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Handlowy warns of tough year for Polish banks after quarterly profit rises
February 12, 2015 / 7:31 AM / 3 years ago

Handlowy warns of tough year for Polish banks after quarterly profit rises

WARSAW, Feb 12 (Reuters) - Poland’s Bank Handlowy said its net profit rose by 35 percent in the last quarter of 2014 but warned of a tough year ahead for the industry due to low interest rates and a squeeze on credit card fees.

The unit of Citigroup said net profit rose in the fourth quarter to 205 million zlotys ($55 million) as it increased fees and net interest income. But full-year net profit fell by almost 3 percent to 947 million zlotys, according to the bank’s preliminary results.

The full-year results were in line with analysts’ expectations.

The Polish central bank cut interest rates by 50 basis points to 2 percent in October and has signalled another 25 basis points cut in March. Polish authorities have also cut the fee that banks charge credit card users for transactions.

“This year will be a test for the banking sector ... it will be difficult for banks to earn money,” said Slawomir Sikora, chief executive of Handlowy, Poland’s ninth-biggest bank.

“It will be difficult to talk about results rises at similar levels as before, and many banks will be forced to rebuild their business model,” he added.

$1 = 3.7117 zlotys Reporting by Marcin Goclowski; Editing by Pravin Char

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