Institutions the Group is obliged to pay the bank levy being 0.0366% of assets per month. The tax base is the sum of assets less PLN 4 billion and the value of own funds and treasury securities. For 2019, the tax totalled PLN 435.7 million (PLN 373.8 million for 2018).

101.3 87.6
Share of profit/(loss) of associates accounted for using the equity method 1.5 -0.1
Gross profit 524.9 476.0
Income tax 139.3 118.8
Net profit 385.6 357.1
– attributable to shareholders of ING Bank Śląski S.A. 385.6 357.1
– attributable to non-controlling interests 0.0 0.0
Net profit attributable to shareholders of ING Bank Śląski S.A. 385.6 357.1
Weighted average number of ordinary shares 130 100 000 130 100 000
Earnings per ordinary share (PLN) 3.0 2.7

The diluted earnings per share are the same as the profit per one ordinary share.

The Consolidated Income Statement should be read in conjunction with the notes to the consolidated financial statements being the integral part thereof.

for the year ended 31 December
Note 2019 2018
Interest income, including: 2
2019 2018
Interest income, including: 1 373.6 1 290.1
Interest income calculated using effective interest rate method, including: 1 372.5 1 288.7
Interest on financial instruments measured at amortized cost 1 259.6 1 179.4
interest on loans and receivables to other banks measured at amortised cost 10.9 10.0
interest on loans and receivables to customers measured at amortised cost 1 181.1 1 091.9
interest on securities measured at amortised cost 67.6 77.5
Interest on securities measured at fair value through other comprehensive income 112.9 109.3
Other interest income, including: 1.1 1.5
interest on loans and receivables to other banks measured at fair value through profit or loss 1.1 1.5
Interest expense, including: 256.6 252.4
interest on deposits from other banks 15.2 16.1
interest on deposits from customers 231.8 230.6
interest on issue of debt securities 2.5 2.1
interest on subordinated liabilities 5.1 3.6
Interest on lease liabilities* 1.9 n/a
Net interest income 1 117.1 1 037.7

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1 373.,6 1 290.1
Interest income calculated using effective interest rate method 2
2019 2018
Interest income, including: 1 373.6 1 290.1
Interest income calculated using effective interest rate method, including: 1 372.5 1 288.7
Interest on financial instruments measured at amortized cost 1 259.6 1 179.4
interest on loans and receivables to other banks measured at amortised cost 10.9 10.0
interest on loans and receivables to customers measured at amortised cost 1 181.1 1 091.9
interest on securities measured at amortised cost 67.6 77.5
Interest on securities measured at fair value through other comprehensive income 112.9 109.3
Other interest income, including: 1.1 1.5
interest on loans and receivables to other banks measured at fair value through profit or loss 1.1 1.5
Interest expense, including: 256.6 252.4
interest on deposits from other banks 15.2 16.1
interest on deposits from customers 231.8 230.6
interest on issue of debt securities 2.5 2.1
interest on subordinated liabilities 5.1 3.6
Interest on lease liabilities* 1.9 n/a
Net interest income 1 117.1 1 037.7

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1 372.5 1 288.7
Other interest income 2
2019 2018
Interest income, including: 1 373.6 1 290.1
Interest income calculated using effective interest rate method, including: 1 372.5 1 288.7
Interest on financial instruments measured at amortized cost 1 259.6 1 179.4
interest on loans and receivables to other banks measured at amortised cost 10.9 10.0
interest on loans and receivables to customers measured at amortised cost 1 181.1 1 091.9
interest on securities measured at amortised cost 67.6 77.5
Interest on securities measured at fair value through other comprehensive income 112.9 109.3
Other interest income, including: 1.1 1.5
interest on loans and receivables to other banks measured at fair value through profit or loss 1.1 1.5
Interest expense, including: 256.6 252.4
interest on deposits from other banks 15.2 16.1
interest on deposits from customers 231.8 230.6
interest on issue of debt securities 2.5 2.1
interest on subordinated liabilities 5.1 3.6
Interest on lease liabilities* 1.9 n/a
Net interest income 1 117.1 1 037.7

