After three quarters of 2021, the net loss of the Bank Millennium group amounted to PLN 823 million. All because of the costs related to franchise holders.
CJEU judgments meant that banks usually lose in court with their clients who inadvertently took a foreign currency loan years ago to buy a flat. Were it not for the costs of losing hearings and settlements with those franchise holders who did not go to court, Millennium’s net profit would have amounted to PLN 791 million. This means that over one and a half billion zlotys went into costs related to franchise holders.
See also: The Frankish people are afraid of the banks’ retorts
“We make every effort to solve this road challenge together with our customers amicable settlements, the number of which has been recorded since the beginning of this year. outnumber new lawsuits“- it was written in the press release.
The bank said in a statement that the main financial effects of the foreign currency mortgage portfolio will be revealed by 2023. Therefore, the current year will not be the last when it will be a burden for Millennium. Without including the costs of foreign currency loans, according to its own forecasts, the bank would earn a billion zlotys this year, which would be its historic record.
The text continues below the video
Currently, the foreign currency loan portfolio accounts for 14 percent. all loans granted by Millennium. The bank said that it aims to reduce this proportion to approx. 7 percent. Over the next 12 months, it wants to maintain the pace of negotiations with clients on concluding agreements on foreign currency loans.
Revenues sharply up thanks to NBP interest rates
It is not certain, however, that the bank will not start generating profits. The bank announced that in 2024 compared to 2021, taking advantage of the market growth (Millennium assumes that all business segments will grow above 10% annually), the environment of higher interest rates and by gaining greater market share, it intends to achieve 50% increase in total revenues (sum of revenues of major business segments before consolidation adjustments) mainly due to retail banking.
– Looking to the future, I am optimistic. Bank Millennium is fully ready for the challenges of the future – said Joao Bras Jorge, President of the Management Board of Bank Millennium.
See also: Official mBank communiqué regarding franchise holders. “Let’s meet halfway”
It plans to significantly increase the number of active customers to over 3 million in 2024. This means an increase by about 100,000. net per year and the expected market share of new personal accounts at the level of approx. 9%.
– In the new strategy until 2024, we assume intelligent growth using the key competences of our employees and the strengths of the organization, further technological progress and positive market opportunities. We want to maintain high operational efficiency and strengthen customer acquisition based on the growth engines developed in recent years – sales of personal accounts, cash and mortgage loans. The core values of our activities remain unchanged. These are customer-centricity, accelerated digitization, in which the center is a mobile application that facilitates daily banking for customers and commitment to society and the environment, including the pursuit of climate neutrality – he added.
The bank assumes that 80 percent sales will run through digital channels, or self-service, and that 99 percent of it would be realized in this way. all transactions.
See also: The Frankivskis are complaining about the Supreme Court’s resolution to the European Commission
– Our current customer service capabilities are much greater than four years ago, when we announced the previous strategy. First, we are a much larger bank today. We have 2.7 million active customers (1.6 times more than 4 years ago) and 83 percent. of them actively use digital channels (previously 71%); we have approximately PLN 80 billion in total loans (1.55 times more than in 2017); and our total revenues (net banking revenues) should exceed PLN 3.5 billion this year (75% more than 4 years ago) – added Joao Bras Jorge.
In the announcement, the bank emphasizes its ecological commitment, which is manifested, among others, by in not providing financing for new coal mines and investments in energy based on coal sources, with the exception of new investments related to the reduction of pollution. Industries directly related to mining at the end of Q3 this year. accounted for 0.96 percent. corporate loan portfolio and 0.27 percent. the entire portfolio of the Bank Millennium Group.