Polish banks benefit from operating in a country showing economic resilience, which did not enter into recession in 2009. Overall, the Polish banking system has weathered the crisis well so far. Capitalization in the system is at a healthy 13.1% level and the rate of earnings retention was close to 100% in 2008. Nonetheless, banks' fundamentals have deteriorated in the worsening economic environment. Notably asset quality has suffered a blow and earnings generation has seen a severe contraction in 2009.