10. Fee and commission income and expenses
Accounting policies
The Group recognizes fee and commission income that is not accounted for using the effective interest rate in such a manner so as to reflect the transfer of the goods or services promised to a customer in an amount reflecting the consideration to which – in accordance with the Group’s expectations – it will be entitled in return for the goods or services in accordance with the five stage model for recognizing income referred to in note 5 IFRS 15 “Revenues from contracts with customers”.
Fee and commission income includes one-off amounts charged by the Group for services not related directly to the creation of financial assets, as well as amounts charged by the Group for services performed which are recognized on a straight-line basis. Fee and commission income also includes fees and commissions recognized on a straight-line basis, received on loans and advances granted with an unspecified schedule of future cash flows for which the effective interest rate cannot be determined.
2018
Upon concluding a contract for the provision of a performance, the Group assesses whether it will be capable of meeting the obligation to make the performance gradually, or whether it will make the performance at a specific date.
The accounting policies for recognizing commission income on sales of insurance products linked to loans and advances are described in the note 9 “Interest income and expenses”.
Financial information
| Net fee and commission income | 2018 | 2017 |
|---|---|---|
| Loans and insurance | 761 | 710 |
| Investment funds, pension funds and brokerage activities | 794 | 803 |
| Cards | 530 | 502 |
| Bank accounts and other | 928 | 954 |
| Total | 3 013 | 2 969 |
| Fee and commission income | 2018 | 2017 |
|---|---|---|
| Loans and insurance | 761 | 710 |
| lending | 636 | 616 |
| offering insurance products | 125 | 94 |
| Investment funds, pension funds and brokerage activities | 833 | 839 |
| servicing of investment funds and OFE (including management fees) | 640 | 590 |
| servicing and selling investment and insurance products | 51 | 73 |
| brokerage activities | 142 | 176 |
| Cards | 1 243 | 1 126 |
| Bank accounts and other | 1 205 | 1 243 |
| servicing bank accounts | 836 | 858 |
| cash transactions | 90 | 98 |
| servicing foreign mass transactions | 104 | 101 |
| sale and distribution of court fee stamps | 1 | 5 |
| customer orders | 46 | 44 |
| fiduciary services | 6 | 6 |
| other | 122 | 131 |
| Total | 4 042 | 3 918 |
| Fee and commission expense | 2018 | 2017 |
|---|---|---|
| Investment funds, pension funds and brokerage activities | (39) | (36) |
| Cards | (713) | (624) |
| Bank accounts and other | (277) | (289) |
| commission paid to external entities for product sales | (55) | (61) |
| cost of construction investment supervision and property valuation | (44) | (41) |
| settlement services | (31) | (29) |
| fee and commissions for operating services provided by banks | (15) | (19) |
| sending short text messages (SMS) | (27) | (21) |
| other1 | (105) | (118) |
| Total | (1 029) | (949) |
1 Among other things on servicing loans, servicing foreign mass transactions, central settlement of derivative transactions, issue of Euro bonds and canvassing services.
| Fee and commission income by segment | 2018 | |||
|---|---|---|---|---|
| Retail segment | Corporate and investment segment |
Transfer centre and other |
Total | |
| Loans and insurance | 593 | 168 | – | 761 |
| lending | 478 | 158 | – | 636 |
| offering insurance products | 115 | 10 | – | 125 |
| Investment funds, pension funds and brokerage activities | 719 | 114 | – | 833 |
| servicing of investment funds and OFE (including management fees) | 631 | 9 | – | 640 |
| servicing and selling investment and insurance products | 51 | – | – | 51 |
| brokerage activities | 37 | 105 | – | 142 |
| Cards | 1 201 | 42 | – | 1 243 |
| Bank accounts and other | 961 | 244 | – | 1 205 |
| servicing bank accounts | 752 | 84 | – | 836 |
| cash transactions | 61 | 29 | – | 90 |
| servicing foreign mass transactions | 61 | 43 | – | 104 |
| sale and distribution of court fee stamps | – | 1 | – | 1 |
| customer orders | 27 | 19 | – | 46 |
| fiduciary services | – | 6 | – | 6 |
| other | 60 | 62 | – | 122 |
| Total | 3 474 | 568 | – | 4 042 |