Net interest income for 2019 amounted to PLN 10 279 million (+PLN 934 million y/y). The higher result was determined by an increase in volume, while interest margin was maintained.
Interest income* amounted to PLN 12 760 million and was PLN 1 166 million higher than in 2018, mainly due to:
- an increase in financing granted to customers of PLN 949 million y/y – related to the increase in the amounts due from loans and leases of over PLN 17 billion and an increase in average interest rate resulting from a change in their structure (an increase in the share of consumer loans and lease receivables mainly at the expense of foreign currency housing loans) with stable market interest rate levels for PLN, CHF and EUR,
- higher income on securities (+PLN 243 million y/y), mainly as a result of the increase in the average volume of Treasury bonds of PLN 12 billion.
*To ensure data comparability, interest income was adjusted as follows: income on non-Treasury bonds, which are recognized in income from debt securities in the financial statements, was transferred to income for loans and advances to customers.
In 2019, interest income dropped by PLN 178 million in connection with the judgment of the Court of Justice of the European Union in respect of consumer’s right to reduce the loan’s cost in the event of repaying the loan before the deadline specified in the loan agreement.
Interest expense amounted to PLN 2 481 million and was PLN 232 million higher than in the corresponding period of 2018. This resulted mainly from an increase in the costs of the deposit base of PLN 134 million y/y, connected with an increase in the average volume of deposits of PLN 24 million compared with the prior year, with higher costs of external financing of PLN 45 million and higher costs of premium on securities of PLN 58 million.
The net interest margin remained at the prior-year level and stood at 3.4% as at the end of 2019. In 2019, the average interest rate on the bank’s loans was 4.7%, and the average interest rate on total deposits was 0.7%, compared with 4.7% and 0.7% respectively in 2018.