ING Bank Slaski (ING) Q2 2024 earnings summary

Executive summary

• Q2 2024 net profit was PLN 964.7 million, down 12% year-over-year, mainly due to the credit vacation program and higher risk costs; H1 2024 net profit was PLN 1,958.0 million, a 2–2.5% decrease year-over-year.

• The bank acquired over 60,000 new individual and up to 15,000 new SME/corporate clients year-over-year, with strong digital engagement and transaction growth.

• Market share in loans is growing faster than deposits, reflecting the business model's focus.

• ING Bank Śląski maintained its position as the 4th largest bank in Poland, with 4.5 million individual and 568,000 corporate clients.

Financial highlights

• Net interest income for H1 2024 was PLN 4,203.9 million, up 7.4% year-over-year; Q2 2024 NII was PLN 2,041.3 million, down 1% year-over-year, but would be PLN 2,211.3 million (+8% y/y) adjusted for credit holidays.

• Net commission income for H1 2024 was PLN 1,147.0 million (+8.7% y/y); Q2 2024 commission income was PLN 571.0 million (+7% y/y).

• Cost to income ratio was 44.6% as of June 2024; cost/income ratio (including bank levy) at 42.9% in Q2 2024.

• Operational costs increased by 12–15% year-over-year, mainly due to higher labor and third-party service costs.

• Cost of risk reached PLN 317.8 million in Q2 2024 (+61% y/y), with most provisions in the corporate sector due to isolated cases.

Outlook and guidance

• Expectation of continued stable growth, with the bank aiming to grow faster than the market and GDP; GDP growth forecast at 3% in 2024.

• Investment activity is expected to remain subdued in 2024, with a rebound anticipated in 2025 as EU funds absorption increases.

• Inflation is projected to rise to 4–5% by year-end 2024, peaking below 6% in March next year; monetary easing expected in 2025.

• The Group continues to monitor macroeconomic and regulatory risks, including the planned replacement of the WIBOR benchmark rate after 2027.