PRESS RELEASE
Warsaw, 28 October 2016 r.
Stable growth of the Bank’s income; growing number of customers and
users of mobile and electronic banking
Activity of Bank Millennium Group during 3 quarters of 2016



Bank Millennium’s net profit after 3 quarters of 2016 amounted to PLN 569.8 million

Higher than market speed of retail deposits growth maintained: +16% y/y and +2% q/q

More than half million active users of mobile solutions: almost 50% growth yearly
Bank Millennium Group consolidated net profit of in 1-3Q 2016 amounted to PLN 569.8 million i.e.
15.5% higher than in the corresponding period of 2015. Such high dynamics resulted mainly from
one-off income from VISA Europe transaction of PLN 283 million, booked in 2Q 2016, which more
than offset the negative impact of new banking tax. Net profit for 3Q 2016 amounted to PLN 138.8
million. The number of active retail customers grew 37,000 to reach 1,451,000.
Commenting on the Bank’s activity Chairman of the Management Board of Bank Millennium Joao Bras
Jorge said:
After 3 quarters of 2016 we attained the very good net financial result of PLN 570 million – 15.5% higher
than in the same period of 2015. Moreover core income grew, in particular net interest income, with
moderate growth of costs and reduction of provisions – which was possible thanks to sound asset quality.
We have been consistently implementing the strategy for 2015-2017: the number of active retail
customers has been growing dynamically – as of end of September it was close to 1.5 million, with Konto
360° - the flagship product being held by more than half a million people. Also popularity of digital
solutions has been growing markedly, to wit the almost 50% increase of the number of mobile app users
and 14% growth of e-banking customers seen in the course of last 12 months. We continue to enrich our
offering and keep designing innovative solutions; recently having implemented i.e. augmented reality
technology as well as the 3D Secure solution for authenticating transactions with a fingerprint, we
developed a proprietary technology for data scanning, which we shall be releasing soon to customers
when purchasing insurance.
Financial highlights of 1-3Q 2016 results are the following:
Core Income, defined as a combination of net interest and commission income, amounted to PLN 1,573.5
million for 1-3 quarters 2016 and increased by 4% compared to the corresponding period of the previous
Iwona Jarzębska, Departament Public Relations, ul. Stanisława Żaryna 2a, 02-593 Warszawa
tel.: (22) 598 10 22, e-mail: [email protected], Twitter: @BankMillennium_
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year. This indicates growing income from key bank's business. In quarterly terms the continuation of core
income growth can be seen: by 2.3% vs. 2 quarter 2016. Net Interest Income for 1-3 quarters 2016
reached PLN 1,149.1 million and increased by 8.7% versus the corresponding period of the previous year.
Net Commission Income in 1-3 quarters 2016 amounted to PLN 424.3 million, which means a 6.9%
decrease year-on-year due to weaker capital markets related commissions as well as lower insurance
fees. Total costs in 1-3 quarters 2016 amounted to PLN 830.6 million, which means a small increase by
2.3% when compared to the corresponding period of 2015. In quarterly terms, costs for 3 rd quarter 2016
decreased by 1.1% compared to the previous quarter. Total net impairment provisions created by the
Group in 1-3 quarters 2016 amounted to PLN 159.5 million and were 18.6% lower than provisions created
in the previous year. Net Profit for the analysed period amounted to PLN 569.8 million i.e. was higher by
15.5% year-on-year.
Liquidity, asset quality and solvency
Faster growth of deposits than loans experienced during last quarters caused, that the Group’s loan-todeposit ratio improved significantly, from 89.7% level in September 2015 to 84.9% in September 2016. The
Group enjoys one of the best asset quality among Polish banks. Share of impaired loans in total loan
portfolio remains on a stable level of 4.6% - both now and in September 2015.
Capital position of the Group remains very solid. Consolidated equity increased by 11.5% yearly to the
level of PLN 6,852 million. Consequently, all the capital ratios increased strongly during last year to very
solid levels: consolidated Total Capital Ratio to 18% and Common Equity Tier 1 ratio to 17.8%.
