Unexpected fortunes

Although analysts have been predicting hard times and lost liquidity for the Polish banking sector, three banks surprised the market with their good results last week. Pekao, BPH and BZ WBK all saw y/y revenue growth in Q1, and only BZ WBK had a lower net profit than in the same period last year.

"The general situation on the market is not as bad as was predicted," said Leszek Sołtysik, director of the financial services advisory team at PricewaterhouseCoopers.

"In my opinion we are still [experiencing boom] years" he told WBJ. "In Q1, the volume of loans and deposits continued to rise, and corporate banking also saw an increase in revenues. Banks' incomes will rise with the rest of the economy, though perhaps a bit slower because higher interest rates are cooling the system," Sołtysik added.

In the first quarter following its takeover of part of bank BPH, Pekao Group had revenues of zł.2.34 billion, a 10.7-percent y/y rise. The bank had a net profit of zł.1.14 billion, 22.8 percent higher than last year's result.

The remnants of BPH, also known as "mini-BPH," saw even higher revenue and net profit increases than Pekao, which had to cover the costs of incorporating the other half of BPH into its structure. The independent BPH had revenues of zł.234.5 million and a net profit of zł.47 million, marking y/y rises of 18 percent and 21 percent respectively.

BZ WBK, meanwhile, earned revenues of zł.760.5 million in Q1, 10.4 percent more than last year. At zł.243.1 million, however, its net profit was 6.7 percent lower than last year. This y/y drop in profit was caused by an intensive advertising campaign and investments, according to BZ WBK.