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1.1 1.5
Interest expenses 2
2019 2018
Interest income, including: 1 373.6 1 290.1
Interest income calculated using effective interest rate method, including: 1 372.5 1 288.7
Interest on financial instruments measured at amortized cost 1 259.6 1 179.4
interest on loans and receivables to other banks measured at amortised cost 10.9 10.0
interest on loans and receivables to customers measured at amortised cost 1 181.1 1 091.9
interest on securities measured at amortised cost 67.6 77.5
Interest on securities measured at fair value through other comprehensive income 112.9 109.3
Other interest income, including: 1.1 1.5
interest on loans and receivables to other banks measured at fair value through profit or loss 1.1 1.5
Interest expense, including: 256.6 252.4
interest on deposits from other banks 15.2 16.1
interest on deposits from customers 231.8 230.6
interest on issue of debt securities 2.5 2.1
interest on subordinated liabilities 5.1 3.6
Interest on lease liabilities* 1.9 n/a
Net interest income 1 117.1 1 037.7

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

256.6 252.4
Net interest income 2
2019 2018
Interest income, including: 1 373.6 1 290.1
Interest income calculated using effective interest rate method, including: 1 372.5 1 288.7
Interest on financial instruments measured at amortized cost 1 259.6 1 179.4
interest on loans and receivables to other banks measured at amortised cost 10.9 10.0
interest on loans and receivables to customers measured at amortised cost 1 181.1 1 091.9
interest on securities measured at amortised cost 67.6 77.5
Interest on securities measured at fair value through other comprehensive income 112.9 109.3
Other interest income, including: 1.1 1.5
interest on loans and receivables to other banks measured at fair value through profit or loss 1.1 1.5
Interest expense, including: 256.6 252.4
interest on deposits from other banks 15.2 16.1
interest on deposits from customers 231.8 230.6
interest on issue of debt securities 2.5 2.1
interest on subordinated liabilities 5.1 3.6
Interest on lease liabilities* 1.9 n/a
Net interest income 1 117.1 1 037.7

The interest costs presented above relate to financial liabilities measured at amortized cost.

For impaired assets, interest income is calculated based on net exposure amounts, i.e. amounts that include write-offs for expected repayments.

In 2019, the amount of PLN 89.3 million represents interest income on financial assets for which impairment loss was recognised. In  2018, the amount reached PLN 70.3 million.

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data.

1 117.1 1 037.7
Commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 101.4 100.3
account maintenance fees 76.9 79.2
lending commissions 82.7 82.1
payment and credit cards fees 91.5 74.9
participation units distribution fees 19.4 27.5
insurance product offering commissions 35.3 30.2
factoring and lease agreements commissions 13.9 15.9
brokerage activity fees 5.2 5.9
fiduciary and custodian fees* 7.3 8.1
foreign commercial business 9.4 9.7
agency in financial instruments transactions 1.6 3.7
other commision 10.7 8.5
related to assets / liabilities not measured at fair value through profit and loss account 1.2 0.2
other 9.4 8.3
Total comission income 455.2 446.0
Commission expenses
card fees paid 53.3 42.9
commission paid on intermediation in selling deposit products 14.3 12.6
brokerage activity fees 4.0 4.1
commission paid on disclosing credit information 4.3 4.5
commission paid on cash handling services 5.4 5.7
electronic banking services fees 3.2 3.5
commission paid on trading in securities 2.3 2.3
costs of the National Clearing House (KIR) 2.9 2.8
agency in financial instruments transactions 0.5 2.1
lease agreements fees 0.8 0.3
other commision 7.4 5.0
related to assets / liabilities not measured at fair value through profit and loss account 1.8 1.7
other 5.6 3.3
Total commision expenses 98.4 85.8
Net commission income 356.8 360.2

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

 

