The economic transformation in Poland has dramatically diminished the role of the state in the banking sector. As at the end of September 2003, private investors controlled almost 84% of the sector's ownership capital and around 75% of the banks' assets. As recently as 1993, the respective figures were 15.2% of ownership capital and 13% of banking sector assets. In the context of such changes, the question arises as to the impact of the privatisation processes on changes to the operational efficiency of banking institutions.

In the article, the author reviews selected bibliography on issues concerning the impact of state and private ownership on the performance of the economy and of the banking sector in particular.

The author demonstrates that the impact of the ownership factor on banking sector efficiency has long been a subject of a lively scientific debate. The research papers and projects presented, particularly those which utilise modern methods of measurement and analysis of empirical data, indicate that excessive state ownership has a detrimental impact on the banking sector and as a result on the entire economy. This shows amongst others that state-owned banks are less efficient, both in operational and financial terms, than private banking institutions. Moreover, operations of state-owned banks may be subject to political pressure, which prevents them from efficiently allocating their capital.

However, in order to fully understand the impact of the ownership factor on banking sector efficiency, the presented research results and formulated research hypotheses must be verified in the context of the performance of specific banking institutions operating in specific conditions and under a particular institutional and legal framework. Therefore an analysis of the Polish experience in the area of banking privatisation may serve to provide arguments for the debate as to the desired ownership structure of the banking sector. Such an analysis also allows for a comparison of the condition of different banks - often sharing the same genesis and similar start-up conditions under private and state ownership governance. The histories of Bank Zachodni and Wielkopolski Bank Kredytowy in the years 1989 - 1999 provide a "live laboratory" examples of the impact of privatisation on the condition of a commercial bank. The impact of ownership changes on the condition of both banks during that period will be the subject of analysis in the second part of the article.