Polish banks will need to look for alternative sources of income in 2025 - banking lobby
In 2025, Polish lenders will need to look for alternative sources of income and ways to diversify their portfolios to mitigate the effect of a decline in interest income after interest rate cuts. The risk of undermining foreign currency, PLN and consumer loans will continue to be a challenge for banks, the Polish banking lobby ZBP assessed.
ZBP reported that the dependence of financial results on interest income means that a reduction in interest rates could significantly reduce banks' interest results. Interest from debt instruments (mainly Treasury bonds) remains a factor stabilising banks' interest results.
"More than 81 percent of the Polish banking sector's financial results are created by interest income generated in a high interest rate environment," ZBP pointed out in the presentation.
"The current result, achieved in conditions of high interest rates, should therefore be treated as a transitional state; and as an opportunity to lay the foundations for a greater contribution of the banking sector to the expected growth of investments (including private investments)," it added.
The Polish banking lobby reported that the next CJEU rulings remain uncertain.
"It is imperative to build adequate provisions for legal risks that will affect the financial results and image of the entire banking sector," ZBP stressed.
It was reported that in 2024, the domestic banks paid PLN 13.4 billion (EUR 3.1 bln) in CIT (tax for businesses) and PLN 5.9 billion (EUR 1.4 bln) in banking tax, which accounted for nearly 16 percent of total operating income.
Dividends to the State Treasury amounted to PLN 3.49 billion (EUR 815.96 mln). Total receipts to the state budget from the banking sector amounted to PLN 24.16 billion (EUR 5.65 bln).
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