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

455.2 446.0
Commission expenses 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 101.4 100.3
account maintenance fees 76.9 79.2
lending commissions 82.7 82.1
payment and credit cards fees 91.5 74.9
participation units distribution fees 19.4 27.5
insurance product offering commissions 35.3 30.2
factoring and lease agreements commissions 13.9 15.9
brokerage activity fees 5.2 5.9
fiduciary and custodian fees* 7.3 8.1
foreign commercial business 9.4 9.7
agency in financial instruments transactions 1.6 3.7
other commision 10.7 8.5
related to assets / liabilities not measured at fair value through profit and loss account 1.2 0.2
other 9.4 8.3
Total comission income 455.2 446.0
Commission expenses
card fees paid 53.3 42.9
commission paid on intermediation in selling deposit products 14.3 12.6
brokerage activity fees 4.0 4.1
commission paid on disclosing credit information 4.3 4.5
commission paid on cash handling services 5.4 5.7
electronic banking services fees 3.2 3.5
commission paid on trading in securities 2.3 2.3
costs of the National Clearing House (KIR) 2.9 2.8
agency in financial instruments transactions 0.5 2.1
lease agreements fees 0.8 0.3
other commision 7.4 5.0
related to assets / liabilities not measured at fair value through profit and loss account 1.8 1.7
other 5.6 3.3
Total commision expenses 98.4 85.8
Net commission income 356.8 360.2

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

 

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

98.4 85.8
Net commission income 3
2019 2018
Commission income, including:
transaction margin on currency exchange transactions 101.4 100.3
account maintenance fees 76.9 79.2
lending commissions 82.7 82.1
payment and credit cards fees 91.5 74.9
participation units distribution fees 19.4 27.5
insurance product offering commissions 35.3 30.2
factoring and lease agreements commissions 13.9 15.9
brokerage activity fees 5.2 5.9
fiduciary and custodian fees* 7.3 8.1
foreign commercial business 9.4 9.7
agency in financial instruments transactions 1.6 3.7
other commision 10.7 8.5
related to assets / liabilities not measured at fair value through profit and loss account 1.2 0.2
other 9.4 8.3
Total comission income 455.2 446.0
Commission expenses
card fees paid 53.3 42.9
commission paid on intermediation in selling deposit products 14.3 12.6
brokerage activity fees 4.0 4.1
commission paid on disclosing credit information 4.3 4.5
commission paid on cash handling services 5.4 5.7
electronic banking services fees 3.2 3.5
commission paid on trading in securities 2.3 2.3
costs of the National Clearing House (KIR) 2.9 2.8
agency in financial instruments transactions 0.5 2.1
lease agreements fees 0.8 0.3
other commision 7.4 5.0
related to assets / liabilities not measured at fair value through profit and loss account 1.8 1.7
other 5.6 3.3
Total commision expenses 98.4 85.8
Net commission income 356.8 360.2

The above list includes the following items relating to financial instruments that are not measured at fair value through profit or loss and which have not been included in the calculation of the effective interest rate:

  • revenues in the total amount of PLN 1 023.4 million from maintaining customer accounts, granting loans, payment and credit cards, factoring and leasing services (PLN 913.9 million in 2018),
  • costs in the total amount of PLN 298.3 million due to paid commission on cards, brokering the sale of deposit products, providing credit information, electronic banking and leasing services (PLN 237.2 million in 2018).

 

* Fiduciary and custodian fees show the commissions earned on custody services, where the Group keeps or invests assets for their clients.

356.8 360.2
Net income on financial instruments at fair value through profit or loss and FX result 4
2019 2018
FX result  and net income on interest rate derivatives, including: 12.1 9.9
FX result 17.8 31.6
currency derivatives -5.7 -21.8
Net income on interest rate derivatives 10.2 10.0
Net income on debt instruments held for trading 5.8 5.2
Result on measurement of loans to customers which are measured at fair value through profit or loss 0.0 0.0
Net income on financial instruments at fair value through profit or loss and FX result 28.2 25.1

Net income on debt instruments includes net income on trading in treasury securities and money market instruments (treasury bills) as well as result on fair value measurement of those instruments.

Net income on derivatives includes net income on trading and fair value measurement of IR derivatives (FRA, IRS/CIRS, cap options), FX derivatives (swaps and options) as well as stock exchange index options.

