Opinion of the European Central Bank of 16 July 2009 on the legal framework for cooperative savings and credit unions (CON/2009/60)
Date: 2009-07-16
Institutions: European Central Bank
Subjects: Poland, cooperative bank, financial stability, financial supervision, foreign-exchange reserves, national law

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 16 July 2009 

on the legal framework for cooperative savings and credit unions 

(CON/2009/60) 

Introduction and legal basis 

On  4  May  2009  the  European  Central  Bank  (ECB)  received  a  request  from  the  Marshall  of  the  Polish 

Parliament for an opinion on a draft law on cooperative savings and credit unions and on amendments to 
certain other laws (hereinafter the ‘draft law’)1.  

The  ECB’s  competence  to  deliver  an  opinion  is  based  on  Article  105(4)  of  the  Treaty  establishing  the 

European Community and the third and sixth indents of Article 2(1) of Council Decision 98/415/EC of 

29 June 1998  on  the  consultation  of  the  European  Central  Bank  by  national  authorities  regarding  draft 
legislative provisions2, as the draft law relates to Narodowy Bank Polski (NBP) and to rules applicable to 

financial institutions insofar as they materially influence the stability of financial institutions and markets. 

In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central 

Bank, the Governing Council has adopted this opinion. 

1.  

Purpose of the draft law 

1.1  The  draft  law  will  regulate  credit  unions  active  in  Poland,  i.e.  SKOK  credit  unions  (spółdzielcze 

kasy oszczędnościowo-kredytowe). For this purpose, the draft law will replace the current Law on 
SKOK credit unions of 14 December 1995 (hereinafter the ‘current Law on credit unions’)3. SKOK 

credit  unions  form  a  distinct  segment  of  the  Polish  financial  sector.  They  are  entitled  to  offer 
similar  consumer  banking  services  to  those  offered  by  ordinary  credit  institutions  (banks4),  with 
exception of certain types of mortgage credit5. However, under the current Law on credit unions, 

SKOK  credit  unions  are  not  regulated  and  supervised  by  the  Financial  Supervision  Commission 

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Parliamentary Print No 1876 of 19 March 2009. 
OJ L 189, 3.7.1998, p. 42. 
Dziennik Ustaw (Dz. U.) of 4 January 1996 No 1, Item 2. 
Credit  institutions  registered  in  Poland  are  legally  referred  to  as  ‘banks’  (this  legal  term  does  not  cover  SKOK  credit 
unions). The term ‘credit institutions’ under Polish law only relates to European Economic Area (EEA) credit institutions 
from  outside  Poland.  Non-EEA  credit  institutions  are  referred  to  under  Polish  law  as  ‘foreign  banks’  (Article  2, 
Article 4(3) and Article 4(1)(17) to (20) of the Law on banking of 29 August 1997 (consolidated text: Dz. U. of 12 June 
2002 No 72, Item 665, hereinafter, the ‘Law on banking’)). 
See Article 21 of the current Law on credit unions; cf. judgment of the Polish Constitutional Tribunal of 24 March 2009 
(Case No K53/07). 

 
 
 
 
 
                                                 
(FSC), the Polish financial supervisory authority, but instead by a statutory central association of 
individual SKOK credit unions, the National SKOK6. The draft law will substantially modify these 

arrangements by giving the FSC powers to regulate and supervise the SKOK system. The FSC will 

exercise  its  new  powers  in  relation  to  the  SKOK  system,  inter  alia  by:  (i) issuing  prudential 

regulations  for  the  SKOK  system;  (ii)  licensing  new  individual  SKOK  credit  unions  and 
conducting on-site inspections of them7; and (iii) supervising the National SKOK, in particular as 

regards  the  operation  of  ‘stabilisation  fund’  which  insures  the  deposits  held  with  the  SKOK 
system8. The National SKOK will retain certain regulatory powers in relation to individual SKOK 

credit unions, in particular as regards making prudential recommendations and exercising control 
competences  in  this  respect9.  Nevertheless,  the  FSC  will  be  exclusively  competent  to  enforce 

binding  corrective  measures  and  to  institute  rehabilitation  or liquidation  procedures  in  relation  to 
individual SKOK credit unions on its own initiative or at the request of the National SKOK10. The 

FSC will also have powers to suspend the governing bodies of the National SKOK if they fail to 
comply with the FSC’s recommendations11. Further substantial changes introduced by the draft law 

relate  to  the  conversion  of  credit  unions  into  regular  banks,  which  will  be  obligatory  for  credit 

unions  exceeding  a  specified  amount  of  own  funds,  introduction  of  rules  regarding  the  voting 

power of individual SKOK credit unions in the National SKOK, limitations on the activities of the 
National SKOK, etc.12 

