Slide 1: Results of mBank Group Q2 2024
Results of mBank Group Q2 2024 Another strong quarter. Good net result and continued business growth. Presentation for Investors and Analysts, 01.08.2024
Slide 2: Key highlights and business development in Q2 2024
Key highlights and business development in Q2 2024 Overview of the financial performance after Q2 2024 Update on Poland’s macroeconomic situation and outlook 2
Slide 3: Key highlights of Q2 2024 in mBank Group
Key highlights of Q2 2024 in mBank Group Focus on strengthening the capital position in order to pave the path for growth ▪ Decision on absence of dividend for 2024 and retaining the entire net profit earned by the Bank ▪ Substantial capital buffers and MREL ratios comfortably above the minimum requ
Slide 4: Summary of key financial metrics for mBank Group
Summary of key financial metrics for mBank Group Total income Cost/Income ratio 1 Net profit of Core Business 2 ROE of Core Business 2 PLN M excluding impact PLN M excluding impact excluding impact of "credit holidays" of "credit holidays" of "credit holidays" -1.5pp +18% +32% +6.5pp 28.5% 27.0% 6,0
Slide 5: Client base and market position of retail and corporate banking
Client base and market position of retail and corporate banking Number of retail clients (thou.) Market shares - Households mBank only, without Kompakt Finanse closing of current deposits 9.2% term deposits 6.2% dormant +202 -37 accounts 9.1% in H1/24 8.7% 8.8% 8.7% 8.7% 5,514 5,642 5,716 5,679 8.4%
Slide 6: mBank remains a front-runner in mobile banking adoption
mBank remains a front-runner in mobile banking adoption Number of active users of mBank’s mobile application 1 Number of unique users of mBank’s PFM functionalities thousand thousand, in Poland +84 by the share +686 +113 2,960 3,338 419 3,646 478 3,730 488 #1 of mobile users in total retail +228 1,4
Slide 7: Summary of financial results: Profit and Loss Account
Summary of financial results: Profit and Loss Account PLN million Q2 2023 Q1 2024 Q2 2024 ∆ QoQ ∆ YoY Net interest income 2,200.6 2,340.1 2,164.7 1 -7.5% -1.6% Net fee and commission income 487.6 484.1 491.2 +1.5% +0.7% Total income 2,695.4 2,922.1 2,890.4 -1.1% +7.2% Total costs (excl. compulsory c
Slide 8: Summary of financial results: Balance Sheet
Summary of financial results: Balance Sheet PLN million Q2 2023 Q1 2024 Q2 2024 ∆ QoQ ∆ YoY Total assets 212,928 224,157 230,296 +2.7% +8.2% Gross loans to customers 121,727 120,001 124,960 +4.1% +2.7% Individual client loans 68,155 66,634 67,417 +1.2% -1.1% Corporate client loans 1 49,758 51,715 52
Slide 9: Safe capital position with significant surplus over regulatory minima
Safe capital position with significant surplus over regulatory minima Development of mBank Group’s capital ratios Development of mBank Group’s MREL ratios +4.35 MREL requirement CBR calculated on TREA (w/o mBH) as of 06/24 16.81% 16.89% 17.04% 16.22% MREL (TREA) MREL (TREA) Subordinated 2.33% 15.46%
Slide 10: Protection against legal risks of CHF portfolio further strengthened
Protection against legal risks of CHF portfolio further strengthened Value of CHF mortgage loans to natural persons (PLN M, net) Decomposition of CHF loan contracts at mBank, as of 30.06.2024 23.6% 22.1% portfolio deductions due to legal risks -72.6% 17.1% 14.7% % of total loan portfolio 85,520 12.2
Slide 11: Progress with settlements, declining number of new court cases
Progress with settlements, declining number of new court cases Number of settlements concluded by mBank (cumulative) Number of CHF loan contracts in court (pending cases) repaid contracts All active loan holders received 17,016 21,411 21,772 21,621 settlement proposals (~100%). 15,166 active contrac
Slide 12: Excellent performance of the core business continued in H1/24
Excellent performance of the core business continued in H1/24 Summary of financial results for mBank’s core activity and run-off portfolio in H1/24 Separation of FX mortgage loan portfolio PLN million Core Business Non-core1 mBank Group ▪ In order to present the genuine and undistorted performance o
Slide 13: Key highlights and business development in Q2 2024
Key highlights and business development in Q2 2024 Overview of the financial performance after Q2 2024 Update on Poland’s macroeconomic situation and outlook 13
Slide 14: Results of mBank Group: Loans to customers
Results of mBank Group: Loans to customers Reviving growth of loan portfolio visible in both corporate and retail business segments Development of gross loans and advances to customers Gross loans to corporate customers PLN M PLN M +7.4% +2.7% +8.5% +7.9% +3.7% +4.1% +7.8% +4.0% 53,429 53,453 50,836
Slide 15: Results of mBank Group: New lending business
Results of mBank Group: New lending business High sales of mortgage loans maintained and uptrend in consumer credit Sales of mortgage loans Sales of non-mortgage loans PLN M, by quarter PLN M, by quarter 2% Safe +95% -4% -4% Mortgage +41% +4% +4% Q3/23: PLN 10 M 2,352 2,268 2,856 Q4/23: 2,750 57 31
