In Q2 2019, mBank Group earned a net profit of PLN 331.6 million, up from PLN 164.0 million in Q1. The figure was affected by an increase in the banking tax and positively impacted by income tax averaging.
Compared with the previous quarter, the financial performance of mBank Group in Q2 2019 was affected by the following factors:
- Increase in net interest income by PLN 67.5 million or 7.3%, attributable mainly to higher interest income (+5.2% QoQ) driven by growing volumes of retail and corporate loans and a structural shift in the credit portfolio;
- Decrease in net fee and commission income by PLN 3 million or 1.3% related to higher expenses;
- Net trading income remaining at the high level reported in the previous quarter;
- Decrease in operating expenses (incl. amortisation/depreciation) by PLN 178.7 million or 25% compared with Q1 when the annual contribution to the Bank Guarantee Fund’s resolution fund was recognised;
- Increase in net impairment losses and fair value change on loans and advances (by PLN 78.3 million) due to higher impairment losses in Corporate Banking and Financial Markets - up from PLN 31.4 million in Q1 to PLN 92.6 million in Q2 2019. Net impairment losses and fair value change on loans and advances in Retail Banking amounted to PLN 131.3 million in Q2 compared with PLN 114.3 million in
- Increase in the banking tax paid by the Group to PLN 149.7 million. Upon review of its approach to certain transactions applied in the previous years, the bank created a provision of PLN 41.6 million for potential additional banking tax payments in Q2 2019.
- Decrease in the income tax rate.
Loans and advances grew by PLN 2.7 billion or 2.8% in Q2 2019. Higher volumes were reported in both Retail Banking (+PLN 1.97 billion or 3.6%) and Corporate Banking (+PLN 865 million or 1.9%). In Q2 2019, mBank Group sold PLN 2.2 billion worth of retail mortgage loans and PLN 2.6 billion worth of retail non-mortgage loans.
At the same time, amounts due to clients went up by PLN 2.7 billion or 2.5%. Amounts due to individuals and corporate clients expanded by PLN 2 billion or 3% and PLN 463 million or 1.2%, respectively, thanks to an increase in deposits in current and savings accounts.
- As a result of simultaneous growth in loans and deposits, the loan-to-deposit ratio reached 91.0%.
- High quality of capital base - the Bank’s capital ratios are above regulatory requirements with CET1 and TCR at 16.7% and 19.7%, respectively.