banking & finance | In Principle

Sustainable finance is an approach that links financial issues with care for the environment, society, and corporate ethics. In Poland, the development of sustainable finance will continue to be handled by the Sustainable Finance Platform.

On 26 June 2023, the Polish Financial Supervision Authority (KNF) adopted the new Recommendation U on good bancassurance practices, which will replace the previous Recommendation U of June 2014.

When a creditor enforces its registered pledge by taking title to pledged shares, it’s just the start. To effectively take control of the company and satisfy its claim by selling the shares or assets, the creditor must take a series of legal and factual steps. It’s not always easy.

In our previous article we discussed the recent amendments to the Green Loan Principles and Social Loan Principles, and accompanying guidance. Today, we will focus on the Sustainability-Linked Loan Principles. Here, the amendments are more extensive.

For a loan to be classified as “green,” “social,” or “sustainability-linked,” it must meet certain criteria described in the principles jointly developed by the LMA (Loan Market Association), APLMA (Asia Pacific Loan Market Association) and LSTA (Loan Syndications and Trading Association). The principles are not binding law, but voluntary recommendations allowing all market participants to clearly understand the essential features of such loans. The principles were amended in February 2023.

A request for a payment guarantee may appear on an investor’s desk suddenly, causing numerous complications. Sometimes, contractors make such a demand to have an excuse to withdraw from the contract. Then a race against the clock begins, not to give them that excuse. But in advance, the investor can also arrange a commercial solution to the problem, i.e. a bank guarantee facility in the loan agreement.

Effective as of 1 July 2022, the new Developers Act expands the scope of bank oversight of development ventures before paying out to the developer the funds due for a given phase of the project. But the regulations are imprecise, and it is unclear whether the bank must redo the audit when the buyer has made a late payment of funds into an open housing escrow account.

Sometimes, in financing transactions, for various reasons related to the structure of the particular transaction and the commercial arrangements of the parties, atypical assets are offered as collateral for receivables of the financing party. In such situations, the parties need to think about how to select legal instruments to implement commercial collateral arrangements. Investment participation units in a fund are an interesting asset due to the specific statutory regulations.

Receivables as an asset are present everywhere in the business world. This is an asset which could be a problem for some, but at the same time an investment opportunity for others. The aim of this article is to consider how healthy and performing receivables could be used to obtain financing from investors and to discuss how non-performing claims serve as an investment in Poland.

The new Developers Act substantially modifies the rights and obligations of banks in connection with real estate developments. The new regulations significantly increase the scope of rights and obligations of banks, which will entail a greater expenditure of time and effort on their side. Thus the new rules may increase the cost of banks’ participation in the execution of residential developments.

The pandemic has made it hard to organise traditional deal closings. Earlier, in typical financing transactions, it was no problem to arrange a physical meeting of the parties to sign the complete set of financing documentation, including security instruments (e.g. a pledge agreement or agreement to establish a mortgage). Indeed, some clients insisted on holding a traditional closing. The pandemic has changed this perspective, focusing the parties’ attention on the possibilities for remote signing of agreements.

With increasing mobility on the labour market, more and more foreigners from non-EU countries are settling in Poland for economic reasons. As most often salaries are paid by bank transfer, one of the first issues when relocating is to open a bank account in Poland. To keep up with market changes, Polish banks try to make their offers more flexible and adapt them to customers’ current needs. Thus banks offer many services aimed at foreigners, including those from non-EU countries, and banking products are becoming more and more available to them.