Poland’s largest bank PKO BP enjoys huge loss-to-profit turnaround in Q3

By bne IntelliNews November 10, 2023

Warsaw-listed PKO BP, Poland’s largest lender by assets, posted a net profit of PLN2.78bn (€630mn) in the third quarter, marking a changeover from a net loss of PLN253mn in the same period last year, the bank said in a market filing on November 9.

The net result comes in at 14% above the consensus line that had assumed a PLN2,45bn net take.

PKO BP attributed the record quarterly result to sustained revenue growth, robust cost efficiency and stable credit risk costs.

The bank opted not to establish reserves for legal risks associated with CHF mortgage loans in the third quarter.

PKO BP's interest income totaled PLN4.66bn, surpassing analysts' expectations by 3% and ballooning 558% year on year. Polish banks still enjoy high income from interest, as the central bank’s reference interest rate remains elevated at 5.75% despite having been cut by a combined 100bp in September and October.

The National Bank of Poland put monetary easing on hold in November with expectations now shifting slightly to interest rates remaining at 5.75% until the end of the year and throughout most of 2024.

PKO BP’s fees and commissions income was PLN1.18bn, exceeding market expectations by 2%, the bank also said. It also marked a gain of 1% in y/y terms.

The reserve balance was PLN 276mn in Q3, falling 40% y/y and coming in at 10% below the consensus line.

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