In the first half of 2024, the bank’s revenues amounted to PLN 2.94 billion (9% more year-on-year), and net profit – PLN 1.164 billion. – Net profit for the first half of 2024, which was as much as 34% higher than in the same period of 2023, proves the stable and strong condition of Alior Bank. We have strengthened our capital position, achieving indicators significantly exceeding regulatory minimums – Artur Chołody, a member of the Supervisory Board of Alior Bank delegated to perform the duties of the Vice-President of the Management Board of the Bank, managing the work of the Management Board of the Bank, told us after Thursday’s results conference.
The day before, on August 1, the Supervisory Board of Alior Bank appointed five new members of the management board. Piotr Żabski, previously associated with Santander Consumer Bank, among others, became the president (he is to assume the function from the beginning of 2025), and vice-presidents were also managers with extensive experience in the financial sector: Jacek Iljin (he will manage the work of the Alior management board until Piotr Żabski obtains the consent of the Polish Financial Supervision Authority), Wojciech Przybył, Marcin Ciszewski and Zdzisław Wojtera. The new management board was selected in a competition announced by the Supervisory Board in the spring, after the dismissal of the previous authorities of the bank associated with the PiS government, or more precisely Zbigniew Ziobro’s Sovereign Poland. Contrary to the concerns of some commentators, it consists entirely of experts and does not include a single “friend of the rabbit”.
The new management board has appeared at a time when work is underway on the bank’s strategy for the next three years. One of the goals is to deepen cooperation with the PZU group (the insurance giant has a majority stake – 32.1% of Alior Bank shares). Alior intends to increase the synergy effect within the PZU group primarily through the development of specific product lines, seeing opportunities especially in leasing.
– Alior Leasing has recorded huge growth, around 30% last year. It is also planning 30% this year, so it is developing like a startup. We also see great potential in mortgage and cash loan insurance – says Artur Chołody.
One of Alior’s priorities remains further digitalization. – For next year, we are preparing a record-breaking investment budget in the bank’s history, especially in new technologies related to, among others, mobile applications – emphasizes Artur Chołody. The number of users of the Alior Bank mobile application at the end of the second quarter of 2024 amounted to 1.2 million and was 19 percent higher than in June 2023. The bank wants it to reach 1.5 million by the end of the year.
Key financial indicators of the Alior Bank Group in Q2 2024:
– Assets – PLN 90.1 billion (an increase of 8%)
Revenues: PLN 1,440 million
Net profit: PLN 586 million
Capital position: TIER 1 ratio – 17.12 percent, TCR – 17.53 percent; surpluses over regulatory minimums amount to: 845 bps and 686 bps, respectively.
CoR (Cost of Risk): 0.23 percent
NPL (Non-Performing Loan Ratio): 6.78 percent
NIM (net interest margin): 5.82 percent
ROE (return on equity): 23.9 percent
C/I (cost to income): 35.7 percent
– Loan to deposit ratio (L/D): 84.6% (up 2.1 pp year-on-year)
Radomir Gibała, Vice-President of the Management Board of Alior Bank responsible for finance, points out that “the interest margin adjusted for the impact of credit holidays would amount to 6.22%, which places Alior Bank among the most profitable entities.”
Tomasz Miklas, Vice President of the Management Board of Alior Bank responsible for the risk area, points to a significant reduction in risk costs: in the second quarter of 2024, they amounted to PLN 39 million, which is 74 percent less compared to the same period of the previous year. – We are currently not identifying factors that could significantly negatively affect the level of risk costs. We expect that in 2024 for the Alior Bank Group they will oscillate around 0.65 percent, and assuming no significant macroeconomic changes in the coming years, we expect them to amount to 0.8 percent – says Tomasz Miklas.
Personal accounts, loans, credits
In the first half of 2024, sales of personal accounts in Alior Bank increased by 28% year-on-year. The number of customers with systematic inflows increased to 1.126 million (by 61 thousand). In the second quarter of 2024, 1.2 million users used the Alior mobile application, 19% more than a year earlier. The number of operations performed by customers is growing equally fast (in the case of BLIK – by 33%).
In Q2 2023, sales of mortgage loans at Alior amounted to nearly PLN 0.7 billion (an increase of 14% year-on-year). The number of customers with such a loan increased by 11%. The gross portfolio value amounted to PLN 19.8 billion, 22% more than in the same period of 2023, which gave the bank a 3.8% market share. At the end of H1 2024, the share of residential real estate loans in Alior Bank’s portfolio reached 29.3% gross.
In Q2 2024, 76% of mortgage loans granted had a periodically fixed interest rate – almost twice as many as in Q2 2023. At the end of the quarter, loans with a periodically fixed interest rate accounted for 24.4% of the mortgage loan portfolio.
Sales of cash loans increased by 7% in this period compared to the first quarter, reaching almost PLN 1.7 billion. The bank increased the share of sales in remote channels to 55%. Online sales broke records, reaching PLN 129 million. The share of market sales of cash loans in Q2 2024 reached 7%. Alior Bank’s share in this sector is 10%.
5 percent in the business customer segment
In the construction sector, Alior Bank has a 10 percent market share, and in the sole proprietorship (JDG) segment – 9 percent. In the first half of 2024, the bank provided entrepreneurs with new digital tools and enabled the integration of business registration in CEIDG with opening a company account via online banking.
There is also an increase in interest in digital channels among business customers: in Q2 2024, over 80% of orders were made remotely, while online sales of bills increased by 125% year-on-year.
Alior’s new strategy will take into account ESG principles to an even greater extent. Alior was one of the first banks to enable customers to calculate their carbon footprint.
Artur Chołody, member of the Supervisory Board of Alior Bank delegated to perform the duties of vice-president of the bank’s management board, directing the work of the bank’s management board, comments for us:
Net profit for the first half of 2024, up 34% higher than in the same period of 2023, proves the stable and strong condition of Alior Bank. We have strengthened our capital position, achieving indicators significantly exceeding regulatory minimums. We are also pleased with the decrease in risk costs – in the second quarter of 2024 they were as much as 74% lower than a year earlier. This used to be a big problem for Alior Bank, recently we have worked very hard on it and we can see the effects. Other indicators also show the improvement in the bank’s condition.
We are dynamically increasing the number of users of our mobile application – at the end of the second quarter of 2024 it amounted to 1.2 million and was 19% higher than in June 2023. We want to reach 1.5 million by the end of the year.
Alior Bank’s flagship products remain cash loans and installment loans, while at the same time we worked hard on the mortgage loan market, recording double-digit sales growth in the second quarter.
In May, Alior Bank shared its profit with investors for the first time, allocating PLN 577 million, or PLN 4.42 per share, to dividends for the previous year. The signals we are receiving indicate that this was very well received by the market – primarily as evidence of the bank’s financial stability. We have moved up a league, to dividend companies, and our ambition is to constantly share our profits with shareholders, perhaps even to a greater extent than recently. The S&P rating agency has awarded our bank a BB+ rating with a positive outlook. This is primarily due to over 4.6 million customers who have trusted us, as well as employees and shareholders.
