GDANSK, April 30 (Reuters) – Poland’s second-biggest lender Bank Pekao (PEO.WA), opens new tab reported a nearly 27% drop in its first-quarter profit on Thursday due to higher taxes, costs and provisions, but beat market expectations aided by strong new loans.
The lender said sales of mortgage loans jumped 14% from a year ago to 2.8 billion zlotys ($766 million), with a 36% increase in sales recorded in March alone.
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“The growth in our loan portfolio has enabled us to bolster our net interest income, despite lower interest rates. We are doing everything we can to be the bank of first choice and to strengthen our competitive position,” CEO Cezary Stypulkowski said in the statement.
Pekao posted a net profit of 1.23 billion zlotys for the first quarter, beating the 1.16 billion zloty estimate from analysts polled by the bank.
It said the increase in contributions to the Bank Guarantee Fund reduced the net profit by 110 million zlotys compared to last year.
Quarterly net interest income fell 3% from last year to 3.31 billion zlotys. Net fee and commission income was up 13.3% at 829 million zlotys.
Net interest margin was 3.92% in the quarter, compared to 4.07% in the last three months of 2025.
Pekao also said it was closely monitoring the risks arising from the conflict in the Middle East.
“Exposure to entities from countries in this region and from sectors particularly vulnerable to the risk of a supply shock in raw materials is limited and accounts for 0.14% and 5.48% respectively of the group’s total balance sheet exposure,” it said in a statement.
($1 = 3.6546 zlotys)
Reporting by Adrianna Ebert; editing by Milla Nissi-Prussak
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