Bank Millennium (MIL) Q2 2025 earnings summary

Executive summary

• Net profit for H1 2025 reached PLN 511 million, up 43% year-over-year, with Q2 net profit at PLN 331 million, and total comprehensive income at PLN 633.8 million.

• Adjusted net profit excluding FX mortgage legal risk costs was PLN 1.6 billion, a 7% year-over-year increase.

• Strong asset quality, liquidity, and capital position maintained, with LCR at 414% and TCR at 15.6%.

• Digital transformation and customer acquisition continued, with 93% of retail clients digitally active.

• Strategy execution on track, focusing on corporate lending and outlining key financial and business targets for 2028.

Financial highlights

• Net interest income for H1 2025 was PLN 2.87 billion, up 13% year-over-year; net interest margin at 4.18%, down 13 bps year-over-year.

• Net fee and commission income was PLN 370.6 million, down 5% year-over-year due to lower bancassurance fees.

• Cost-to-income ratio (adjusted) at 34%; operating costs up 15% year-over-year.

• Extraordinary low cost of credit risk at 21 bps, aided by NPL sales.

• Trading gains in Q2 included a PLN 55 million revaluation of an investment stake.

Outlook and guidance

• NII expected to remain flattish or slightly up year-over-year, with low sensitivity to interest rate cuts.

• Gradual recovery in fee and commission income anticipated, mainly single-digit growth.

• Cost of risk guidance reflects positive impact from NPL sales; full-year cost of risk expected to remain low.

• Legal risk provisions for FX mortgages expected to trend downward, with 2025 likely the last year of significant impact barring extraordinary events.

• The bank remains focused on amicable settlements for FX mortgage disputes and is monitoring legislative changes.