Slide 16: Results of mBank Group: Customer deposits
Results of mBank Group: Customer deposits Deposit base fuelled by inflows to current accounts amid focus on pricing optimisation Development of customer deposits Deposits from corporate customers PLN M PLN M +5.6% +6.2% +4.1% +0.3% +2.4% 56,439 0.0% 50,215 54,201 52,861 53,020 185,109 185,467 183,06
Slide 17: Results of mBank Group: Total income
Results of mBank Group: Total income Record net interest income disturbed by “credit holidays”, improvement of net fees Development of mBank Group’s total income Development of interest income PLN M PLN M other operating income in Q2/24 +7.2% included a refund of collection -9% lowered by “credit -1
Slide 18: Results of mBank Group: Total costs and efficiency
Results of mBank Group: Total costs and efficiency Excellent efficiency continued, higher costs reflect investments and growing operations Development of mBank Group’s operating costs Cost/Income ratio of mBank Group – quarterly PLN M excluding impact of “credit holidays” and a refund by KUKE (in Q2
Slide 19: Results of mBank Group: Loan loss provisions and cost of risk
Results of mBank Group: Loan loss provisions and cost of risk Provisioning edged up from non-recurrent level, still remains below the annual guidance Net impairment losses and fair value change on loans mBank Group’s cost of risk, by segment PLN M bps 165 -11% 87 Negative one-off impact in Q4/23 of:
Slide 20: Results of mBank Group: Loan portfolio quality
Results of mBank Group: Loan portfolio quality Good asset quality, NPL ratio influenced by defaults on single large corporate exposures mBank Group’s impaired loans portfolio mBank Group’s NPL ratio PLN M NPL ratio +7.7% 4.3% according to EBA 4.2% 4.2% 4.1% definition has +7.6% 4.1% remained conside
Slide 21: Key highlights and business development in Q2 2024
Key highlights and business development in Q2 2024 Overview of the financial performance after Q2 2024 Update on Poland’s macroeconomic situation and outlook 21
Slide 22: Macroeconomic situation and outlook
Macroeconomic situation and outlook NBP unlikely to cut rates in 2024 as inflation and consumption are set to rebound. Consumption on the rise again Unemployment rate (still) very low 20 12% 10 10% 0 8% -10 6% -20 4% -30 -40 2% Source: GUS Source: GUS -50 0% Jan.16 Oct.16 Jul.17 Apr.18 Jan.19 Oct.19
Slide 23: Macroeconomic situation and outlook
Macroeconomic situation and outlook Credit growth is rebounding. Bond yields decreased somewhat and PLN held its strength. Corporate loans and deposits (YoY, FX-adjusted) Household loans and deposits (YoY, FX-adjusted) 30% 14% Source: NBP 12% Source: NBP 25% 10% 20% 8% 15% 6% 10% 4% 5% 2% 0% 0% -2%
Slide 24: Poland: economic fundamentals
Poland: economic fundamentals Growth story. High competitiveness compared to peers. Real GDP (Q1 2010 = 100) Hourly labour costs (in EUR) 170 50 Source: Eurostat Source: Eurostat 160 40 150 140 30 130 120 20 110 10 100 90 0 Jan.10 Jul.11 Jan.13 Jul.14 Jan.16 Jul.17 Jan.19 Jul.20 Jan.22 Jul.23 Bulgar
Slide 25: Macroeconomic forecasts and outlook for mBank Group
Macroeconomic forecasts and outlook for mBank Group Operating environment for banks has continued being challenging and volatile Key economic indicators for Poland Prospects for mBank in 2024 (compared to 2023) 2022 2023 2024F 2025F Net interest income & NIM slightly positive GDP growth (YoY) 5.6% 0
Slide 26: Appendix
Appendix 26
Slide 27: Selected Financial Data
Selected Financial Data Consolidated Profit and Loss Account – quarterly Quarterly results (PLN thou.) Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Net interest income 2,200,635 2,284,687 2,355,039 2,340,082 2,164,656 Net fee and commission income 487,641 482,704 444,500 484,127 491,227 Dividend income 4
Slide 28: Selected Financial Data
Selected Financial Data Consolidated Statement of Financial Position – quarterly Assets (PLN thou.) Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Cash and balances with Central Bank 16,381,485 19,451,659 36,702,427 24,535,807 21,707,034 Loans and advances to banks 11,508,432 17,095,049 7,119,059 12,054,84
Slide 29: Selected Financial Data
Selected Financial Data mBank Group’s Ratios – quarterly and cumulatively Financial Ratios Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Net Interest Margin, quarterly 4.33% 4.26% 4.31% 4.37% 4.44% Net Interest Margin, YtD 4.08% 4.14% 4.18% 4.37% 4.41% Net Interest Margin, excl. CHF portfolio, YtD 4.22% 4
Slide 30: Selected Financial Data – Net interest income
Selected Financial Data – Net interest income Structure of mBank Group’s interest income Structure of mBank Group’s interest expense PLN M Presented development and dynamics are PLN M adjusted for the impact of “credit holidays” -1.8% +1.2% -18.9% 3,836.9 1,552.2 3,667.8 3,678.1 265.4 3,561.2 3,603.
