Bank Millennium no longer loss-making, €54M profit in Q1

Bank Millennium, BCP’s Polish bank, posted a profit of PLN 252 million (€54 million) in the first three months of the year, positive values for the second consecutive quarter after a long period of quarters with negative results.

In the same period of 2022, Bank Millennium reported a loss of PLN 122.3 million (€26.4 million at the time), penalised by “provisions related to legal risks associated with the mortgage loans portfolio”.

Today, in a statement sent to the Portuguese Securities Market Commission (CMVM), BCP – which holds 50.1% of the Polish bank’s capital and which consolidates in its accounts by the comprehensive method – said the positive results in the first three of 2023 were achieved “despite high charges related to the portfolio of loans denominated in Swiss francs”.

These charges totalled PLN 940 million after tax, €200 million, including the additional provision of PLN 337 million (€72 million), as announced on 5 April, reflecting the application of more conservative adjustments to the methodology for calculating these provisions in anticipation of potential negative trends, BCP explained.

BCP added that “net income adjusted for charges related to the portfolio of loans denominated in Swiss francs and considering a theoretical level of the bank tax, would have corresponded to a profit of PLN 1.093 billion after tax (€232 million).

BCP pointed out that in the first quarter, Bank Millennium also recorded the extraordinary positive result of PLN 597 million before tax (€127 million), resulting from the beginning of the strategic cooperation for the ‘bancassurance’ [banking and insurance] business and which materialised in the sale of 80% of the stake in the subsidiary Millennium Financial Services.

“Excluding this impact, the adjusted result would have been PLN 609 million (€129 million),” it said.

The Portuguese bank said that in the first quarter, net interest income increased 31% year-on-year and 1% in the quarter, net commissions decreased 9% year-on-year and 1%.

In relation to operating costs, BCP noted that they increased 7% year-on-year and 11% quarter-on-quarter, however, substantially below the level of inflation registered in Poland.

Operating income increased 77% year-on-year and 34% quarter-on-quarter.

In terms of customers, BCP said that Bank Millennium (Poland) now had more than 2.92 million, an increase of 36,000 quarter-on-quarter and 183,000 year-on-year.

In the business customer segment, the Polish bank registered a 7% year-on-year reduction in corporate deposits, as well as a 2% reduction in loans to companies, compared to the same period last year.