Letter of the President of the Management Board of mBank S.A. to the Shareholders
Dear Shareholders,
The
year
2025
was
the
best
in
the
history
of
mBank
Group
across
many
dimensions
of
our
activities.
It brought
record
financial
results,
remarkable
business
achievements,
significant
corporate
events,
and
substantial
progress
in
securing
a
solid
foundation
for
the
implementation
of
the
new
strategy.
We
were
executing
our
objectives
in
a
challenging
operating
environment,
amid
strong
market
competition,
evolving
regulations,
and
geopolitical
turbulences.
Macroeconomic
conditions
in
Poland,
characterised
by
relatively
high
GDP
growth,
accelerating
investments
and
a
low
unemployment
rate,
were
generally
supportive
for
the
banking
sector.
As
inflation
subsided,
the
monetary
policy
easing
became
a
relevant
source
of
pressure
on
the
net
interest
margin
and
revenues
of
local
lenders.
After
keeping
the
reference
rate
unchanged
at
5.75%
throughout
2024,
the
Monetary
Policy
Council
decided
to
reduce
it
by
a
total
of
175
basis
points
between
May
and
December
2025
to
the
level
of
4.00%,
which
intensified
the
trend
of
early
repayments
of
mortgage
contracts.
With
the
gradually
fading
legal
risk
related
to
the
CHF
portfolio,
new
attempts
emerged
to
sue
financial
institutions
on
other
grounds,
such
as
the
so
‑
called
“free
loan
sanction”
or
questioning
the
WIBOR
benchmark.
However,
court
rulings
in
these
matters
have
so
far
been
favourable
for banks, with only a small fraction of cases won by clients.
The
excellent
financial
results
we
achieved
in
2025
confirm
the
strength
of
mBank’s
core
business
and
the
effectiveness
of
our
business
model,
which
were
crucial
in
navigating
the
years
of
the
Swiss
‑
franc
saga.
We
generated
the
highest
consolidated
net
profit
amounting
to
PLN
3.5
billion,
better
by
58%
compared
to
PLN
2.2
billion
posted
in
2024.
The
return
on
tangible
equity
(ROTE)
reached
20.8%,
rising
from
17.0%
in
the
previous
year.
At
the
same
time,
we
exceeded
the
threshold
of
PLN
5
billion
in
profit
before
income
tax.
We
delivered
record
total
income
of
PLN
12.5
billion.
Its
main
component
was
the
best-ever
net
interest
income
of
PLN
10.0
billion.
On
an
adjusted
basis,
excluding
the
impact
of
“credit
holidays”
in
2024,
it
increased
by
3.0%
year-on-year.
This
nominal
improvement
was
driven
by
the
expansion
of
business
volumes,
coupled
with
active
shaping
of
the
product
and
maturity
structure
of
the
balance
sheet,
as
well
as
an
effective
investment
and
hedging
strategy,
which
helped
offset
the
pressure
stemming
from
the
interest
rate
cut
cycle
in
Poland.
Nevertheless,
the
net
interest
margin
declined
by
0.3
percentage
points
year-on-year
to
4.05%.
Net
fee
and
commission
income
was
also
the
strongest
and
surpassed
PLN
2.2
billion.
On a comparable
basis,
excluding
an
upfront
income
from
new
contracts
prolonging
cooperation
in
the
bancassurance
area
signed
with
UNIQA
and
a settlement
with
payment
card
organisation,
it
increased
by 7.7% year-on-year, which is a dynamics clearly above the sector average.
We
maintained
leading
operational
efficiency,
anchored
in
disciplined
management
of
spending
within
the
approved
budgets.
This
was
evidenced
by
one
of
the
best
cost/income
ratios
in
the
industry,
at
31.0%.
After
two
years
of
no
payments
to
the
Deposit
Guarantee
Scheme,
the
Bank
Guarantee
Fund
reinstated
the
charges,
increasing
simultaneously
the
amount
collected
to
the
Resolution
Fund.
Consequently,
combined
contribution
from
mBank
Group
nearly
doubled
to
PLN
286
million.
Along
with
higher
personnel
expenses,
driven
by
salary
increases
and
development
of
headcount,
material
costs
mainly
in
IT,
marketing
and
security
areas
as
well
as
an
uptick
of
amortisation,
total
costs
rose
by
14.2%
compared
to
2024, reaching PLN 3.9 billion.
In
2025,
we
continued
to
pursue
prudent
risk
management.
The
high
quality
of
our
assets
was
confirmed
by
NPL
ratio,
visibly
below
the
average
for
the
Polish
banking
sector.
At
the
end
of
2025,
it
stood
at
3.5%,
supported
by
regular
sales
of
non
‑
performing
receivables.
The
cost
of
risk
reached
58
basis
points,
reflecting
the
good
and
stable
financial
standing
of
our
clients.
The
year
‑
on
‑
year
change
in
the
nominal
level
of
potential
impairment
losses
resulted
from
the
expansion
of
the
loan
portfolio,
inclusion
of
environmental
risks
into
credit
assessment
and
the
creation
of
provisions
for
several
larger
corporate exposures.
One
of
our
key
priorities
in
2025
continuously
remained
an
effective
management
of
the
foreign
currency
mortgage
issue,
with
the
aim
of
limiting
the
risks
and
losses
it
generates
for
the
bank.
We
kept
strong
momentum
in
concluding
settlements.
During
the
year,
we
signed
nearly
ten
thousand
agreements,
including
with
clients
in
disputes.
In
total,
since
the
launch
of
the
programme
in
September
2022,
we
have
reached
more
than
32.4
thousand
agreements
with
Swiss
franc
borrowers.
In
parallel,
for
many
consecutive
quarters
we
have
observed
a
steady
decline
in
the
inflow
of
new
lawsuits.
The
number