5.2. Changes in the consolidated statement of financial position

Changes in assets of mBank Group

The assets of mBank Group increased by PLN 13,703.0 million, i.e., 13.1% in 2014. Total assets stood at PLN 117,985.8 million as at December 31, 2014.

The table below presents the year-on-year change in the asset lines of mBank Group.

Assets of mBank Group

 

 
PLN M 2013 2014 Change in PLN m Change in %
Cash and balances with Central Bank 1,650.5 3,054.5 1,404.0 85.1%
Loans and advances to banks 3,471.2 3,751.4 280.2 8.1%
Trading securities 763.1 1,163.9 400.8 52.5%
Derivative financial instruments 2,349.6 4,865.5 2,515.9 107.1%
Net loans and advances to customers 68,210.4 74,582.4 6,372.0 9.3%
Investment securities 25,341.8 27,678.6 2,336.8 9.2%
Intangible assets 455.3 465.6 10.3 2.3%
Tangible fixed assets 709.6 717.4 7.8 1.1%
Other assets  1,331.3 1,706.5 375.2 28.2%
Total assets 104,282.8 117,985.8 13,703.0 13.1%
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Loans and advances to customers retained the largest share in the balance sheet of the Group at the end of 2014. They represented 63.2% of total assets at December 31, 2014, compared to 65.4% at the end of 2013.

The net volume of loans and advances to customers increased by PLN 6,372.0 million, i.e., 9.3% year on year.

Gross loans and advances to retail customers increased by PLN 3,252.6 million, i.e. 8.5%. The volume of mortgage and housing loans increased by PLN 1,821.2 million, i.e. 6.3% year on year mainly due to active sales of new loans. In 2014, mBank Group sold PLN 3,302.6 million of mortgage loans, which implies an increase in the volume of sales by 58.4% compared to 2013. mBank Group continued its strategic support of mBank Hipoteczny and the development of Poland’s covered bond market in 2014 as it increased sales of mortgage loans directly by mBank Hipoteczny. In 2014, mBank Hipoteczny sold PLN 526.3 million of mortgage loans. In addition, the Group granted PLN 4,353.9 million of non-mortgage loans, representing a 16.7% increase of sales. Net of the FX effect, loans and advances to retail customers grew by ca. 5.7%.

 

Loans and advances to customers

 

 
PLN M 2013 2014 Change in PLN m Change in %
Loans and advances to individuals 38,307.9 41,560.5 3,252.6 8.5%
Loans and advances to corporate entities 29,475.3 32,841.0 3,365.7 11.4%
Loans and advances to public sector 2,178.0 1,924.4 -253.6 -11.6%
Other receivables 620.6 1,047.3 426.7 68.8%
Total (gross) loans and advances to customers 70,581.8 77,373.2 6,791.4 9.6%
Provisions for loans and advances to customers (negative amount) -2,371.4 -2,790.8 -419.4 17.7%
Total (net) loans and advances to customers 68,210.4 74,582.4 6,372.0 9.3%
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At the same time, gross loans and advances to corporate customers increased by PLN 3,365.7 million, i.e. 11.4%. Net of reverse repo/buy sell back transactions and the FX effect, loans and advances to corporate customers increased by ca. 9.1% year on year. The volume of gross loans and advances to the public sector decreased by PLN 253.6 million, i.e., 11.6%.

Investment securities constituted mBank Group’s second largest asset category (23.5%). In 2014, their value increased by PLN 2,336.8 million, i.e. 9.2%. The government bond portfolio increased by 21.5% year on year while the portfolio of debt instruments issued by the central bank decreased by 29.1%.

The other asset lines on mBank Group’s balance sheet represented 13.3% of total assets in aggregate.

Changes in equity and liabilities of mBank Group

The table below presents changes in the equity and liabilities of the Group in 2014.

 

 
PLN M 2013 2014 Change in PLN m Change in %
Amounts due to other banks 19 224.2 13 383.8 -5 840.4 -30.4%
Derivative financial instruments and other trading liabilities 2,459.7 4,719.1 2,259.4 91.9%
Amounts due to customers 61,673.5 72,422.5 10,749.0 17.4%
Debt securities in issue 5,402.1 10,341.7 4,939.6 91.4%
Subordinated liabilities 3,762.8 4,127.7 364.9 9.7%
Other liabilities  1,504.1 1,918.0 413.9 27.5%
Total Liabilities 94,026.4 106,912.8 12,886.4 13.7%
Total Equity 10,256.4 11,073.0 816.6 8.0%
Total Liabilities and Equity 104,282.8 117,985.8 13,703.0 13.1%
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Amounts due to customers remained the dominant funding source of mBank Group. They accounted for 61.4% of equity and liabilities at the end of 2014, compared to 59.1% at the end of 2013.

Amounts due to customers increased by PLN 10,749.0 million, i.e., 17.4% to PLN 72,422.5 million in 2014. The change was driven by an increase of amounts due to both retail and corporate customers.

Amounts due to corporate customers increased by PLN 5,484.2 million, i.e., 20.5%. Net of repo transactions, amounts due to corporate customers increased by ca. 28.8%.

Amounts due to customers

 

 
PLN M 2013 2014 Change in PLN m Change in %
Individual customers 34,203.1 39,284.8 5,081.7 14.9%
Corporate customers 26,752.9 32,237.1 5,484.2 20.5%
Public sector customers 717.5 900.6 183.1 25.5%
Total amounts due to customers 61,673.5 72,422.5 10,749.0 17.4%
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Amounts due to retail customers increased by PLN 5,081.7 million, i.e., 14.9%. Current accounts increased by 15.3%. Term deposits of retail customers increased by 13.3% year on year.

Amounts due to other banks decreased by PLN 5,840.4 million, i.e., 30.4% year on year to PLN 13,383.8 million at the end of 2014. The change was mainly driven by the repayment of CHF 850 million and USD 100 million of loans granted by Commerzbank Group, as well as a lower volume of repo transactions.

The share of debt securities in issue in mBank Group’s total equity and liabilities increased from 5.2% at the end of 2013 to 8.8% at the end of 2014. The main driver of the change was a EUR 1 billion euro note issue.

In 2014, the Bank issued PLN 750 million of 10-year subordinated bonds on the Polish market.

The share of equity in equity and liabilities of mBank Group was 9.4% at the end of 2014, compared to 9.8% at the end of 2013 due to the retention of part of earnings.