28.2 25.1
Net income on the sale of securities measured at amortised cost 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 0.3
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 9.4 15.0
sale of debt securities 7.6 13.2
przychody z tytułu dywidend 1.8 1.7

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

0.0 0.3
Net income on the sale of securities measured at fair value through other comprehensive income and dividend income 5
2019 2018
Net income on the sale of securities measured at amortised cost 0.0 0.3
Net income on sale of securities measured at fair value through other comprehensive income and dividend income, including: 9.4 15.0
sale of debt securities 7.6 13.2
przychody z tytułu dywidend 1.8 1.7

Dividend income received in 2019 and 2018 comes from entities whose shares the Group maintained in its portfolio as at 31 December 2019 and 31 December 2018, respectively.

9.4 15.0
Net (loss)/income on hedge accounting 6
2019 2018
Fair value hedge accounting for securities: 2.1 3.0
valuation of the hedged transaction 8.9 35.7
valuation of the hedging transaction -6.8 -32.7
Cash flow hedge accounting: -5.9 -0.8
ineffectiveness under cash flow hedges -5.9 -0.8
Net income on hedge accounting -3.7 2.2

 

-3.7 2.2
Net (loss)/income on other basic activities 7
2019 2018
Sale of other services 3.6 4.4
Net income on disposal of property, plant and equipment and intangible assets -0.1 -0.4
Banking activity-related compensations and losses -0.8 -1.5
Provision for commission refunds for early loan repayments -4.4 0.0
Other 0.1 1.5
Total -1.6 4.0
-1.6 4.0
Net income on basic activities 1 506.2 1 444.4
General and administrative expenses 8
2019 2018
Personnel expenses, including: 312.9 304.9
wages and salaries, including: 256.3 249.1
variable remuneration programme 8.9 9.2
ING Group’s incentive programme 0.1 0.1
retirement benefits 1.0 1.0
employee benefits 56.6 55.8
Cost of marketing and promotion 31.1 32.6
Depreciation and amortisation, including: 72.0 53.4
on property, plant and equipment 51.7 32.3
including depreciation of the right to use * 25.2 n/a
on intangible assets 20.3 21.1
Other general and administrative expenses, including: 233.8 251.3
IT costs 57.6 54.2
communication costs 13.3 14.1
transport and representation costs 9.6 12.9
maintenance, refurbishment and rental of buildings* n/a 54.4
maintenance and refurbishment of buildings* 26.0 n/a
costs of short-term leasing and low-value leasing * 5.7 n/a
obligatory Bank Guarantee Fund payments 52.6 45.6
advisory and legal services, audit costs 23.4 25.3
donations 1.3 1.1
disputed claims 0.2 3.3
other 44.1 40.4
Total 649.7 642.3

* Starting from 1 January 2019, the Group has implemented the new IFRS 16 Leasing standard. The Group applied a modified retrospective approach to its leasing contracts and did not transform comparative data. As a result of implementation, the costs of long-term rental were allocated to depreciation and interest costs, while the costs of short-term rental were moved to the line: Costs for short-term leasing and leasing of low-value assets. The costs of maintaining buildings present the costs associated with the maintenance and administration of real estate, as well as non-leasing elements not included in the calculation of the leasing liability, including VAT.

649.7 642.3
Impairment for expected losses 9
2019 2018
Investment securities -0.4 1.3
at fair value through other comprehensive income -0.2 0.9
measured at amortized cost -0.2 0.4
Loans and other receivables measured at amortized cost 150.3 132.9
corporate banking 69.7 60.1
including corporate and municipal securities 0.0 -0.1
retail banking 80.6 72.7
Provisions for off-balance sheet liabilities 7.6 4.1
Total 157.5 138.3

 

Balance of impairment 2019 2018
Investment securities 1.5 1.9
at fair value through other comprehensive income 1.1 1.3
measured at amortized cost 0.4 0.6
Loans and other receivables measured at amortized cost 653.4 603.8
corporate banking 356.9 335.5
including corporate and municipal securities 0.2 0.1
retail banking 296.5 268.2
other receivables 0.0 0.0
Provisions for off-balance sheet liabilities 28.2 20.9
Total 683.0 626.6

* The values presented under the item Loans and other receivables measured at amortised cost cover i.a. repayments under previously derecognised liabilities which in 2019 were PLN 0.9 million (PLN 2.4 million in 2018).

