Santander Bank Polska SA (FRA:BZI) Q3 2024 Earnings Call Highlights: Strong Profit Growth Amid ...

GuruFocus News
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In This Article:

  • Gross Profit: PLN5.8 billion after three quarters; PLN2.6 billion in Q3.

  • Net Profit: PLN4.3 billion after three quarters; PLN1.939 billion in Q3.

  • Net Interest Income: PLN10.249 billion after three quarters, up 6% year-on-year; PLN3.6 billion in Q3, up 5% year-on-year.

  • Net Fee Income: PLN2.184 billion after three quarters, up 9% year-on-year; PLN727 million in Q3, up 9% year-on-year.

  • Total Income: PLN12.7 billion after three quarters, up 7% year-on-year.

  • Return on Equity: 20.5% for the group.

  • Liquidity Coverage Ratio (LCR): 206%.

  • Customer Deposits: Grew by 4% year-on-year to over PLN218 billion.

  • Gross Loans Portfolio: Grew by 8% year-on-year to nearly PLN200 billion.

  • Operating Costs: Over PLN3 billion after three quarters, up 9% year-on-year.

  • Cost-to-Income Ratio: 30% after three quarters.

  • Credit Provisions: PLN908 million after three quarters; PLN297 million in Q3.

  • Cost of Credit Risk: Stable at around 70 basis points.

  • Legal Risk Costs: PLN1.6 billion after three quarters.

Release Date: October 29, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Santander Bank Polska SA (FRA:BZI) reported a gross profit of PLN5.8 billion after three quarters, with PLN2.6 billion generated in the third quarter alone.

  • The bank's digital customer base has grown significantly, with 4.5 million digital customers and 3.5 million mobile banking customers, marking a year-on-year increase of 7% and 12%, respectively.

  • Customer deposits increased by 4%, and the gross loans portfolio grew by 8% year-on-year, reaching nearly PLN200 billion.

  • Net interest income rose by 6% year-on-year to PLN10.249 billion, with a 5% increase in the third quarter compared to the same period last year.

  • The bank's return on equity stands at a robust 20.5%, and it maintains excellent liquidity with a Liquidity Coverage Ratio (LCR) of 206%.

Negative Points

  • The bank faced a significant tax burden of PLN2.3 billion and regulatory costs of PLN284 million, totaling over PLN2.6 billion, which matched the gross profit for the third quarter.

  • Operating costs increased by 9% due to higher banking guarantee fund contributions and inflation-driven expenses, including a 9% rise in staff costs.

  • The net balance of credit provisions after three quarters was PLN908 million, with a stable cost of credit risk around 70 basis points.

  • The bank experienced a downgrade in the Corporate segment, leading to a growth in Non-Performing Loans (NPLs) by 30 basis points, although the NPL ratio remains below 5%.

  • There is uncertainty in the mortgage market due to ongoing discussions about a new support program, which has affected sales in the third quarter.

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