mBank SA ((PL:MBK)) has held its Q3 earnings call. Read on for the main highlights of the call.
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The recent earnings call of mBank SA painted a largely positive picture, with the company showcasing strong revenue and profit growth, alongside significant technological advancements. Despite some concerns about declining interest margins, increased operating costs, and a high effective tax rate, the overall sentiment was optimistic, with positive aspects significantly outweighing the challenges.
Strong Revenue and Profit Growth
The earnings call highlighted mBank’s robust financial performance, with revenues exceeding PLN 9.4 billion, marking a 5% increase year-on-year. The net profit reached PLN 2.5 billion, translating into a return on tangible equity of 20%, underscoring the bank’s strong profitability.
Loan Portfolio Expansion
A key highlight was the expansion of mBank’s loan portfolio, with core gross loans growing by 11% year-on-year. Mortgage loan sales were particularly impressive, reaching a record PLN 4.6 billion, up 24% quarter-on-quarter and 37% year-on-year.
Capital Strengthening
The bank successfully bolstered its capital base through a PLN 400 million Tier 2 issuance and retained earnings, which significantly strengthened its financial position and supported future growth initiatives.
Market Share Growth
mBank reported increased market share across various segments, including house loans, mortgage loans, household deposits, and enterprise loans, surpassing the 10% threshold in corporate deposits.
Technological Achievements
The bank’s technological advancements were recognized by Forrester’s Technology Strategy Impact Awards ’25, and it introduced the first palm payment ring with health tracking, showcasing its commitment to innovation.
Net Profit and Return on Equity
Net profit reached PLN 837 million, up 46% year-on-year, with a return on equity (ROE) of 16.4% and a return on tangible equity (ROTE) of 18.9%, indicating strong financial health.
Risk Management Success
The bank achieved notable success in risk management, with legal risk costs related to FX mortgage loans dropping by over 50% year-on-year, and a continued decline in the number of court cases.
Interest Margin Decline
Despite the positive financial results, the net interest margin declined by 23 basis points to 3.89%, primarily due to the impact of rate cuts, which remains a concern for the bank.
Operating Cost Increase
Operating costs increased by 3.3% quarter-over-quarter, driven by higher marketing expenses, which the bank will need to manage carefully moving forward.
High Effective Tax Rate
The effective tax rate rose nearly to 40%, driven by non-deductible Swiss franc-related legal risk costs, impacting the bank’s net profit.
Forward-Looking Guidance
During the call, mBank Group presented a robust financial outlook for the third quarter of 2025, with a solid 5% year-on-year revenue increase. Despite a drop in interest rates, the bank maintained strong quarterly revenues and a net profit of PLN 2.5 billion. The bank’s strategic priorities remain on track, with a focus on reducing greenhouse gas emissions and continuing its technology transformation.
In conclusion, mBank SA’s earnings call reflected a positive outlook with strong financial performance and strategic advancements. While challenges such as declining interest margins and increased costs persist, the bank’s robust growth and innovative initiatives position it well for future success.