157.5 138.3
including profit on sale of receivables 8.9 7.4
Tax on certain financial institutions 10

Persuant to the Act on Tax on Certain Financial Institutions the Group is obliged to pay the bank levy being 0.0366% of assets per month. The tax base is the sum of assets less PLN 4 billion and the value of own funds and treasury securities. For 2019, the tax totalled PLN 435.7 million (PLN 373.8 million for 2018).

113.3 103.2
Share of profit/(loss) of associates accounted for using the equity method 1.7 -0.1
Gross profit 587.4 560.6
Income tax 155.9 140.0
Net profit 431.5 420.6
– attributable to shareholders of ING Bank Śląski S.A. 431.5 420.6
– attributable to non-controlling interests 0.0 0.0
Net profit attributable to shareholders of ING Bank Śląski S.A. 431.5 420.6
Weighted average number of ordinary shares 130 100 000 130 100 000
Earnings per ordinary share (PLN) 3.3 3.2

The diluted earnings per share are the same as the profit per one ordinary share.

The Consolidated Income Statement should be read in conjunction with the notes to the consolidated financial statements being the integral part thereof.

Basic consolidated income statement figures of the ING Bank Śląski S.A. Group for 2019 and changes vis-à-vis 2018 are presented in the table below.

 Change currency: PLNEURUSD
Basic consolidated income statement figures in analytical terms
2019 2018 2017 2016 2015 Chnage 2019 o 2018
PLN million mln %
Net interest income 4 293.9 3 759.3 3 389.4 2 953.4 2 467.1 534.6 14.2%
Net commission income 1 371.7 1 304.9 1 196.0 1 064.8 1 017.2 66.8 5.1%
One-off income* 0.0 0.0 11.9 189.6 100.5 0.0
Other revenue** 130.8 168.2 171.8 116.7 193.3 -37.4 -22.2%
Total revenue 5 796.4 5 232.4 4 769.1 4 324.5 3 778.1 564.0 10.8%
Operating costs 2 497.4 2 326.8 2 135.8 2 099.2 2 155.7 170.6 7.3%
including one-off costs* 0.0 0.0 0.0 12.2 163.8 0.0
Impairment losses and provisions 605.5 500.9 421.2 300.6 232.1 104.6 20.9%
Bank levy 435.7 373.8 330.1 280.2 0.0 61.9 16.6%
Gross financial result 2 257.8 2 030.9 1 882.0 1 644.5 1 390.3 226.9 11.2%
Income tax 599.1 507.1 478.9 391.4 263.2 92.0 18.1%
Net result attributable to non-controlling shareholders 0.0 0.0 0.0 0.1 0.1 0.0
Net financial result 1 658.7 1 523.8 1 403.1 1 253.0 1 127.0 134.9 8.9%
Adjusted net result* 1 658.7 1 523.8 1 393.5 1 109.3 1 162.7 134.9 8.9%

 

* Income: dividend of PLN 82.1 million from ING PTE in Q2 2015, income of PLN 18.4 million from the disposal of ING PTE shares in Q3 2015 and positive impact of PLN 189.6 million under the Visa Europe transaction in Q2 2016 and positive impact of PLN 11.9 million under the Visa Inc. transaction in Q2 2017; Costs: PLN 157.4 million of extraordinary contribution to BGF stemming from the SK Bank bankruptcy in Q4 2015, PLN 6.4 million of contribution to the Mortgage Support Fund in Q4 2015 and PLN 12.2 million of extraordinary contribution to BGF under the bankruptcy of the Cooperative Bank in Nadarzyn.

