Alior Bank: One-Off CJEU Provision Masks Solid Fee Growth and 5%+ NIM
Poland's Alior Bank delivers 14.3% adjusted ROE and a clear path to sub-5% NPLs, while a one-off legal charge clouds the headline.
ALR.WA · Earnings Call · 2026-08-04
One-Off CJEU Provision Masks a Solid Quarter
Alior Bank's H1 2026 results were overshadowed by a CJEU judgment that forced a PLN 153 million interest adjustment and a corresponding hit to fees. As CEO Piotr Zabski noted, “we've had a good quarter and a good first half, PLN 1.37 billion in revenue, which is 10% less than a comparable quarter of the previous year, but the result includes the results of CJEU. If we didn't have that one-off, it would be on the same level as the previous year, which with lower interest rates shows that our business activity brings good results.” — Piotr Zabski, Chief Executive Officer · 2026-08-04 Excluding the one-off, profit came in at PLN 433 million, still 20% below prior year due to a higher CIT rate, but ROE jumped to 14.3% (from 11.5% as reported). The bank's ability to hold revenue stable in a falling-rate environment underscores the success of its fee diversification and loan growth.Fee Engine and Margin Discipline Are the New Growth Pillars
A key theme on the call was the continued build-out of non-interest income. The brokerage house and investment funds saw 21% YoY growth in customer assets, and brokerage commissions rose sharply. Zabski explained, “when we consider brokerage activities, it obviously fluctuates depending on the interest of the customers in the activity of the stock market, for instance. But in our assessment, we are witnessing a regular business development there. We expect in the subsequent quarters in the second half of the year, the commission values which will be not lower from what we reported in the first half.” — Piotr Zabski, Chief Executive Officer · 2026-08-04 Management is explicitly targeting a high level of margin — they aim to keep NIM around 5%. CFO Zdzislaw Wojtera emphasized, “If we exclude this effect, the result would be 5.11%. So that's in check with our aspirations and expectations for our margin and the growth of business. So, we will strive to keep NIM stable at approximately 5%.” — Zdzislaw Wojtera, Chief Financial Officer · 2026-08-04 This margin discipline is supported by a shift toward Consumer loans (especially cash loans) and a selective approach to lower-margin installment products.Asset Quality Trends Point to a Sub-5% NPL
Risk management remains a core focus. cost of risk rose to 0.71% (core total) due to a large single-business default, but the bank is confident in its trajectory. Marcin Ciszewski stated, “Nonperforming loans ratio, we continue to go down below 5% of such loans, and it's realistic. And we are continuing our strategy. We want this indicator to go down below 5% by the end of this year.” — Marcin Ciszewski, Treasury or Capital Markets Executive · 2026-08-04 The NPL ratio stood at 5.16% at end-June. The bank is also actively managing the business segment, where NPLs are higher, and expects that ratio to fall into single digits. Leasing continues to be a bright spot with 30% YoY growth, and leasing activity is running at twice the market pace.Strategic Priorities and Outlook
Alior is sticking to its three-pillar strategy of growth, resilience, and operational excellence. The company's mobile app is now used by a growing share of customers, with 43% of sales initiated via mobile. The bank also paid a PLN 1.1 billion dividend and issued an S&P-rated bond at a good margin. In a more competitive credit market, Zabski remains optimistic but watchful: “We view this market positively. The low interest rate is conducive to providing more loans to customers.” — Piotr Zabski, Chief Executive Officer · 2026-08-04 The bank is balancing growth with tight cost control and a focus on high-margin segments. Prior quarters reveal that the CJEU issue is not new — management had already flagged it in April. Then, an executive noted, “Well, first of all, what we are observing is a much better situation in terms of winning the law suit. That is why the reserve level is as it is.” — Unknown Executive, Board Member / Executive · 2026-04-27 This quarter's provision is a direct consequence of that ruling. Similarly, the bank's approach to reserves had been outlined earlier, as in February when they said, “Well, in the first quarter, we did not set up a reserve fund for that. We simply decreased because of the incidents of higher success rate that Piotr mentioned.” — Unknown Executive, Board Member / Executive · 2026-04-27 The consistent narrative reinforces that Alior is proactively managing legal risks while delivering on its strategic targets.Alior's H1 2026 is a tale of disciplined execution in a challenging environment. The one-off CJEU hit is a known, quantified item; the underlying business continues to perform well with strong fee income, a resilient NIM, and improving asset quality. The bank's focus on high-margin retail products and leasing, combined with a proactive approach to risk, positions it well for the remainder of the year."We want this indicator to go down below 5% by the end of this year." — Marcin Ciszewski