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mBank SACORRECTION: mBank lender expects lower CHF loan provisions in '25, but slight increase in CoR
mBank, the Warsaw-listed unit of Germany's Commerzbank, expects CHF loan provisions to fall further in 2025, credit risk costs should be slightly higher than in 2024. The bank expects fee and commission income to increase this year and interest income to decrease if interest rates fall, the bank's representatives said on Thursday.
mBank expects total revenues to exceed PLN 11 billion (EUR 2.6 bln) in 2025, but to be slightly below the level achieved in 2024. In 2024, total income amounted to PLN 12 billion (EUR 2.9 bln), 11 percent higher than in 2023. Net interest income grew 8 percent year on year and commission income by 3 percent.
"Our baseline scenario for 2025 assumes interest rate cuts. If this scenario materialises, we expect a decline in net interest income, but if rates remain at current levels for longer, then this will have a very positive impact on our revenues," the bank's CEO Cezary Kocik told a conference.
"At the same time, we expect an increase in net fee and commission income linked to the growth in our customer base and transactions," he added.
In 2025, mBank expects the legal risk costs related to FX loans to significantly weigh on results for the last time. In 2024, the cost of legal risk of FX loans amounted to PLN 4.31 billion (EUR 1 bln), down 12 percent year on year.
The bank expects both corporate and retails loans portfolio to grow above the market in 2025.
The bank's cost of risk in 2024 fell to 49 basis points from 93 basis points in 2023, and was at 69 bps in 2022.
"We expect the cost of risk in 2025 to be a tad higher than in 2024, but lower than in 2023 and should be lower than our long-term expectations from the strategy, which is 80 basis," deputy CEO Marek Lusztyn said.
In the fourth quarter of 2024, the bank had 871 new CHF lawsuits, 31 percent fewer than in the third quarter. At the end of 2024, mBank had reached a total of 22,900 CHF loan settlements. In the fourth quarter alone, it concluded around 3,400 of them.
In 2024, the mBank group had a profit of PLN 2.24 billion (EUR 532.7 mln), compared to PLN 24 million (EUR 5.7 mln) in 2023.
"We have increased market shares in all strategic products in 2024," Kocik said.
Sales of mortgages in 2024 increased by 157 percent year on year to PLN 10.59 billion (EUR 2.5 bln) and non-mortgage loans increased by 32 percent to PLN 11.35 billion (EUR 2.7 bln). Sales of corporate loans increased by 21 percent to PLN 39.9 billion (EUR 9.5 bln) in 2024.
mBank announced on Thursday that its capital base is set to grow further, thanks to the planned issuance of Tier 2 instruments and high profitability.
seb/ nl/ jz/
