Mié, May 15th 2024
Commerzbank posts a decade-high quarterly result with a significant profit jump, despite ongoing challenges in Poland.
Commerzbank has kicked off the year with ant increase in profits, reporting its highest quarterly result in over a decade. The Frankfurt-based, DAX-listed bank disclosed a pre-tax profit of just under €1.1 billion for the first quarter, a 25% increase compared to the same period last year.
Net profits also saw a notable rise, reaching €747 million, up by 29% from the previous year.
Despite these positive developments, Commerzbank’s Polish subsidiary, mBank, continued to face challenges, setting aside an additional €318 million for legal risks associated with foreign currency loans. The primary issue stems from Swiss franc loans taken by many Poles for construction financing, which became problematic as the Polish zloty depreciated against the franc, leading to increased borrower litigation over unlawful clauses.
Over the past two years, Commerzbank’s consolidated results were significantly impacted by more than one billion euros in charges related to these issues in Poland. Nonetheless, the bank reported a record profit of €2.2 billion in 2023, buoyed by the shift in interest rates. Looking ahead, the bank’s performance is anticipated to depend heavily on the developments surrounding mBank’s Swiss franc loan charges.
©Keystone/SDA
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