1.2  The  draft  law  also  amends  certain  other  laws,  including  the  Law  on  Narodowy  Bank  Polski  of 
29 August  199713  (hereinafter,  the  ‘Law  on  NBP’).  In  particular,  the  proposed  amendment  to 

Article 42  of  the  Law  on  NBP  provides  that  SKOK  credit  unions  will  be  eligible  to  obtain 

refinancing credit from NBP under the same conditions as regular credit institutions established in 
Poland14.  

2. 

ECB comments 

2.1  Obligation to maintain minimum reserves with the central bank 

The draft law maintains the current arrangements under which SKOK credit unions are not subject 

to the obligation to hold minimum reserves with NBP. The ECB makes the following observations 

in this respect. 

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See Articles 34, 35(5)-(6) and (9), 36 and 39-43 of the current Law on credit unions.  
See Articles 58 and 59(1) and Articles 6-8, 19, 37, 60, 65, 67, and 78(1) of the draft law.  
See Articles 58 and 59(2) and Articles 47, 49(3)-(4), 53, 66-67, 76(1)-(2) and 78(2) of the draft law.  
See Articles 40-42, 61-64, 67-68 of the draft law.  
See Articles 68(2) and 69-75 of the draft law.  
See Articles 76(3) and 77 of the draft law.  
See Articles 9-10, 41, 46(2) and 54 of the draft law.  
Consolidated text: Dz. U. of 1 April 2005 No 1, item 2.  
See amendments introduced by Article 85(4) of the draft law.  

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2.2 

In  past  opinions  adopted  at  the  request  of  other  Member  States15,  the  ECB  has  consistently 

maintained that the Eurosystem’s minimum reserves obligations apply, inter alia, to credit unions 

that  fulfil  the  functional  criteria  of  a  ‘credit  institution’  as  defined  in  the  Recast  Banking 
Directive16.  This  definition,  which  is  recalled  in  the  Eurosystem’s  minimum  reserves  rules17, 

specifies  that  credit  institutions  are  undertakings  whose  business  is  to  receive  deposits  or  other 

repayable funds from the public and to grant credit for their own account. The ECB is aware that 

specified types of credit unions are exempt, for prudential supervision purposes, from the scope of 
application of the Recast Banking Directive18 and that the national law provisions of the Member 

States may establish special regulatory regimes in relation to such credit unions, separate from the 
general regulation of banking activities19. However, such exclusions or variations introduced in the 

area of prudential supervision do not automatically exclude any entities which fulfil the functional 

criteria of a ‘credit institution’ from the Eurosystem’s reserve requirements, which, in line with the 

Article 19.1 of the Statute of the European System of Central Banks and of the European Central 

Bank, constitute a monetary policy instrument and hence have a different function than prudential 
supervision20.  Consequently,  exemptions  provided  for  as  part  of  the  Eurosystem’s  minimum 
reserves  regime21  do  not  follow  the  same  pattern  as  exemptions  from  the  prudential  rules 

introduced  by  the  Recast  Banking  Directive  (one  element  of  such  exemptions  from  the 

Eurosystem’s  minimum  reserves  regime  is  a  lump-sum  allowance  benefiting,  in  particular,  small 
credit institutions, irrespective of their legal form22). 

2.3 

In  this  context,  the  ECB  notes  that  SKOK  credit  unions  fulfil  the  abovementioned  functional 

criteria of a ‘credit institution’ (and will continue to fulfil them under the draft law), namely that 

they: (i) receive deposits ‘from the public’ within the meaning of the Recast Banking Directive, i.e. 
receive  deposits  from  natural  or  legal  persons23;  and  (ii)  grant  credit  for  their  own  account24. 
Consequently, in line with its pervious opinions25, the ECB considers that SKOK credit unions will 

be subject to the Eurosystem’s minimum reserves requirements when Poland adopts the euro. Such 

