Polish Millennium Bank CEO João Bras Jorge said on Friday that the bank aims to make 1,000 settlements with clients involving loans in Swiss francs every three months.
“We are aiming for 1,000 settlements (…) Our energy and focus this year is to try to reach as many settlements as possible with borrowers,” Bras said in a press conference after the bank’s third-quarter results.
Hundreds of thousands of Poles have obtained mortgage loans with Polish banks in foreign currencies, especially in Swiss francs, due to low interest rates. However, they now have to pay it back in much larger installments than expected after the Swiss franc rose sharply against the zloty and interest rates in Switzerland rose.
Fernando Picho, chief financial officer of Millennium Bank, also said at the press conference that the bank will not provide estimates on the cost impact of extending the credit reduction plan to borrowers, as the eligibility criteria for the program are still unclear.
Last year, the Polish government introduced a so-called credit holiday to help borrowers adapt to high interest rates in Poland. The scheme allows mortgage holders to defer up to eight repayments in 2022 and 2023, and there are plans to extend it next year.
“The impact depends on the level of interest rates that will be applied during the implementation of this law (…) and we do not provide estimates, because from our point of view there are still unclear elements regarding the eligibility criteria that come to these credits and holidays,” Beccio said.
He said that the cost of risks borne by the bank will rise.
“We expect risk costs to be higher in the coming quarters, at a more (normal) level, which for us means closer to 50 basis points. It won’t happen immediately, in the fourth quarter, but we will be there.” “The level should come next year,” the CFO said.
Millennium Bank, majority owned by Portugal’s Millennium BCP, said it would not propose a dividend until 2023.
“(…) The bank will be keen to continue strengthening the capital structure and not jump to the stage of distributing profits too quickly,” Brass said.
Millennium Bank made a net profit of 103 million zlotys ($24.40 million) in the third quarter, erasing a loss of 1 billion zlotys a year earlier.
($1 = 4.2214 zloty)
