Most of the Group subsidiaries also rank high in their respective financial services market segments. The table below presents the market share and the position of mBank and of selected subsidiaries at he end of 2017 compared to 2016 and 2015:

mBank Group operates in a changing market environment. Currently, the following factors impact the operations of the banking sector in Poland:

• A low interest rate environment – interest rates in Poland are at historically low levels – the NBP reference rate stood at 1.5% and WIBOR 3M reached 1.72% at the end of 2017. The low interest rate environment depresses generation of net interest income.
• Limited interchange rates, i.e. commissions paid to the bank by the settlement agent for every noncash transaction made with a payment card issued by the bank, to the level of 0.2% for debit cards and 0.3% for credit cards (from the end of January 2015). It restricts the generation of net fee
  and commission income.
• The introduction of a new tax on certain financial institutions (so called „bank tax”) in February 2016 in the amount of 0.44% of assets annually. 2017 was the first year when banks paid tax for 12 months.
• Stricter regulatory requirements, putting pressure on capital, costs as well as operations.
• Proposals to convert the mortgage FX loans, mainly CHF loans, to PLN, and currently ongoing work on the President’s bill changing the act on the support of troubled borrowers who have taken out a mortgage loan. It assumes the creation of two funds, of which one would support the voluntary conversion of mortgage loans in foreign currency (for more information see chapter 2.2. Regulatory environment).

• Consolidation of the banking sector – banks with insufficient scale give way to bigger and stronger entities. Consequently, the share of five largest institutions in total banking assets in Poland grew from 43.9% in 2010 to 47.8% at the end of 2017 (according to PFSA).
• Challenges related to the management and storage of personal data and deposits security in the Internet – so-called cyber risk.
• Spreading technological solutions and demographic processes change clients’ behaviour. Customers increasingly prefer to bank outside of the branches as their main contact center with banks.
• Declining trust in the banking sector as a result of the ongoing debate in relation to the FX mortgage loans, started on 2015.
• Non-financial sector players (FinTechs) are gradually entering traditional banking territories and offer innovative financial solutions. Additionally, the PSD2 Directive (Payment Services Directive 2) as of November 2015 will abolish banks’ monopoly in the market for payment services (Poland will implement the EU law in Q1 2018).