Adverse EU ruling on FX loans won’t jeopardize Bank Millennium recovery plan – CEO By Reuters

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Adverse EU ruling on FX loans won't jeopardize Bank Millennium recovery plan - CEO © Reuters. FILE PHOTO: A logo of Millennium bank, Polish unit of Portugal’s Millennium BCP, is pictured on the bank headquarters in Warsaw, Poland April 28, 2016. REUTERS/Kacper Pempel

WARSAW (Reuters) – Bank Millennium’s recovery plan will not be jeopardized even if there is an unfavorable ruling on Swiss franc mortgages by European Union’s top court, the lender’s Chief Executive Joao Bras Jorge said on Tuesday.

Hundreds of thousands of Poles, who borrowed in Swiss francs due to its lower interest rates, are now paying far bigger installments than expected as the currency soared against the zloty and also due to interest rate hikes in Switzerland.

Many mortgage holders took banks to court, while banks started offering settlements to find an out-of-court solution.

EU’s top court will rule on whether the banks could charge Swiss franc mortgage holders for the use of capital if contracts were found to be at fault.

“… in our view we are going through the recovery plan. We will do the normal process that we have planned…and this decision will not put in danger the situation,” Joao Bras Jorge said.

Bank Millennium, a unit of Portuguese banking group Millennium bcp, posted a net loss of 1.01 billion zlotys ($232.19 million) in 2022, driven by provisions for risks related to FX mortgages and payment holidays.

“(A negative ruling for the sector) would imply a one-off increase in the amount of provisions, but this would not… destroy our plans for the 2023,” the bank’s finance chief Fernando Bicho said.

He also said in 2023 cost of risk may increase to 60-70 basis points compared to 44 points in 2022.

($1 = 4.3498 zlotys)

Adverse EU ruling on FX loans won’t jeopardize Bank Millennium recovery plan – CEO  

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