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1. Company Snapshot

1.a. Company Description

Bank Polska Kasa Opieki S.A., a commercial bank, provides a range of banking products and services to retail and corporate clients in Poland and internationally.It operates through Retail Banking, Private Banking, Corporate and Investment Banking, Enterprise banking, and Assets and Liabilities Management and Other segments.The company accepts current accounts, saving accounts, and term deposits.


Its loan products include mortgage, operating, investment, cash, and consumer loans; loans for corporates, and small and medium enterprises; and commercial real estate financing.The company also provides insurance, asset management, pension funds, brokerage, transactional advisory, leasing, factoring, business consulting, transferable agent, call-center, real estate development, and online banking services.As of December 31, 2021, it operates 650 outlets and 1,475 ATMs. Bank Polska Kasa Opieki S.A. was incorporated in 1929 and is headquartered in Warsaw, Poland.

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1.b. Last Insights on PEO

Bank Polska Kasa Opieki S.A. faced headwinds over the past three months, primarily due to unfavorable regulatory developments. The Polish finance ministry's plan to increase the corporate income tax rate paid by lenders, announced on August 22, 2025, likely impacted the bank's prospects. This move aims to bolster the country's budget but may weigh on the bank's profitability. Additionally, the European economic landscape, characterized by tentative optimism around EU-U.S. trade agreements and steady interest rates, presented a mixed backdrop for the bank's operations.

1.c. Company Highlights

2. Pekao S.A. Delivers Strong FY 2025 Results with Accelerated Credit Growth

Pekao S.A. reported a robust financial performance for the fourth quarter and the entire 2025, with key highlights including a return on equity of PLN 7 billion, driven by the acceleration of credit actions and strengthening of commission profit. The bank's earnings per share (EPS) came in at 6.95, surpassing analyst estimates of 6.56. The bank's revenue growth was supported by a significant increase in corporate banking, with a strong rebound in the micro segment and an increase in customers with a higher profile. Dagmara Wojnar presented the financial results, highlighting an 8% growth in loans, with retail loans growing 5% and corporate loans growing 11%.

Publication Date: Feb -22

📋 Highlights
  • Return on Equity: Achieved PLN 7 billion from accelerated credit actions and commission profit growth.
  • Corporate Banking Growth: 1,013 new mid-market customers acquired, with 15% market share in large corporations via factoring.
  • Cost-to-Income Ratio: Requires investment to address past underinvestment, despite 21% year-on-year factoring turnover growth.
  • Dividend Target: Aims for 50-70% payout ratio, with flexibility to reach 75% if feasible.

Strong Credit Growth and Commission Income

The bank's credit growth was a key driver of its financial performance, with corporate loans growing 11% and retail loans growing 5%. The bank's commission income also saw a significant increase, with a year-on-year growth of almost 11%. According to Lukasz Januszewski, Vice President responsible for Corporate Banking Division, the bank's efforts to digitize the corporate banking segment, including the use of AI technologies and advisory services, have been successful in driving growth. The bank's factoring company has reclaimed its leadership in the rank with a 21% year-on-year growth and a PLN 100 billion turnover.

Valuation and Dividend Yield

With a Price-to-Tangible Book Value (P/TBV) of around 1.84, the bank's valuation appears reasonable. The Dividend Yield stands at 7.9%, indicating an attractive return for investors. The bank aims to pay a dividend in the range of 50-70% and will do everything in its power to achieve this. Cezary Stypulkowski stated that the bank's comfort level is at 50%, but they can go up to 75%. The bank's strong capital position, with a CET of 15%, provides a solid foundation for returning capital to shareholders.

Outlook and Strategy

The bank's strategy is on track, with all elements above target, and it aims to grow faster than the market, with a 2-digit growth rate. The bank will focus on simplifying processes and investing in employees to achieve this goal. Ernest Pytlarczyk provided a macro update, stating that GDP is expected to grow by 4% in 2025, with investment growth reaching 10%. The bank's strong performance and favorable macroeconomic outlook position it well for future growth.

3. NewsRoom

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Bank Polska Kasa Opieki SA (BKPKF) Full Year 2025 Earnings Call Highlights: Record Profits Amid ...