Slide 31: Selected Financial Data – Net fees and commissions
Selected Financial Data – Net fees and commissions Structure of mBank Group’s fee and commission income Structure of mBank Group’s fee and commission expense PLN M PLN M +5.4% +2.6% +14.0% 769.5 788.1 +4.5% 760.6 768.2 325.0 748.0 83.4 11% 67.4 68.4 85.7 83.5 296.9 277.9 284.0 123.5 120.0 121.3 15%
Slide 32: Selected Financial Data – Balance sheet analysis
Selected Financial Data – Balance sheet analysis Structure of mBank Group’s total assets Structure of mBank Group’s liabilities and equity PLN B PLN B 227.0 230.3 227.0 230.3 225.4 224.2 225.4 224.2 212.9 212.9 13.7 13.7 14.6 6% 29.2 13% 14.1 26.6 31.6 10.6 11.8 5% 44.0 13.5 8.4 10.4 23.6 2.7 2.7 2.
Slide 33: Selected Financial Data – Structure of loans and deposits
Selected Financial Data – Structure of loans and deposits Structure of mBank Group’s gross loans, by client segment and industry Structure of mBank Group’s deposits as of 30.06.2024 as of 30.06.2024 Real estate 5.3% Financial activities 4.6% Building industry 4.5% 0.1% 0.5% Food sector 2.7% 17.6% 13
Slide 34: Selected Financial Data – Funding profile
Selected Financial Data – Funding profile Structure of mBank Group’s funding Summary of mBank’s long-term funding instruments as of 30.06.2024 as of 30.06.2024 Nominal Issue Maturity Currency Tenor Coupon value date date Other Subordinated liabilities 5.5% Issues under Euro Medium Term Note (EMTN) P
Slide 35: Selected Financial Data – Capital requirements and liquidity
Selected Financial Data – Capital requirements and liquidity Regulatory capital requirements for mBank Group as of 30.06.2024 Countercyclical Capital Buffer (CCyB), calculated as the weighted average of the CCyB +4.35 pp rates that apply in the countries where the relevant credit exposures are locat
Slide 36: Selected Financial Data – MREL requirements
Selected Financial Data – MREL requirements Fulfilment of MREL requirements by mBank Group MREL (TREA) MREL (TREA) Subordinated +4.27pp +5.09pp ▪ On 09.04.2024, mBank received the joint decision of Bank Guarantee Fund and Single Resolution Board 23.63% 22.79% 22.77% 21.94% regarding the minimum MREL
Slide 37: A leading mobile banking offer for individual clients
A leading mobile banking offer for individual clients Well-designed functionalities for client convenience Mobile application’s dashboard and basic features fully remote account opening with e-ID or a selfie and agreement approved via a text message easiest way to manage logging in and confirmation
Slide 38: Retail Banking – profit and network
Retail Banking – profit and network Profit before income tax of the segment Number of Retail Service Locations PLN M, by quarter excluding impact of "credit holidays“ -9 mBank CZSK mBank CZSK Poland +36% 360 352 351 +7% +7% 47 45 45 mFinanse1 1,173.2 40 41 41 1,100.3 mKiosks 1,002.5 52.7 862.9 828.6
Slide 39: Retail Banking – business volumes
Retail Banking – business volumes Development of gross loans to retail banking clients Development of deposits from retail banking clients PLN M PLN M 11,228 Customer funds invested via Investment funds mBank’s solutions (30.06.2024) Brokerage assets 25,174 -1.1% +1.2% +6.1% 68,155 67,829 67,417 +3.