** Including the share in net profits of affiliated entities recognised on an equity basis.

Basic consolidated income statement figures in analytical terms
2019 2018 2017 2016 2015 Change 2019 to 2018
PLN million mln %
Net interest income 998.2 881.0 798.5 675.0 589.5 117.1 13.3%
Net commission income 318.9 305.8 281.8 243.3 243.1 13.0 4.3%
One-off income* 0.0 0.0 2.8 43.3 24.0 0.0
Other revenue** 30.4 39.4 40.5 26.7 46.2 -9.0 -22.9%
Total revenue 1 347.4 1 226.3 1 123.5 988.3 902.8 121.2 9.9%
Operating costs 580.5 545.3 503.2 479.7 515.1 35.2 6.5%
including one-off costs* 0.0 0.0 0.0 2.8 39.1 0.0
Impairment losses and provisions 140.8 117.4 99.2 68.7 55.5 23.4 19.9%
Bank levy 101.3 87.6 77.8 64.0 0.0 13.7 15.6%
Gross financial result 524.9 476.0 443.4 375.8 332.2 48.9 10.3%
Income tax 139.3 118.8 112.8 89.4 62.9 20.4 17.2%
Net result attributable to non-controlling shareholders 0.0 0.0 0.0 0.0 0.0 0.0
Net financial result 385.6 357.1 330.6 286.4 269.3 28.5 8.0%
Adjusted net result* 385.6 357.1 328.3 253.5 277.8 28.5 8.0%

* Income: dividend of PLN 82.1 million from ING PTE in Q2 2015, income of PLN 18.4 million from the disposal of ING PTE shares in Q3 2015 and positive impact of PLN 189.6 million under the Visa Europe transaction in Q2 2016 and positive impact of PLN 11.9 million under the Visa Inc. transaction in Q2 2017; Costs: PLN 157.4 million of extraordinary contribution to BGF stemming from the SK Bank bankruptcy in Q4 2015, PLN 6.4 million of contribution to the Mortgage Support Fund in Q4 2015 and PLN 12.2 million of extraordinary contribution to BGF under the bankruptcy of the Cooperative Bank in Nadarzyn.

** Including the share in net profits of affiliated entities recognised on an equity basis.

Basic consolidated income statement figures in analytical terms
2019 2018 2017 2016 2015 Change 2019 to 2018
PLN million mln %
Net interest income 1 117.1 1 037.7 905.3 744.3 650.5 79.4 7.6%
Net commission income 356.8 360.2 319.5 268.3 268.2 -3.4 -0.9%
One-off income* 0.0 0.0 3.2 47.8 26.5 0.0
Other revenue** 34.0 46.4 45.9 29.4 51.0 -12.4 -26,7%
Total revenue 1 507.9 1 444.3 1 273.8 1 089.8 996.1 63.6 4.4%
Operating costs 649.7 642.3 570.5 529.0 568.4 7.4 1.2%
including one-off costs* 0.0 0.0 0.0 3.1 43.2 0.0
Impairment losses and provisions 157.5 138.3 112.5 75.8 61.2 19.3 13.9%
Bank levy 113.3 103.2 88.2 70.6 0.0 10.2 9.9%
Gross financial result 587.4 560.6 502.7 414.4 366.6 26.8 4.8%
Income tax 155.9 140.0 127.9 98.6 69.4 15.9 11.3%
Net result attributable to non-controlling shareholders 0.0 0.0 0.0 0.0 0.0 0.0
Net financial result 431.5 420.6 374.8 315.8 297.1 10.9 2.6%
Adjusted net result* 431.5 420.6 372.2 279.6 306.5 10.9 2.6%

* Income: dividend of PLN 82.1 million from ING PTE in Q2 2015, income of PLN 18.4 million from the disposal of ING PTE shares in Q3 2015 and positive impact of PLN 189.6 million under the Visa Europe transaction in Q2 2016 and positive impact of PLN 11.9 million under the Visa Inc. transaction in Q2 2017; Costs: PLN 157.4 million of extraordinary contribution to BGF stemming from the SK Bank bankruptcy in Q4 2015, PLN 6.4 million of contribution to the Mortgage Support Fund in Q4 2015 and PLN 12.2 million of extraordinary contribution to BGF under the bankruptcy of the Cooperative Bank in Nadarzyn.

