Business operations of Capital Group companies
1. Structure of ING Bank Śląski S.A. Capital Group
The ING Bank Śląski S.A. Capital Group comprises companies operating predominantly on the financial market. ING Bank Śląski S.A. – as the parent company – takes key decisions concerning both the scope of operations and the finances of the Group members. It has strong commercial ties with other companies. The Capital Group members have their current accounts and deposit their free funds in term deposits at ING Bank Śląski S.A. The Bank also credits business operations of some of its subsidiaries. Transactions of ING Bank Śląski S.A. with its subsidiaries are performed on an arm’s length basis.
In 2014, there was a change in the Group structure. On 30 June 2014, Centrum Banku Śląskiego Sp. z o.o. was deleted from the Entrepreneurs Register of the National Court Register. The company was taken over by ING Bank Śląski S.A. and Solver Sp. z o.o.
As at 31 December 2014, the composition of the ING Bank Śląski S.A. Capital Group was the following:
* In Q2 2014, the Group reclassified shares in the associated entity to the category of assets held for sale.
** UdB S.A. holds 100% of shares of Nowe Usługi S.A. company incorporated in H1 2014 (the company is not fully operative yet).
*** The ING Lease (Polska) Sp. z o.o. Capital Group has 10 special-purpose vehicles where ING Lease holds 100% of shares.
2. ING Securities S.A.
ING Securities S.A. (Brokerage Office) provides brokerage services both for retail and corporate clients. At the end of June 2014, ING Securities S.A. maintained almost 51.1 thousand investment accounts, including almost 37 thousand internet ones.
In February 2014, ING Securities expanded its offer with the Forex service and thus provided clients with the option of investing on the OTC currency market. Through a modern ING ProTrader transactional and analytical platform, available also on mobile devices, retail investors have access to the most liquid financial market in the world whose global daily trading is a hundred times bigger than trading in equities from all stock exchanges.
ING Securities S.A. conducts also a number of educational activities for its clients such as Real time analyses, among others. Those are online meetings that clients hold with the Office analyst during which an ongoing analysis of the FX market is performed. Clients can ask questions and actively participate in the discussion.
Furthermore, in cooperation with ING Bank N.V. a virtual investment game was launched in April 2014. It is aimed at educating and promoting quoted ING Turbo Certificates.
On 27 October 2014, the brokerage service application was integrated with the ING BankOnLine internet banking system. Thus, the Bank and Brokerage Office clients have access to the comprehensive range of services with the use of one platform. Moreover, clients who have concluded a framework agreement with the Bank can quickly and easily open a brokerage account electronically.
In 2014, ING Securities S.A. participated in the key transactions in the market:
- Enea S.A. – sale of bundle of shares, transaction amount PLN 1 billion, Brokerage Office role: Joint Bookrunner,
- LOTOS S.A. – issue of shares with pre-emptive rights, transaction amount PLN 966 million, Brokerage Office role: Co-Lead Manager.
3. ING Lease (Polska) Sp. z o.o.
ING Lease (Polska) Sp. z o.o. has been operating on the market since 1996. It offers all basic types of leasing (operating, financial, and sale-and-leaseback leasing) as well as a cash loan. They can be used to finance both movables (being passenger cars, delivery trucks up to 3.5 tonnes, machinery and equipment, technological lines, commercial vehicles medical and IT equipment) as well as real properties (office buildings, commercial buildings and logistics centres). Company’s services are targeted at all market segments: large, medium and small enterprises as well as retail clients (entrepreneurs).
As at 31 December 2014, receivables of ING Lease amounted to PLN 5,387.4 million34 (an increase of 9.2% from the 2013 yearend). The data of the Polish Leasing Association show that ING Lease, with its 5.9% market share in terms of worth of lease agreements concluded and assets provided, was the eighth largest leasing company in Poland. At the same time, the Company was third considering its lease portfolio volume after 2014 (enjoying the market share of 6.9%).
At the beginning of 2014, ING Lease introduced changes to its offer of financing passenger cars and delivery trucks up to 3.5 tonnes, including, among others, offer availability for clients conducting business activity for less than 12 months. In May 2014, ING Auto Leasing was awarded by Gazeta Finansowa as the best product for SMEs in the Leasing category for the second consecutive year. Furthermore, in 2014 the company opened external sales network responsible for sale of ING Agro Leasing for agricultural entrepreneurs and individual farmers.
34 The description is made based on the data from the management information system. It covers corporate clients (in the amount of PLN 4,788.2 million) and retail clients receivables (in the amount of PLN 144.4 million)..
4. ING Commercial Finance Polska S.A.
ING Commercial Finance Polska S.A. provides factoring services and was included into the ING Bank Śląski S.A. Capital Group structure at the beginning of 2012. Since then, it has been gradually expanding the scale of its business and the number of serviced clients.