Slide 40: mBank in the Czech Republic and Slovakia
mBank in the Czech Republic and Slovakia Gross loans and share in total mBank’s retail volume Deposits and share in total mBank’s retail volumes PLN M PLN M -8% 13.3% 0% 12.4% +2% +8% 9,696 9,816 16,700 17,004 16,631 9,129 8,813 8,946 15,954 15,379 2,976 3,104 4,636 4,705 4,406 4,377 2,915 2,902 2,9
Slide 41: mBank in the Czech Republic and Slovakia
mBank in the Czech Republic and Slovakia Mortgage loans Non-mortgage loans Customer deposits CZK M CZK M CZK M -10% +11% +12% Czech Republic -2% +9% +6% physical network: light 6 branches 25,695 23,487 23,023 10,529 11,125 64,358 66,114 72,159 financial 10,002 7 centres 17 mKiosks 06/23 03/24 06/24
Slide 42: Best digital banking services for corporate clients
Best digital banking services for corporate clients First-class digital banking offer for companies Mobile application’s dashboard and basic features ▪ activating the app with a entirely digital onboarding process, QR code with no in-person contact and printouts required ▪ logging into the applicati
Slide 43: Corporate & Investment Banking – profit and network
Corporate & Investment Banking – profit and network Profit before income tax of the segment Number of corporate service locations PLN M, by quarter as of 30.06.2024 2 2 +11% Pomorskie 1 2 2 Warmińsko- +18% Zachodnio- Mazurskie 1 1 Pomorskie 2 1 Podlaskie 29 mBank’s branches, Kujawsko- Pomorskie 4 2
Slide 44: Corporate & Investment Banking – business volumes
Corporate & Investment Banking – business volumes Development of gross loans to corporates and public sector Development of deposits from corporates and public sector PLN M PLN M +7.4% +7.8% +6.3% +0.3% 57,543 57,055 54,643 1,656 53,799 53,949 53,573 53,590 53,367 6,491 50,738 1,616 1,898 1,672 50,9
Slide 45: Performance of main subsidiaries of mBank
Performance of main subsidiaries of mBank specialised mortgage bank offered financing in the form of offered services include and active issuer of covered leasing of cars, trucks, machinery domestic and export recourse bonds on both domestic and real estate as well as car and non-recourse factoring
Slide 46: Unique value proposition for e-commerce market participants
Unique value proposition for e-commerce market participants mOkazje zakupy – development of marketplace in mBank's mobile application Expansion of Paynow in online payments superior payment processing ▪ mBank launched first of this kind capabilities: the quickest settlements cooperation with Morele.
Slide 47: Strategic financial targets of mBank Group
Strategic financial targets of mBank Group Updated strategic financial targets of mBank Group for 2023-2025 compared to results for H1/24 measure target level execution in H1/24 ✓ supported by high Efficiency [in 2025] Cost/Income ratio (C/I) below 40% 28.7% interest rates offsetting inflationary pr
Slide 48: ESG well embedded in mBank Group's strategy (1/2)
ESG well embedded in mBank Group's strategy (1/2) Environmental pillar SBTi commitment mBank joined the Science Reducing greenhouse gases (GHG) emissions of our loan portfolio, steered by SBTi as the Based Targets initiative (SBTi) in 2022. In line with most prominent driver to become net-zero our o
Slide 49: ESG well embedded in mBank Group's strategy (2/2)
ESG well embedded in mBank Group's strategy (2/2) Social pillar Governance pillar Providing an attractive work environment that ensures Enhancing our corporate governance by ESG aspects diversity, equity and inclusion ▶ ensure gender balance in the succession program ▶ have all TOP 100 managers (at
Slide 50: Historical financial results of mBank Group
Historical financial results of mBank Group PLN million 2019 2020 2021 2022 2023 ∆ YoY Net interest income 4,002.8 4,009.3 4,126.3 5,924.0 8,873.5 +49.8% Net fee and commission income 1,270.6 1,508.3 1,867.8 2,120.1 1,915.9 -9.6% Net trading and other income 251.0 349.2 117.1 -187.2 12.9 -/+ Total i
Slide 51: mBank's share price performance
mBank’s share price performance Polish banking stocks surged in Q1/24 and continued outperforming the broad market mBank’s index membership and weights mBank’s share performance v. main indices (rebased to 100) as of 30.06.2024 190 mBank’s share price WIG20 2.563% 180 30.06.2023 406.1 WIG30 2.443% +
Slide 52: Disclaimer
Disclaimer This presentation has been prepared by mBank S.A. for information purposes only and is based on the Condensed Consolidated Financial Statements for the first half of 2024, prepared under the International Financial Reporting Standards. For more detailed information on mBank S.A. and mBank
Slide 53: Contact details
Contact details Karol Prażmo Managing Director for Treasury and Investor Relations +48 607 424 464 karol.prazmo@mbank.pl Joanna Filipkowska Head of Investor Relations +48 510 029 766 joanna.filipkowska@mbank.pl Paweł Lipiński +48 508 468 023 pawel.lipinski@mbank.pl Marta Polańska +48 508 468 016 mar