Bank Zachodni WBK SA, the Polish unit of Allied Irish Banks, said profit increased 9 per cent in the second quarter as rising loans and deposits boosted revenue.
Net income rose to 324.4 million zloty ($157.5 million) from 298 million zloty a year earlier, the Wroclaw-based bank said today in a statement. That beat the 258.6 million-zloty median estimate of 11 analysts surveyed.
"The earnings are very good with a fast and balanced increase of volumes, mainly deposits," said Marta Jezewska, an analyst at BRE Bank SA.
"Revenues are better than expected while costs seem to be under control and in line with estimates." Higher net interest revenue helped Zachodni offset a 6.5 per cent decline in income from fees and commissions in the quarter.
The bank and its Polish rivals are seeing a drop in fee and commission income after stock market declines led to eight straight months of lower assets under management at their fund units.
Net interest income surged by a third to 401.4 million zloty in the April-June period. Revenue increased 12 per cent in the first six months, while costs rose 18 percent on expansion of the branch network.
Deposits surged 34 per cent as loans rose 36 per cent. "The bank's revenue growth will outpace cost increases," chief executive officer Mateusz Morawiecki said in an interview in Warsaw today.
Mr Morawiecki forecasts that Zachodni will spend 50 million zloty ($24.3 million) to open about 50 branches through the end of the year, after opening 45 so far. The bank plans to open another 100 branches next year and sees its market share doubling by 2012, Mr Morawiecki said.
Zachodni currently has 451 branches.
Bloomberg