** Including the share in net profits of affiliated entities recognised on an equity basis.

Profit before tax and net profit

In 2019, the ING Bank Śląski S.A. Group posted the net profit attributable to the shareholders of the parent entity of PLN 1 658.7 million. This is the highest ever result of the Bank. It implies that the net result improved by 8.9% from 2018. As since the beginning of 2018, the Bank has applied, in its financial statements, the equity method to measure investments in its subsidiaries and affiliates, the consolidated net result of the Bank Group is the same as the separate net result of the Bank.

 Change currency: PLNEURUSD
Profit before tax and net profit of ING Bank Śląski S.A. Group (PLN million)
Profit before tax and net profit of ING Bank Śląski S.A. Group (EUR million)
Profit before tax and net profit of ING Bank Śląski S.A. Group (USD million)

The result before tax was PLN 2,257.8 million and it was up by 11.2% compared to 2018. Both in 2018 and in 2019 there were no one-off factors.

The profit before tax in 2019 was up by PLN 226.9 million compared to 2018 mainly due to:

  • net interest income, which was up by PLN 534.6 million, or 14.2%, and
  • commision income, net up by PLN 66.8 million, i.e. by 5.1%.

Whereas, the negative factors impacting the result before tax when compared with 2018 were:

  • other income down by PLN 37.4 million, i.e. by 22,2%,
  • Operating costs up by PLN 170.6 million, i.e. by 7.3%,
  • expected/impairment losses and provisions up by PLN 104.6 million, i.e. by 20.9%, and
  • bank levy up by PLN 61.9 million, i.e. by 16.6%.
 Change currency: PLNEURUSD
Change drivers for result before tax of ING Bank Śląski Group in 2019 (PLN million)
Change drivers for result before tax of ING Bank Śląski Group in 2019 (EUR million)
Change drivers for result before tax of ING Bank Śląski Group in 2019 (USD million)

In 2019 the total income of ING Bank Śląski S.A. Group attributable to the shareholders of the parent company (including, apart from net profit, also other income and cost items included in equity) amounted to PLN 2,356.9 million compared to PLN 2,203.2 million in 2018.

Revenue

In 2019, total revenue of the ING Bank Śląski S.A. Group amounted to PLN 5,796.4 million. This means that the improvement compared to 2018 was PLN 564.0 million or 10.8% and was mainly driven by higher net interest income. Its share in total income was up by 2.2 p.p. y/y up to 74.1%.

 Change currency: PLNEURUSD

*Including the share in net profits of affiliated entities recognised on an equity basis.

*Including the share in net profits of affiliated entities recognised on an equity basis.

 Change currency: PLNEURUSD

*Including the share in net profits of affiliated entities recognised on an equity basis.

*Including the share in net profits of affiliated entities recognised on an equity basis.

In 2019, the retail segment was the main income growth contributor Its income was up by PLN 251.8 million, or 11.5%, to up to the level of PLN 2,450.0 million. Consequently its share in the structure was up by 0.3 p.p. to the level of 42.3%. Income of the retail segment was up by PLN 312.2 million, or by 10.3%, to reach PLN 3,346.4m.

 Change currency: PLNEURUSD

*Including the share in net profits of affiliated entities recognised on an equity basis.

*Including the share in net profits of affiliated entities recognised on an equity basis.

 Change currency: PLNEURUSD

*Including the share in net profits of affiliated entities recognised on an equity basis.

*Including the share in net profits of affiliated entities recognised on an equity basis.

Net interest income

In 2019, interest income was up by 13.0% compared to 2018, mainly due to higher interest on loans and other receivables. On the other hand, interest expenses were up by 7.8% y/y, mainly due to higher costs of liabilities to clients. Consequently, the net interest income was up by 14.2% y/y, i.e. by PLN 534.6 million to the level of PLN 4,293.9 million. Despite record low interest rates (reference rate of 1.5%), interest income was up due to higher business volumes with a stable interest margin.

In the Q4 2019, the net interest income was adversely affected by the adjustment of interest income due to recognition of the difference between the value of loan fees settled in the results using the effective interest rate method and the value of loan fees returned to individual Clients calculated using the straight-line method in the case of prepaid loans before the contractual maturity. The adjustment totalled PLN 21.0 million (for more information see text box “Early repayment of consumer loans”).