In 2014, ING Commercial Finance Polska S.A. grew almost twice as fast as the market and recorded the turnover of PLN 16.9 billion. It is an increase of 31% versus 2013. On account of sustained stable growth over 2014, the Company, already after Q3 2014, became the leader of the factoring market in Poland. What is more, the record Q4 (turnover of PLN 4.8 billion) enabled ING CF to strengthen its position as at the 2014 yearend with 14.8% share in market turnover.
In 2014, ING Commercial Finance acquired 337 new clients and at the yearend the number of serviced clients amounted to 1,069 i.e. increased by 184 clients (+21%) versus the 2013 yearend. The Company’s turnover is dominated by clients from the following sectors: food and beverages (23%), power and fuels (10%), house and horticulture (9%), construction (8%), metallurgy (7.2%), and packaging (6.2%).
ING Commercial Finance also leads in terms of the number of financed invoices. As as the 2014 yearend, their number totalled 1,157 thousand, i.e. up by 241 thousand (+26%) on a year earlier.
In 2014, ING Commercial Finance Polska S.A. continued to pursue the strategy of full cooperation with ING Bank Śląski S.A. as regards sale processes. All Bank clients have easy access to factoring products offered by ING Commercial Finance via the ING BusinessOnLine banking system. Factoring products are also sold via fast track.
5. ING Usługi dla Biznesu S.A.
2014 was the first year, during which ING Usługi dla Biznesu S.A. conducted full operations in two business areas, that is:
- accountancy and payroll services rendered via ING Accounting,
- Aleo internet trading and auction platform for enterprises.
The Company’s main priority was to pursue the strategy on implementing and developing Aleo.com targeted at building the popularity and brand of the portal. Therefore, in H1 2014, a marketing campaign The Boss of all the bosses was launched in cooperation with ING Bank Śląski S.A. As a result, more than 39 thousand users have registered on Aleo and the portal was among the most recognisable internet websites for companies. The fact that Aleo was well perceived by the market enabled the Company to take on an additional, international development direction. The service has been translated into English and prepared to be launched in other countries in the future. At the same time, Aleo portal is being constantly developed in order to provide its clients on the Polish market with the best business value.
Furthermore, in 2014 ING Accounting was offered all over Poland. Accountancy and payroll services are invariably targeted at the companies obliged to keep full accounting, the segment in which ING Accounting specialises. The service model uses the synergy between the accounting and banking services with the use of the modern internet tools that facilitate client cooperation with the accounting office. At present, ING Accounting provides its services to more than 150 clients.
6. ING Powszechne Towarzystwo Emerytalne S.A.
From the very beginning, ING Otwarty Fundusz Emerytalny, the open-end pension fund managed by ING Powszechne Towarzystwo Emerytalne S.A., has been among the leaders on the pension funds market in Poland. As at 31 December 2014, ING OFE (ING Open-End Pension Fund) maintained its position of the leader on the market whereon 12 pension funds currently operate, both in terms of the value of assets under management as well as the number of members:
- Number of members. The Fund had 3,081.5 thousand members, or 18.5% of all participants in the open-end pension funds.
- Net assets. They totalled PLN 35.9 billion or 24.1% of the total worth of assets of open-end pension funds operating in Poland (the share remained unchanged versus 2013 yearend).
It should be noted that at the beginning of 2014, new provisions on the operations of pension funds came into effect. On 03 February 2014, open-end pension funds redeemed 51.5% of settlement units from an account of each fund participant and transferred the assets corresponding to the value of the redeemed units to the Social Insurance Institution. It mainly concerned assets in the form of bonds and bills issued by the State Treasury or Bank Gospodarstwa Krajowego. As a result, the value of assets managed by OFE contracted by more than half.
As at 31 December 2014, the value of an ING OFE settlement unit amounted to PLN 39.30 (down by 0.8% as compared with the 2013 yearend). The value of ING DFE settlement unit also decreased slightly and as at the end of 2014 amounted to PLN 16.35 versus PLN 16.47 a year earlier (-0.7%).
On 06 May 2014, ING Bank Śląski S.A. concluded with ING Continental Europe Holdings B.V. (NN CEH) a Letter of Intent regarding the sale of 20% of the shares in ING Powszechne Towarzystwo Emerytalne S.A. held by the Bank to NN CEH (current report no. 15/2014 of 07 May 2014). On 10 February 2015, the parties concluded the Share Purchase Agreement (current report no. 03/2015 of 11 February 2015).
7. Solver Sp. z o.o.
Solver Sp. z o.o. runs business activity on behalf of ING for Children Foundation. The Company not only organises education and recreation as well as rehabilitation stays for children aided by the Foundation, but it also arranges recreation for Bank employees and their families as well as training programmes therefor. Moreover, space and parking lots lease as well as hotel rooms administration constitute Company’s additional business activity.