This report analyses the performance of Pekao SA for the 2Q2019. You will find all the necessary details regarding volume growth, market share, margin and asset quality development in the Bank.
The key highlights are:
Revenues increased 7.18% yoy to PLN 2,067 mil in the second quarter of 2019. Interest income formed 65.7% of total revenues with the net interest margin increasing 0.06 pp to 2.76% of total assets. Fees added a further 30.6% to total revenue generated in 2Q2019, down from an average of 31.4% as seen in the previous two years.
Operating costs grew by 5.43% yoy to PLN 951 mil, so cost to income ratio reached 46.0%, up by 1.56% compared to the previous two years. Staff accounted for 61.7% of total operating expenditures. At the end of second quarter of 2019, Pekao SA operated a network of 812 branches and 16,613 employees.
Loans and deposits grew by 1.58% and 0.851% qoq respectively, so loan to deposit ratio reached 86.0% at the end of 2Q2019. That’s up from 82.4% the previous year. Equity reached 11.2% of assets and capital adequacy ratio amounted to 17.3% at the end of the second quarter of 2019.
NPLs were 5.09% of total loans at the end of the quarter. Provisions covered 91.4% of non-performing loans
Pekao SA stock traded at PLN 112 per share at the end of second quarter of 2019 implying a market capitalization of USD 7,867 mil. This put stock at a 12-month trailing price to earnings of 13.5x and price to book value of 1.33x as of the end of 2Q2019.