Feb -21

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European Dividend Stocks To Consider In February 2026

Feb -04

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How The Narrative Around Bank Polska Kasa Opieki (WSE:PEO) Is Shifting After The Target Cut

Jan -08

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Top European Dividend Stocks To Consider In January 2026

Jan -05

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How New Risks and Balanced Upside Are Shaping the Narrative for Bank Pekao

Dec -15

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Top 3 European Dividend Stocks To Consider

Nov -26

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Bank Polska Kasa Opieki SA (BKPKF) Q3 2025 Earnings Call Highlights: Strong Profit Growth Amid ...

Nov -05

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How Analyst Perspectives Are Shaping the Evolving Story for Bank Pekao

Oct -26

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.71%)

6. Segments

Retail Banking

Expected Growth: 2.0%

Bank Polska Kasa Opieki S.A.'s 2.0% retail banking growth is driven by increasing demand for digital banking services, expansion of branch network in rural areas, and strategic partnerships with e-commerce platforms. Additionally, the bank's focus on customer experience, competitive interest rates, and innovative product offerings have contributed to the growth.

Corporate and Investment Banking

Expected Growth: 1.5%

The 1.5% growth in Corporate and Investment Banking at Bank Polska Kasa Opieki S.A. is driven by increasing demand for debt capital markets, expansion in transaction banking services, and growth in mergers and acquisitions advisory. Additionally, the bank's strong relationships with Polish corporates and improving economic conditions in Poland contribute to the segment's growth.

Enterprise Banking

Expected Growth: 1.2%

The 1.2% growth in Enterprise Banking from Bank Polska Kasa Opieki S.A. is driven by increasing demand for cash management and trade finance services from large corporations, expansion into new markets, and investments in digitalization, resulting in improved operational efficiency and enhanced customer experience.

Private Banking

Expected Growth: 1.8%

The 1.8% growth in Private Banking from Bank Polska Kasa Opieki S.A. is driven by increasing high net worth individuals in Poland, growing demand for wealth management services, and the bank's strategic expansion into affluent segments. Additionally, the bank's digital transformation and personalized services have enhanced customer experience, attracting more clients and driving growth.

Assets & Liabilities Management and Other

Expected Growth: 0.8%

Bank Polska Kasa Opieki S.A.'s 0.8 growth in Assets & Liabilities Management is driven by effective risk management, diversified loan portfolio, and strategic investments. In Other segment, growth is fueled by increasing fee income, cost optimization, and expanding digital channels. These drivers enable the bank to maintain a stable financial position and drive growth.

7. Detailed Products

Current Accounts

Bank Pekao's current accounts provide customers with a convenient and secure way to manage their daily finances, with features such as online banking, mobile banking, and debit cards.

Savings Accounts

Bank Pekao's savings accounts offer customers a safe and profitable way to save money, with competitive interest rates and flexible access to funds.

Credit Cards

Bank Pekao's credit cards provide customers with a convenient and flexible way to make purchases, with features such as cashback, rewards, and travel insurance.

Personal Loans

Bank Pekao's personal loans offer customers a flexible and affordable way to borrow money for various purposes, such as debt consolidation, home improvement, or unexpected expenses.

Mortgage Loans

Bank Pekao's mortgage loans provide customers with a range of options to finance their dream home, with competitive interest rates and flexible repayment terms.

Investment Products

Bank Pekao's investment products offer customers a range of options to grow their wealth, including mutual funds, stocks, and bonds.

Insurance Products

Bank Pekao's insurance products provide customers with protection against various risks, including life insurance, health insurance, and property insurance.

Business Banking

Bank Pekao's business banking services provide businesses with a range of financial solutions, including cash management, trade finance, and lending.

8. Bank Polska Kasa Opieki S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Bank Polska Kasa Opieki S.A. is medium due to the presence of alternative financial institutions and digital payment systems.

Bargaining Power Of Customers

The bargaining power of customers is high due to the high level of competition in the banking industry, giving customers the power to choose from a range of financial institutions.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the bank's strong financial position and ability to negotiate with suppliers.

Threat Of New Entrants

The threat of new entrants is medium due to the regulatory barriers to entry in the banking industry, but the increasing trend of fintech companies entering the market.

Intensity Of Rivalry

The intensity of rivalry is high due to the high level of competition in the banking industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 46.88%
Debt Cost 8.86%
Equity Weight 53.12%
Equity Cost 8.86%
WACC 8.86%
Leverage 88.27%

11. Quality Control: Bank Polska Kasa Opieki S.A. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

232.4$

Current Price

232.4$

Potential

-0.00%

Expected Cash-Flows