Polish Financial Supervision Authority with new entitlements

The Polish Financial Supervision Authority received new powers - this is the result of Friday's vote by the Sejm of the Republic of Poland on the amendment to the act on financial supervision. The scope of changes that will be implemented is exceptionally wide. Thanks to the new regulations, the scope of PFSA activities will include extended to a new sector of the financial market - asset securitization.

Insight into confidential information

As a result of the amendment to the Act, the Polish regulator will gain access to confidential information. He will also be able to demand from the entities they supervise, impose fines on them, and report potential violations to the prosecutor's office. He will also get permission to publish it on the list of public warnings (available on the KNF website) information on the imposition of penalties or conduct proceedings.

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But this is not the end. The amendment introduces a new legal framework for the securitization of assets and defines this concept. The Act also includes a provision specifying requirements for entities that plan to carry out the securitization process and sets limits on investments in these assets from retail investors.

What is securitization

Securitization enjoys exceptional popularity in the American market. In Poland, the securitization process is legally possible from 2004, thanks to the Act on Investment Funds and Alternative Investment Fund Management (Journal of Laws 2004 No. 146, item 1546), however, it is very rarely used.

The securitization process itself mainly concerns banking institutions and the financial sector in general. It is a refinancing strategy by isolating a particular tranche of assets and transforming them into debt securities, such as bonds or investment certificates.