XVII Forum Funduszy IZFiA – Kazimierz Dolny, 21-22 czerwca 2023 r. Wystąpienie podsumowujące Przewodniczącego KNF

The Polish Financial Supervision Authority, KNF, has published on its website the speech of its Chairman Mr. Jacek Jastrzębski which he delivered at the 17th IZFiA Forum of Funds.
In its speech, the Chairman welcomed this year’s theme of the Forum, namely „the customer’s role in the financial sector“ which is of utmost significance for understanding financial markets developments and for mitigating risks associated with the markets. Particularly the funds industry is strongly driven by the behavior of individual clients and thus it is important, so Mr. Jastrzębski, to reflect on past experiences and possible lessons learned from such. In fact, customer behavior in recent decades has influenced both the growth and decline of funds as a consequence of events like the Lehman Brothers crisis, the Covid-19 pandemic, and interest rate fluctuations. Therefore, the fund industry needs to look at these events and draw the right conclusions to improve their customer „relationships“ as a whole.
Far and foremost, so the Chairman, must investment funds understand the significance of providing accurate and transparent information to customers. The Chairman noted in this context that the low-interest-rate environment in previous years led to the development of fixed-income funds offering attractive returns, sometimes misleadingly labeled as secure. However, recent events have shown that all investments involve risk, and even seemingly safe investment funds can suffer losses. Clients must be aware of these risks, particularly of the market risks in the short term. Providing proper information about these risks and demonstrating how – in the long run – a product can recover from losses in a favorable market environment builds customer awareness and minimizes the risk of disappointed expectations.
Additionally, the Chairman discussed the importance of understanding customer needs and capabilities and aligning services accordingly. He emphasized the role of financial institutions in managing the risks associated with product distribution and ensuring that products are purchased by the intended customer group(s).
To conclude, Mr. Jastrzębski also emphasized that the inclusion of relevant information and warnings in customer documents (e.g. prospectuses) does not absolve financial institutions of their responsibility for risks related to mismatches between customer needs and purchased products. It is the responsibility of financial institutions to ensure the products they distribute are in line with customers‘ needs, their capabilities, and their financial situations.