Q3 2016 Group business activity recap
Retail Banking: growth in almost all business areas
The number of active personal customers was 1,451,000 at end of Q3 2016. In the course of the last 12
months their number increased by 107,000, which represents fulfilment of the 2015-2017 strategic plan of
new customers’ acquisition. The dynamic increase of the number of customers is first of all attributable
to the Konto 360° offering, which has been unceasingly popular ever since its launch in May 2014, also
with young generation customers. Already one in five accounts gets opened by persons aged under 26.
The number of Konto 360° accounts exceeded the 500,000 milestone in July 2016, growing to 564,000 in
the end of September.
In the third quarter the value of deposits was increased by almost PLN 700 million, reaching PLN 38,227
million, which means 16% growth over Q3 2015. The value of funds kept on current and savings accounts
was up 32% y/y; they accounted for 55% of total deposits of retail segment customers.
New cash loan sales in 1-3Q 2016 stood at PLN 1,779 million; 7.7% less in annual terms. At the same time
sales of mortgages grew significantly – by 44% in the course of 12 months (to reach PLN 691 million).
Loans to individual customers were at PLN 33,610 million, maintaining the level attained in the same
period of 2015 (PLN 33,441 million).
Iwona Jarzębska, Departament Public Relations, ul. Stanisława Żaryna 2a, 02-593 Warszawa
tel.: (22) 598 10 22, e-mail: [email protected], Twitter: @BankMillennium_
3
E-banking, new solutions in the mobile app
As of end of September 2016 the number of customers making active use of electronic banking exceeded
940,000 i.e. 14% more than in the same period of 2015. The number of users of mobile banking as of end
of September 2016 was 521,000 (which signifies 46% growth y/y). In Q3 alone this number rose by 47,000.
The third quarter of this year saw extensive work being done to optimise online sales processes, e.g. for
cash loans. In order to raise the level of security, user-adjustable limits were introduced on online card
transactions.
After making use of augmented reality technology and then after implementing 3D Secure fingerprint
authorisation of transactions, Bank Millennium proceeded to develop further innovative solutions. Soon
enough Millennium will be offering motor insurance completely online – both in the mobile app as well as
in the Millenet transactional system. The purchase process will be bespoke and innovative. Bank
Millennium will be the first bank on the market to make use of scanning the Aztec graphic code from the
vehicle’s registration certificate. The applied solutions will make the insurance purchase process intuitive
and fast.
Customer service - omnichannel
With a view to the needs of its customers as well as latest trends, Bank Millennium is successfully
applying the omnichannel approach in customer communication, comprising branches, call center, online
and mobile banking. It is worth noting the growing share of digital channels for selling the bank’s
products and services – in Q3 of this year 23% of cash loans and 40% of new and increased authorised
overdrafts were granted with use of electronic channels. Already 99% transfers are sent and 90% term
deposits are set-up online.
As of end of Q3 2016 the bank had 381 branches (394 in Q2 2016). In keeping with the strategy the bank
continues to upgrade branches, improving their functionality and raising their effectiveness. Modern
architectural layout, enhancing the advisory role of branch staff, a more appealing customer area,
introduction of modern information media are the key strengths of the new branches. New service
centres were opened in shopping malls frequented by customers (C.H. Manufaktura in Łódź, C.H. Matarnia
in Gdańsk). In upcoming months the bank is planning to open innovative branches in Katowice, Warsaw
and other Polish cities.
Corporate Banking: good financial and sales
Q3 2016 in corporate banking resulted both in good financial performance as well as development of
customer relationships based on transactional banking and FX.
As of end of September 2016 loans to companies including leasing totalled PLN 14,174 million gross,
maintaining the level from the same period of last year. The value of leased assets in the first three
quarters of 2016 stood at PLN 2.35 billion, which means 18% growth over September 2015 and 28% growth
in terms of the number of signed agreements. The leasing portfolio grew PLN 629 million (14.4%) y/y to
reach PLN 5 billion.
