Reinforcement of provisions for FX mortgage loans will push BCP’s Polish bank into losses
The Polish bank controlled by BCP reinforced the provisions due to legal risk connected with FX mortgage loans. It will report losses in the third quarter.
Bank Millennium, the Polish bank controlled by BCP, decided to reinforce the provisions for legal risk connected with FX mortgage loans. In this sense, the bank warns it will report losses in the third quarter of this year.
“The Management Board of Bank Millennium S.A. (‘the Bank’) informs that it took a decision to create in its 3rd quarter 2021 accounts, PLN 451.8 million of provisions for legal risk connected with FX mortgage loans originated by the Bank.”
Also, “additional PLN 74.3 million provisions will also be created against legal risk related to the loan book originated by Euro Bank but without a bottom line impact,” the bank said in a statement sent to CMVM.
In total, the institution will set aside provisions of €115.46 million because of this loan book, which will impact the bank’s accounts in the third quarter. “As a result of this level of provisions, despite solid operating performance, the Bank expects a negative net result in the 3rd quarter of 2021,” it added.
At last, Bank Millennium says the additional provisions it is now announcing “reflect the continuing negative trends in court decisions, inflow of new court cases and resultant changes in the Bank’s legal risk assessment methodology.”
