mBank (MBK) Q2 2024 earnings summary

Executive summary

• Focus on strengthening equity base and capital position by retaining all 2024 profits, with no dividend to boost capital by ~50 bps and maintain buffers well above regulatory minima.

• Delivered strong net profit and business growth, supported by record net interest income, improved fee income, and robust loan and deposit expansion.

• Ongoing priority to resolve Swiss franc mortgage portfolio issues, with settlements outpacing new court cases and highest coverage ratio among peers.

• Ambition to regain and expand market share, leveraging organic growth and improved capital position.

• Management Board changes underway, with succession process following President's resignation.

Financial highlights

• Q2 2024 net profit reached PLN 422 million, up 60.7% sequentially and a turnaround from a loss in Q2 2023.

• Net interest income (excluding credit holidays) hit a record PLN 2,421.5 million, up 3.5% quarter-on-quarter and 9.5% year-over-year.

• Group revenues declined marginally due to PLN 257 million credit holiday impact; excluding this, revenues rose 7.7% quarter-on-quarter.

• Cost-income ratio at 27%, well below the long-term target of 40% and improved year-over-year.

• Return on equity (ROE) for core business at 40%, group ROE close to 10%, and net interest margin at 4.44%.

Outlook and guidance

• 2024 total income expected to exceed PLN 11 billion, a historic high.

• No dividend will be paid from 2024 profit; retained earnings to support dynamic growth and capital buffers.

• NII and net fee/commission income both forecasted to be higher than 2023, with loan volumes expected to rebound.

• Cost of risk guided below 70 bps for 2024, with normalization expected in H2 after a low H1.

• Asset quality expected to remain stable, but macro and geopolitical risks are monitored.