Alior Bank Q1 profit surges 58% as it aims to keep CoR at bay (updated)

Alior Bank SA

25/04/2024 10:25

(Recasts with first-quarter results; adds CFO, Deputy CEO
comments, detail, stock move)
       GDANSK, April 25 (Reuters) - Poland's Alior Bank
 ALRR.WA  reported on Thursday a 58% yearly rise in net profit
to 578.1 million zlotys ($142.9 million) on interest revenues
from hedging instruments, growth of credit portfolio and
securities.
        Net interest income rose 15% to 1.27 billion zlotys and
net interest margin climbed 15 basis points to 5.96%, Alior
said.
        The lender managed to improve its credit portfolio
quality and increase its size. Its quarterly sales of mortgage
loans more than quadrupled to 1.64 billion zlotys, supported by
1.2 billion zlotys from the Safe 2% Credit scheme.
        At the same time, its quarterly cost of risk (CoR) came
in at 0.68% compared with 1.61% in the year-ago quarter, while
the provisions for expected credit losses declined 55% to a
little over 111 million zlotys.
        The bank said it expected to keep annual CoR below 1%,
as it did not see any risks that could hike its loan loss
provisions so far.
    It also estimates that it will achieve a non-performing
loans ratio (NPL) below 7% in 2024, and expects a further drop
below 5% to be possible within a two-year horizon, deputy chief
executive officer Tomasz Miklas said on conference call.
        Alior's first-quarter NPL came in at 7.65% compared with
9.80% in the last year's period, as the lender continued to
improve credit risk management in a bid to reach a strategy goal
of less than 10%.
  
        A successor to the current two-year strategy is set to
be presented in the fourth quarter, said CFO Radomir Gibala.
  
    The bank's stock opened up 2% but reversed course later,
falling by 1.1% by 0921 GMT.
($1 = 4.0465 zlotys)

 (Reporting by Mateusz Rabiega; Editing by Varun H K and Mark
Heinrich)
 ((Mateusz.Rabiega@thomsonreuters.com; +48 58 769 67 57;))