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Banco Comercial Português, S.A. informs about Bank Millennium (Poland) results in 1Q 2020

Written by Customer Service on . Posted in Earnings Releases And Operating Results.

Banco Comercial Português, S.A. informs about Bank Millennium (Poland) results in 1Q 2020Banco Comercial Português, S.A. hereby informs that Bank Millennium in Poland, in which it has a 50.1% holding and whose accounts are fully consolidated at BCP group level, released today its results for 1Q 2020. Main highlights are as follows:Profitability affected by integration costs and extraordinary provisionsNet profit reached 18.1 million PLN (4.2 million EUR) in 1Q 2020, or 190 million PLN (43.7 million EUR) when adjusted to extraordinary items/one-offs* (stable y/y)30.1 million PLN (6.9 million EUR) of integration costs related to Euro Bank, with synergies reaching 24 million PLN (5.5 million EUR)55.3 million PLN (12.7 million EUR) increase of provisions related to foreign exchange (FX) mortgages legal risks60 million PLN (13.8 million EUR), or 49 million PLN (11.3 million EUR) after tax, of pre-emptive Covid-19 related provisionsAdjusted* ROE of 8.4% and Cost/income ratio of 48.3%Higher operating income and costs influenced by the merger of Euro BankOperating income grew 24% y/yNet interest income grew 38% y/yNet commission income grew 19% y/yOperating costs grew 35% y/y (28%, excluding integration costs), and decreased 5% q/q (excluding integration and Bank Guarantee Fund costs)High asset quality and liquidity keptImpaired loans (stage 3) ratio at 4.75%Cost of Risk** at 108 b.p. (75 b.p., excluding pre-emptive Covid-19 provisions)Loans to deposits ratio at 86% Solid capital position and lower regulatory buffersGroup’s Total Capital Ratio (TCR) at 19.5%, and CET1 ratio at 16.5% after incorporating full 2H 2019 profits, comfortably above requirements (15.4% and 12.2%, respectively)Reduction by the KNF of the FX mortgage related Pillar 2 buffer to 4.9%, in November 2019, and cut of the Systemic risk buffer to 0%, from 3%, in March 2020Retail business2.6 million active clients, a 34% y/y growth, +708 thousand new clients after one year, including +494 thousand due to the Euro Bank acquisitionDeposits grew 32% y/yLoans grew 47% y/y (72%, excluding FX mortgages)1.3 billion PLN (285 million EUR) in mortgages and cash loans origination, which translates in a high y/y growth of the respective loan books: 57% and 31%, respectivelyAccelerating the new microbusiness accounts acquisition pace, +20 thousand net growth of active accounts (24% of new accounts were opened online)96 thousand microbusiness clientsCompanies businessCurrent accounts volumes grew 39% y/yGrowth of loans to companies: 7% y/yGrowth in factoring turnover of 6% y/yGrowing number and volume of transactions in corporate businessSupport for Clients during the Covid-19 epidemicRetail Clients:Credit moratoria, temporary deferral of principal and interest instalmentsContactless card transactions up to PLN100 (23 EUR) without PIN confirmationMost transactions can be done safely and remotely from homeFully online current account opening, with the use of selfieWebsite and banner communication on the portal, dedicated to this thematicMicro-companies and corporate customers:Applications for the Polish Development Fund financial support (subsidy with redemption possibility) in Millenet, available for micro businesses and SMEsTemporary suspension of loan instalments, including factoring, leasing and charge cards, available for all companiesQuick and simplified process of credit renewal, available for SMEs and large companiesState Development Bank (BGK) guarantees under new and more favourable conditions for micro businesses and SMEs (de minimis guarantee)Credit lines supported by BGK’s Liquidity Guaranties Fund, available for medium and large companiesPossibility of remote signing of all agreements, available for SMEs and large companiesQuality and InnovationsHighest NPS ratio (52) among Polish banksBest Trade Finance Provider in Poland for 2020, according to Global Finance1.7 million downloads of the Millennium Goodie app – smartshopping platform(*) without one-offs: in 1Q20: 1) integration costs: PLN 30.1mn (6.9 million EUR), 2) PLN 55.3mn (12.7 million EUR) provisions for FX mortgage legal risk, 3) proactive Covid-19 provision of PLN 60mn (13.8 million EUR), 4) linear distribution of BFG resolution fund fee of PLN 58.2mn (13.4 million EUR); in 1Q19: 1) integration costs: PLN 2mn (459 thousand EUR), 2) PLN 26.9mn (6.2 million EUR) release of tax asset provision, 3) linear distribution of BFG resolution fund fee of PLN 73.3mn (16.8 million EUR)(**) on gross loans.End of announcement
Banco Comercial Português, S.A. 
AttachmentResultados Polónia 1T20 EN

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