Poland's PKO BP first-quarter net profit rises 20.8% (updated)

Powszechna Kasa Oszczednosci Bank Polski SA

13/05/2025 05:57

Adds details on loan sales and interest rates in paragraphs 4-6

GDANSK, May 13 (Reuters) - Poland's biggest bank PKO BP PKO.WA posted a 20.8% year-on-year rise in its first-quarter net profit on Tuesday boosted by improved core business income.

The largest Polish bank by total assets reported a profit of 2.47 billion zlotys ($647.33 million) for the quarter, beating market expectations of 2.44 billion zlotys, according to data in bank-compiled consensus.

The lender's net interest income grew 15.2% to 5.98 billion zlotys. Net interest margin was at 4.95% in the first quarter, compared to 4.58% a year earlier and 5.18% in the fourth quarter of 2024.

New sales of mortgage loans fell 26.7% from a year earlier to 5.8 billion zlotys, while those of consumer loans rose 62% to 7.8 billion zlotys.

On Wednesday, Poland's Central Bank cut the main interest rate by 50 basis points to 5.25% in the first easing since 2023. The market is waiting for further decisions on easing the monetary policy.

Lower interest rates may translate into greater demand for mortgage loans as more people will be able to afford them.

In the first quarter, the bank booked a provision of 973 million zlotys on mortgages in Swiss francs, compared to 1.34 billion zlotys a year ago.

Hundreds of thousands of Poles took out mortgages in foreign currencies, mainly in Swiss francs, in the early to mid-2000s, attracted by lower interest rates.

They are now repaying them in far larger instalments than expected after the Swiss franc soared against the zloty and interest rates in Switzerland were hiked.

The total number of settlements regarding Swiss francs loans concluded as of March 31 was 50,238, of which 41,712 were concluded in mediation and 8,526 in court proceedings.

The bank said in March that it would like to end the "Swiss franc saga" this year.

($1 = 3.8157 zlotys)

 (Reporting by Adrianna Ebert, editing by Milla Nissi-Prussak)

 ((Adrianna.Ebert@thomsonreuters.com; +48 58 769 65 88;))