Magdalena Łapsa-Parczewska, Adviser to the Chair of the KNF, took part in the following discussion panels at the WallStreet Conference: ‘Challenges of the Polish capital market: how to support investors in the era of globalisation, war and a changing economy’ and ‘Covered bonds: a new instrument for retail investors’.

The key points of Magda Łapsa-Parczewska’s contribution:

Discussion panel: ‘Challenges of the Polish capital market: how to support investors in the era of globalisation, war and a changing economy’

‘The presence of the supervisory authority at the WallStreet conference is not only an expression of engagement but also an opportunity to meet with retail investors, who are an important link in the chain of the capital market; without you, this market would not develop,’ Magda Łapsa-Parczewska emphasised.

‘The current situation, both in Poland and in Europe, is of huge importance for the future of the market. We can see a real willingness among supervisors, regulators and legislators to effect change and to reduce the regulatory pressure which has strongly shaped the market in recent years. This is why we are here together with you today. We are engaged, we take part in the debate, and we support changes but we also emphasise that the process of deregulation must be well-though-out and responsible. We welcome the fact that this is the direction set.

Our goal as the supervisor is not only to ensure stability and security of the financial market but also its development,’ she stated. 

‘One of our common goals should be to transfer some part of funds from the banking sector to the capital market in order to finance the innovativeness of the Polish economy. 

A market without risk is a market without profit. We need to change the approach of both investors and the entire regulatory environment. The concept of risk must be brought back into the public debate as a natural thing, inherent to investing and to the development of the capital market,’ Magda Łapsa-Parczewska said.

Discussion panel: ‘Covered bonds: a new instrument for retail investors’

We are carefully following the developments in the market of covered bonds. We can see their potential, both for strengthening the stability of the banking sector and for the development of the economy.

At this stage, it is particularly important for us that banks focus on developing this instrument with retail investors in mind. This will help achieve adequate liquidity of the market, which is one of key success factors for any financial instrument.

We support striving for a change in the structure of bank financing, with the share of covered bonds being increased. This solution supports the stability of the financial sector and promotes the development of the economy.

We can see an important barrier, though: limited awareness among investors of what covered bonds really are. This is why we emphasise that education in this area will be of key importance. As the UKNF, we declare our willingness to cooperate and support educational activities. We would like each investor making a decision on the purchase of covered bonds to precisely understand the specific nature of covered bonds and the risks involved. Only then is it possible to make informed and responsible investment decisions.

Finally, one should be reminded of a fundamental rule that ‘from the retail investor’s perspective, it is always a good idea to have your portfolio diversified,’ Magda Łapsa-Parczewska added.