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25 

See paragraphs 10-14 of ECB Opinion CON/2005/8 (Lithuania), paragraph 3.1 of ECB Opinion CON/2006/4 (Cyprus) 
and paragraphs 10-17 of ECB  Opinion CON/2006/11 (Latvia) (All ECB opinions are available on the ECB website at 
www.ecb.europa.eu/ecb/legal/opinions/html/index.en.html.) 
See Article 4(1)(a) of Directive 2006/48/EC of the European Parliament and of the Council of 14 June 2006 relating to 
the taking up and pursuit of the business of credit institutions (recast) (OJ L 177, 30.6.2006, p. 1).  
See Article 2(1) of Regulation ECB/2003/9 of 12 September 2003 on the application of minimum reserves (OJ L 250, 
2.10.2003, p. 10). 
See Article 2 of the Recast Banking Directive.  
The  current  Law  on  SKOK  credit  unions  is  an  example  of  such  a  special  regulatory  regime  (which  will  generally  be 
maintained by the draft law).  
Such as contributing to the stabilisation of the money market interest rates and the enlargement of the banking system’s 
structural liquidity shortage (cf. paragraph 14 of the ECB Opinion CON/2006/11). 
See Article 2.2 of Regulation ECB/2003/9.  
See Article 5.2 of Regulation ECB/2003/9. 
As opposed to inter-bank deposits. A statutory condition requiring members of individual SKOK credit unions to have a 
‘professional or organisational’ relation with each other (Article 6 of the current Law on credit unions; Article 11 of the 
draft law) does not constitute an impediment in this respect; cf. paragraph 16 of ECB Opinion CON/2006/11.  
See Article 3.1 of the current Law on credit unions and Article 3 of the draft law.  
See paragraph 14 of ECB Opinion CON/2005/8 and paragraphs 10 and 17 of ECB Opinion CON/2006/11. 

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requirements,  and  the  sanctions  related  to  them26,  will  apply  directly  by  the  operation  of 

Community law. 

2.4 

Irrespective of the above, the earlier imposition of the minimum reserves requirements on SKOK 

credit unions under national law may enable the harmonisation of Polish law with the Eurosystem’s 

requirements in this respect, which would facilitate the introduction of euro in Poland. The earlier 

inclusion  of  SKOK  credit  unions  in  NBP’s  minimum  reserves  regime  would  seem  advisable  in 

particular in connection with the draft law’s proposal to treat SKOK credit unions as eligible for 

accessing  central  bank  liquidity  (as  discussed  in  paragraph  2.6).  Extension  to  the  SKOK  credit 

unions of one of the central bank’s monetary policy instruments, i.e. the liquidity support provided 

by way of refinancing credit, should be accompanied by the application of the minimum reserves 

obligations, as a complementary monetary policy instrument that is structurally linked to liquidity 
providing operations27.  

2.5 

In view of the above considerations, the ECB would welcome the harmonisation of the Polish legal 

system  with  the  Eurosystem’s  minimum  reserves  requirements  by  the  inclusion  of  SKOK  credit 
unions in the NBP’s minimum reserves regime28. At the same time, the ECB considers that both the 

holding  of  minimum  reserves  and  access  to  the  refinancing  credit  may  be  organised  for  SKOK 
credit unions on the basis of a collective transfer mechanism administered by the National SKOK29. 

2.6  Central bank refinancing credit and compliance with the monetary financing prohibition 

Amendments  to  Article  42  of  the  Law  on  NBP  introduced  by  the  draft  law  provide  that  SKOK 

credit  unions  will  be  eligible  to  receive  refinancing  credit  from  NBP  in  the  same  manner  as 

ordinary credit institutions (banks). The ECB would like to make the following general comment 

on  the  current  wording  of  this  article  of  the  Law  on  NBP,  as  it  may  apply  to  both  SKOK  credit 

unions  and  regular  credit  institutions.  In  the  past  ECB’s  Convergence  Reports  the  ECB  has 

expressed concerns that certain elements of the Article 42 of the Law on NBP, taken together with 

the relevant provisions of the Law on banking, might suggest that NBP refinancing credit may be 
available to insolvent credit institutions30. The ECB considers such cases of central bank solvency 

