BCP reports steady profits for Bank Millennium

Banco Comercial Português, S.A. hereby informs that Bank Millennium in Poland, in which it has a 50.1% holding and whose accounts are fully consolidated at BCP group level, released today its results for 9M 2019. Main highlights are as follows:

Profitability including Euro Bank impact

• Net profit of reached 534 million PLN (124.3 million EUR) in the first nine months of 2019, with a net impact of extra costs and provisions related to the Euro Bank acquisition of 124 million PLN (28.9 million EUR)

• Net profit of 200 million PLN (46.6 million EUR) in Q3, representing a q/q growth of 15%, adjusted for one-offs* of 224 million PLN (52.1 million EUR)

• Reported ROE at 9.2% and Cost/Income at 49%

• Adjusted* ROE of 10% and Cost/income ratio of 46%

Increased operating income. Costs influenced by Euro Bank integration

• Operating income grew 25% y/y, of which 12.3% are related to Bank Millennium organic growth

• Net interest income grew 30% y/y (13%, excluding Euro Bank)

• Operating costs grew 30% y/y, (24%, excluding integration costs)

• Bank Millennium organic costs grew 8.5% y/y (excluding integration costs)

• Initial reserve for cash loans fees returns after European Court of Justice (ECJ) ruling: 53 million PLN (12.3 million EUR)

High asset quality and liquidity

• Impaired loans (stage 3) ratio at 4.4%

• Adjusted cost of Risk** at 61 b.p. (annualised)

• Loans to deposits ratio at 86%

Capital ratios strengthened after the incorporation of 1H profits in own funds

Group’s Total Capital Ratio (TCR) at 20.2%, and CET1 ratio at 17.1% after incorporating full 1H 2019 year profits
Fitch agency affirmed Bank Millennium’s ratings at BBB-, with stable outlook

Retail business (excluding Euro Bank)

2.0 million active clients, +421 thousand clients during the last 2 years (ahead of the strategic plan objective of 600 thousand clients in 3 years)
2nd best*** nominal growth rate of retail clients: +297 thousand clients during the last year
Over 3 billion PLN (0.7 billion EUR) in new cash loans and mortgages sold, in the first nine months (+30% and 24% y/y, respectively)
Deposits grew 17.8% y/y (5.1% q/q)
Rebound in investment products (+0.1% q/q)

Retail business (including Euro Bank)

Deposits grew 37.1% y/y (5.1% q/q)
Over 1.5 billion PLN (0.3 billion EUR) of combined sales of cash loans in Q3

Companies business

Continued growth of loans to companies: +11% y/y
Deposits volume grew 23% y/y
Growth in factoring and leasing sales of 8% and 3% y/y, respectively

Quality and Innovations

The Best Web Site Design in Central and Eastern Europe, according to the Global Finance
1st place in the “Client Relations” category and 2nd place in the “Innovativeness” and “Growth” categories, in the “Banking Stars 2019” competition ****
1.3 million downloads of the Millennium Goodie app.

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