Bank Gospodarki Żywnościowej (1975 2000)

Establishment of Bank Gospodarki Żywnościowej

Bank Gospodarki Żywnościowej (BGŻ) was established in 1975 as a result of merger of Centralny Związek Spółdzielni Oszczędnościowo Pożyczkowych (CZSOP) [Central Asso- ciation of Credit Union Cooperatives] and Bank Rolny. At the time of establishment, BGŻ s shareholders were: State Treasury (54%) and 1,663 Cooperative Banks (46%). At the same time, credit union cooperatives were given the possibility of using a common name Banki Spółdzielcze (BS) [Cooperative Banks]. This resulted from the still increasing offer of banking services performed by these entities71. BGŻ took over the assets and liabilities of Bank Rolny and CZSOP (as at 30 June 1975). BGŻ maintained the accounting principles and the chart of accounts prevailing in Bank Rolny. In addition, BGŻ took over from Bank Rolny the working capital and investment loans of social economy entities, the remains of funds on the settlement and current accounts of these entities, and the balances of their investment funds and special-purpose funds.

The scope of BGŻ s activity was significantly limited by the law

The bank s development was significantly limited by the provisions of law. In accordance with the regulations, the income tax on BGŻ s profits amounted to 80% and on the profits of cooperative banks 65%. Such high tax rates significantly impaired the possibility to increase the equity of BGŻ and BS. Unfortunately, also BGŻ s articles of association did not allow for much independence. In accordance with the articles, the Finance Minister dis- charged the supervisory function over the bank and the BGŻ President was appointed and dismissed by the Prime Minister. The only self-government bodies were: for cooperative banks National Convention of BS Delegates, and for Bank Gospodarki Żywnościowej National BGŻ Council72. Establishment of a separate bank to provide financial and credit services for the food industry was aligned with the then strategy of Poland s social and economic develop-

71. Journal of Laws 1975, No. 20, Item 108. Bank Gospodarki Żywnościowej Archives (ABGŻ), file no. 1392, Historical background. The documents found in ABGŻ units often do not have titles and are not paginated.

72. ABGŻ, file no. 1392, Historical background.

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