Poland's PKO BP says banks need a shift in business model as lower rates squeeze results

Powszechna Kasa Oszczednosci Bank Polski SA

13/01/2026 13:01

WARSAW, Jan 13 (Reuters) - The CEO of Poland's biggest bank by assets PKO BP PKO.WA is optimistic for the full year, but said further growth in earnings will require a shift in the business model as falling Polish interest rates squeeze lenders' results.

High interest rates that drove strong interest income have helped Polish banks post record profits in recent years, but the National Bank of Poland cut rates six times last year by a total of 175 basis points, bringing the main rate down to 4.00%.

"We cannot base further growth of the results... on the interest margin," PKO CEO Szymon Midera said.

"We are now operating in a completely different interest rate environment. We need to prioritize (financing) investment and transactional activity," he added.

GROWTH

PKO BP economists forecast Polish GDP growth will accelerate to 3.7% this year from 3.5% in 2025, driven mainly by investment, which is expected to jump 12% from around 6% last year.

The bank reported a 15% year-on-year rise in third-quarter profit, supported by a 6% increase in net interest income. The sector as a whole posted a gain of more than 12% to 12.7 billion zlotys ($3.52 billion).

Midera said consolidation in Poland's banking sector is inevitable given the relatively low concentration of the largest banks compared with other European countries.

Krzysztof Dresler, PKO's chief financial officer, said the bank is focusing on organic growth, but does not rule out acquisitions.

UKRAINE

PKO focuses mainly on Poland, but has several branches abroad and owns Ukrainian lender Kredobank.

Midera said the bank was preparing to be "an active financial player" in the process of rebuilding Ukraine once the war ends.

"Many Polish companies are interested in participating in investments or the reconstruction of Ukraine, and we would like our Kredobank to play a role in this," he said.

($1 = 3.6092 zlotys)

 (Reporting by Anna Koper and Pawel Florkiewicz; Editing by Jan Harvey)

 ((anna.koper@thomsonreuters.com;))