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30 

See  Article  7  of  Council  Regulation  (EC)  No  2531/98  of  23  November  1998  concerning  the  application  of  minimum 
reserves by the European Central Bank (OJ L 318, 27.11.1998, p. 1) and Regulation ECB/1999/4 of 23 September 1999 
on the powers of the European Central Bank to impose sanctions (OJ L 264, 12.10.1999, p. 21). 
Systemic liquidity shortage enlarged by minimum reserves obligations contributes to increasing the demand for central 
bank  refinancing  which,  in  turn,  makes  it  easier  for  the  central  bank  to  steer  money  market  rates  through  liquidity-
providing  operations  (cf.  ‘The  monetary  policy  of  the  ECB’,  2nd  edn.  2004,  p.  79,  published  on  the  ECB’s  website  at 
www.ecb.int.) 
See paragraph 3.1 of ECB Opinion CON/2006/4, as well as, in relation to different matter, paragraph 2 of ECB Opinion 
CON/2007/28 (Poland) and paragraph 2.3 of ECB Opinion CON/2008/53 (Poland).  
See Article 38.3 of the Law on NBP allowing collective holding of minimum reserves by cooperative banks. 
See the ECB’s Convergence Report of May 2008, p. 244, and the ECB’s Convergence Report of December 2006, p. 228, 
which  in  particular  refers  to:  (i)  Article  70(2)  of  the  Law  on  banking  together  with  Article  42(7)  of  the  Law  on  NBP 
(conditions  under  which  NBP  may  extend refinancing credit  to  an  uncreditworthy  borrower); (ii)  Article  142(1) of  the 
Law  on  banking  together  with  Article  42(3)  of  the  Law  on  NBP  (conditions  under  which  NBP  may  grant  refinancing 
credit for the purpose of implementing a programme of bank rehabilitation); and (iii) Article 42(6) of the Law on NBP 
(conditions for possible termination of NBP’s refinancing facility in the event of the worsening of the financial situation 
of the recipient). 

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support to be incompatible with the safeguards laid down in the Treaty regarding a central bank’s 

capacity to perform its tasks, as expressed in Article 101(1) of the Treaty and in the implementing 
secondary legislation31. As already noted in the ECB’s Convergence Reports, clearer safeguards are 

needed  in  Article  42  of  the  Law  on  NBP  to  exclude  expressly  any  solvency  support  to  financial 

institutions  and  to  avoid  any  incompatibility  of  this  Article  with  the  monetary  financing 

prohibition. The ECB reiterates this recommendation in the present opinion. 

2.7 

Supervisory framework and central bank powers to collect information 

The  ECB  welcomes  the  new  supervisory  framework  introduced  in  relation  to  the  SKOK  system, 

which  attributes  supervisory  and  regulatory  responsibilities  for  SKOK  credit  unions  to  the  FSC. 

This should help to maintain fair competition between different participants in the Polish financial 

market  as  well  as  to  complement  the  safety  net  of  the  SKOK  system,  including  elements  to  be 

provided  for  through  implementing  acts  issued  under  the  draft  law  (e.g.  in  the  area  of  deposit 
insurance).  As  regards  the  competences  to  be  exercised  by  the  National  SKOK32,  the  ECB 

recommends that any overlap with the competences allocated to the FSC should be avoided.  

2.8   Moreover,  with  respect  to  the  tasks  to  be  assigned  to  NBP  as  regards  regulation  of  the  liquidity 

situation  and  refinancing  of  the  SKOK  credit  unions,  creating  conditions  for  their  development,  

assessing  their  operation  and  opining  on  legislation  related  to  them  (in  parallel  to  similar  tasks 
assigned  to  NBP  in  relation  to  regular  credit  institutions)33,  the  ECB  considers  that  any  such 

assignment  of  new  NBP  tasks  should  be  based  on  the  assessment  that  NBP  has  resources 
commensurate  with  such  new  tasks.  In  particular,  in  line  with  its  earlier  opinion34,  the  ECB 

recommends that, in view of the new liquidity regulation task which NBP is to exercise vis-à-vis 

SKOK  credit  unions,  NBP  should  be  given  commensurate  powers  to  obtain  all  relevant 

information, if need be by way of direct SKOK reporting to NBP. 

This opinion will be published on the ECB’s website. 

Done at Frankfurt am Main, 16 July 2009. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

31 

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34 

See in particular Article 1(1)(b)(ii) of Council Regulation (EC) No 3603/93 of 13 December 1993 specifying definitions 
for the application of the prohibitions referred to in Articles 104 and 104b(1) of the Treaty (OJ L 332, 31.12.1993, p. 1), 
which  prohibits  central  bank  financing  of  public  sector  obligations  vis-à-vis  third  parties;  see  the  ECB’s  Convergence 
Report of May 2008, p. 24, and the ECB’s Convergence Report of December 2006, p. 30. 
See, e.g., Articles 64-65 of the draft law. 
See  amendments  introduced  in  Article  3(2)  points  (5)-(6),  Article  17(4)(5)  and  Article  21(4)  of  the  Law  on  NBP  by 
Article 85(1)-(3) of the draft law. 
See paragraph 3 of ECB Opinion CON/2008/53. 

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