* Millennium Q1 profit rises 2 pct y/y to 140.5 mln zlotys
* Bank beats forecasts on higher sales and lower deposit
* Millennium results pump up other lenders' result
(Adds details, analyst comment)
By Marcin Goclowski
WARSAW, April 25 Poland's Bank Millennium
beat expectations with a 2 percent rise in
first-quarter net profit, as the lender slashed deposit costs
and accelerated product sales.
Millennium's positive earnings bode well for other lenders,
which may also have improved their profitability in a super-low
interest rate and high regulatory and fiscal cost environment,
The Polish unit of Portugal's Millennium BCP said
its first-quarter net profit was 140.5 million zloty ($35.97
million), above analysts' expectations of 117 million zlotys.
Millennium's net interest income rose 13 percent
year-on-year, while fees and commissions jumped by 24 percent,
which offset the higher costs related to payments to guarantee
"It may be a sign that others will also surprise with the
result on the sale of insurance and investment products. If such
a trend materialises, expectations regarding their profits could
rise," said Marcin Gatarz, analyst with Pekao Investment
Bank Zachodni WBK, a unit of Santander
, as well as mBank the Polish arm of
Commerzbank, are due to release first-quarter profits
on Wednesday and Thursday, respectively.
Millennium shares rose 9.6 percent, with other banks likely
to be supported by its upbeat results, Gatarz said, although on
a smaller scale.
Millennium's stock has risen by around a quarter so far this
year, outperforming the broader banking sector index, on
expectations that the ruling Law and Justice (PiS) party will
abandon its plan to force banks to convert Swiss franc
denominated credit portfolios into zlotys at their expense.
($1 = 3.9055 zlotys)
(Reporting by Marcin Goclowski; Editing by Agnieszka Barteczko
and Louise Heavens)