UPDATE: mBank lender posts PLN 837 mln net profit in Q3 2025, below expectations

The expectations of eight brokerage houses regarding the bank's net profit in the third quarter of 2025 ranged from PLN 870 million (EUR 205.3 mln) to PLN 975 million (EUR 230.1 mln).

The bank announced that the main factors determining the group's result in this period included a stable level of income compared to the previous quarter, higher operating costs (including depreciation) caused mainly by an increase in marketing costs, legal risk costs related to foreign currency loans, which were significantly below the level of the previous quarter, and continued organic growth.

mBank's net interest income in the third quarter amounted to PLN 2,461.3 million (EUR 580.9 mln), in line with the PAP Biznes consensus and down by 4.3 percent year on year and by 1.4 percent on the quarterly basis.

The interest margin fell in quarterly terms to 3.9 percent, against 4.1 percent in the previous quarter.

The bank's net provisioning reached PLN 580.2 million (EUR 136.9 mln), 3.7 percent above the market expectations, increasing by 16.2 percent on the annual basis while falling by 0.3 percent in quarterly terms.

Total operating expense (OPEX) amounted to PLN 929.5 million (EUR 219.4 mln), in line with the market expectations. In the third quarter, mBank saw its total costs rising by 14.3 percent year on year and by 3.3 percent on the quarter-on-quarter basis.

In the third quarter of 2025, employee costs were stable in quarterly terms, while material costs were seen rising by 12.6 percent.

Cost efficiency, measured by the cost-to-income ratio, was 29.2 percent.

mBank's balance of provisioning turned out 3.5 percent higher than the analysts' expectations, amounting to PLN 206.5 million (EUR 48.7 mln). The lender saw its provisioning balance rising by 8.1 percent year on year and by 59.4 percent in quarterly terms.

Risk costs amounted to 0.61 percent against 0.4 percent in the second quarter.

mBank reported that the increase in risk costs in the corporate and investment banking segment was mainly due to the creation of provisions for two corporate customer exposures, while the quality of the corporate portfolio remained stable.

Legal risk costs related to foreign currency loans amounted to PLN 455 million (EUR 107.4 mln). The bank had previously estimated the legal risk costs related to FX-indexed loans at PLN 426.7 million (EUR 100.7 mln).

The value of net loans and advances at the end of September 2025 amounted to PLN 136.3 billion (EUR 32.2 mln), up 2.4 percent compared to the end of the first half of 2025. The volume of loans granted to individual customers increased by 3.7 percent quarter on quarter, and to corporate customers - by 0.6 percent.

In the third quarter of 2025, the mBank group sold mortgage loans worth PLN 4.574 billion (EUR 1.08 bln). The volume of mortgage loan sales was 24.4 percent higher on the quarterly basis and 37 percent higher year on year.

Sales of non-mortgage loans reached PLN 3.378 billion (EUR 797.2 mln), down 4.1 percent quarter on quarter, but up 19.6 percent on an annual basis.

Gross loans increased by 9.6 percent year on year, and deposits rose by 10.6 percent.

In its outlook for 2025, mBank stated that total revenues will be significantly above the reported level for 2024, exceeding PLN 12 billion (EUR 2.83 bln), with stable interest rates until the end of the year.

The bank maintained that the legal risk costs associated with foreign currency loans will be a significant burden on financial results for the last time in 2025.

The total capital ratio at the end of September 2025 was 16.7 percent, and the Tier I capital ratio stood at 14.5 percent. The surplus over Poland's financial watchdog KNF's capital requirements was 4.7 percentage points for the total capital ratio and 4.5 percentage points for the Tier I ratio.

seb/ ao/