The net interest income was also affected by the change in interest terms and conditions for savings accounts for retail clients effective from 3 July 2019 (a decline in interest rates on the basic account from 0.7% to 0.5%) and effective from 1 August 2019 for corporate clients.

 Change currency: PLNEURUSD
 Change currency: PLNEURUSD

The net interest margin amounted to 2.93% in 2019, i.e. remained at the same level as in 2018.

 Change currency: PLNEURUSD
Average basic interest rate* in 2019
Segment Total
Retail Corporate
Deposits
PLN 0.69% 0.72% 0.72%
FX 0.04% 0.06% 0.04%
Loans
PLN 4.44% 3.12% 3.90%
FX 0.58% 1.79% 1.77%
including: mortgage loans
PLN 3.59% 3.59%
FX 0.58% 0.58%

*Based on management data.

Net fee and commission income

In 2019, the net fee and commission income of the ING Bank Śląski S.A. Group augmented by PLN 66.8 million or by 5.1% compared to 2018 to the level of PLN 1 371.7 million.

The highest fee and commission income growth was noticed in:

  • Payment and credit cards: up by PLN 31.2 million or by 26.9% y/y to the level of PLN 147.2 million. It was fuelled by a growing customer base and Clients’ activity.
  • The FX transaction spreads: up by PLN 26.5 million or 7.3% y/y up to the level of PLN 389.7 million. This was fuelled by growing turnover volumes.
  • Insurance products: up by PLN 26.0 million or 23.7% y/y up to the level of PLN 135.5 million. This was fuelled by higher cross-sales with lending products, but also higher sales of stand-alone insurance products.
 Change currency: PLNEURUSD
Net fee and commission income (PLN million)
Net fee and commission income (PLN million)
Net fee and commission income (PLN million)

Other income

In 2019, other income of the Group (in including the share in the net result of associates recognised on an equity basis) was PLN 130.8 million and was down by PLN 37.4 million compared to the previous year. The decline is mainly fuelled by a lower result on the sales of bonds (as part of the investment income, it was down by PLN 18.7 million y/y) and by setting up a provision in Q3 2019 for pre-contractual repayments of retail loans (including mortgages, more information see “Early repayment of consumer loans”) in the amount of PLN 17.1 million.

 Change currency: PLNEURUSD
Other income* (PLN million)
Other income* (PLN million)
Other income* (PLN million)

*Including share in net profits of associated entities measured by equity method.
**Dividends from ING PTE in Q2 2015 totalling PLN 82.1 million; sales income from ING PTE in Q3 2015 totalling PLN 18.4 million of income from Visa Europe transaction in Q2 2016 totalling PLN 189.6 million; income from Visa Inc. transaction in Q2 2017 totalling PLN 11.9 million.

General and administrative expenses

In 2019, the operating expenses of the ING Bank Śląski S.A. Group went up by 7.3% y/y to the level of PLN 2,497.4 million, including own costs that were up by 6.0% y/y to PLN 2,279.0 million, and regulatory costs (total BGF and PFSA expenses) up by 23.9% y/y to the level of PLN 218.4 million. The increase in the value of own costs was visible in all major categories, which was due to business development. In 2019 the highest growth was recorded in the following categories:

  • personnel costs (by PLN 97.8 million, or by +8.9% y/y) as a result of wage increases (the wage increase was in April, just like in 2018), and
  • amortisation and depreciation costs (up by PLN 83.3 million, or +43.0% y/y), however, 2019 and 2018 costs are not comparable due to IFRS 16 in force from the beginning of 2019. Had it not been for the new standard, the amortisation and depreciation value for 2019 would have been lower by PLN 96.8 million, and the operating costs would have been higher by the same amount. Adjusted amortisation and depreciation in 2019 would have amounted to PLN 180.0m (-7.0% y/y), and adjusted other operating costs to PLN 793.2m (+6.4% y/y).
 Change currency: PLNEURUSD
General and administrative expenses (PLN million)
General and administrative expenses (PLN million)