Iwona Jarzębska, Departament Public Relations, ul. Stanisława Żaryna 2a, 02-593 Warszawa
tel.: (22) 598 10 22, e-mail: [email protected], Twitter: @BankMillennium_
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Factoring turnover after 3 quarters of 2016 reached the record-high level PLN of 10,886 million, i.e. more
than 13% higher than in the same period of last year while the balance of advances paid was PLN 1,815
billion. Bank Millennium thus remains 4
th
among Polish factoring companies with a close to 10% market
share.
In the corporate segment also the number of local transactions increased (13% y/y/) as well as the value
of FX transactions (33%), reaching PLN 19.8 billion till the end of September 2016. Corporate deposits
stood at PLN 16,071 million, which means their 12% decrease in annual terms. This results from
adjustment to liquidity needs and pursuing a specific pricing policy. At the same time balances on current
accounts were seen to grow.
Customers of Bank Millennium are taking an active part in obtaining EU funding. In Q3 2016 among EUsupported loans the most popular was the “loan for technological innovations”, which enables businesses
to finance innovative projects with a loan. The loan will be partly repaid with a non-repayable subsidy in
the form of a technology bonus from BGK. In the second round of subsidy applications between July and
October 2016 Bank Millennium was issuing to customers decisions in principle regarding the loan for
technological innovations. Results of the 2
nd
round are expected in January 2017.
In the first round of applications, the results of which were announced towards the end of June 2016,
more than half of the companies applying for the loan for technological innovations in Bank Millennium,
were awarded subsidies from BGK.
E-banking for companies
In Q3 2016 Bank Millennium introduced another improvement for its customers – the “Documents via
Millenet” module, which aims to improve the relationship between the bank and corporate customers.
The ability to send documents in electronic form to the bank is crucial for efficiency of the credit
process, cutting down significantly on the time-to-disbursement, while using an electronic banking system
allows offering a security level and ease of service on a par with top market standards. Since the launch
of the service on 1
st
July 2016, almost half of the corporate customers using financing had activated
access to the new function, with one out of three actively using the opportunity to send documents via
Millenet.
Quality confirmed by Newsweek’s ranking list
Bank Millennium has been the only one to be recognised in all categories of “Newsweek’s Friendly Bank
2016” ranking list – coming second in Mortgage Banking and Internet Banking, and third in Traditional and
Mobile Banking.
As in previous years, the banks were evaluated by auditors from a survey company, who as mystery
shoppers were during three months testing and evaluating quality of service and the offering of banks in
Poland.
Iwona Jarzębska, Departament Public Relations, ul. Stanisława Żaryna 2a, 02-593 Warszawa
tel.: (22) 598 10 22, e-mail: [email protected], Twitter: @BankMillennium_
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Synthetic Profit & Loss Account (PLN million)
1-3Q 2016
1-3Q 2015
Change
2016/2015
Net Interest Income
1 149.1
1 056.9
8.7%
Net Commission Income
424.3
455.7
-6.9%
Core Income
1 573.5
1 512.7
4.0%
Other Non-Interest Income
317.5
117.2
170.8%
Total Operating Income
1 890.9
1 629.9
16.0%
Personnel Costs
(417.2)
(411.1)
1.5%
Other Administrative Costs
(413.4)
(400.6)
3.2%
Total Operating Costs
(830.6)
(811.7)
2.3%
Impairment provisions
(159.5)
(196.0)
-18.6%
Special banking tax
(127.9)
0.0
-
Pre-income tax Profit
772.8
620.8
24.5%
Income tax
(203.1)
(127.4)
59.5%
Net Profit
569.8
493.5
15.5%
The full report will be available here:
https://www.bankmillennium.pl/en_US/about-the-bank/investor-relations/financial-reports/quarterlyreports
Iwona Jarzębska, Departament Public Relations, ul. Stanisława Żaryna 2a, 02-593 Warszawa
tel.: (22) 598 10 22, e-mail: [email protected], Twitter: @BankMillennium_