Financial rating

On 14 September 2022, the Fitch rating agency notified the Bank that its long-term issuer’s rating (IDR) was lowered from “BBB+” to “BBB” with a stable outlook, the domestic long-term rating was lowered from “AA(pol)” to “AA-(pol)” with a stable outlook, and the viability rating was lowered from “bbb+” to “bbb”. The short-term issuer’s rating (IDR) was affirmed at “F2”, and the domestic short-term rating at “F1+(pol)”. The government subsidy rating was determined at “no subsidy.”

Following the justification of Fitch, the decrease in the viability rating, long-term issuer’s rating (IDR) and domestic long-term rating for Pekao mostly reflects the decrease of the rating of the Polish operational environment from “bbb+’ to “bbb” and the Fitch’s assessment that it worsens the overall credit profile of Pekao, taking into account wide exposure of the bank to the Polish operational environment.

Ratings of Pekao Bank reflect its strong market position and stable business model. In connection with the moderate risk appetite, it enables generating relatively stable profits and a solid capital, and maintaining favorable financing capabilities and liquidity position. At the same time, the general credit profile of Bank Pekao is limited due to risk present in the Polish operational environment, as the bank is largely exposed to a variety of clients and business segments in Poland.

On 27 January 2022, S&P Global Ratings affirmed the existing ratings and the stable rating outlook for the Bank. According to S&P, the rating reflects the Bank’s strong business position and the high level of customer trust due to the fact that the bank has strong State-related shareholders, PZU and PFR. It is the opinion of the Agency that acquisition and integration of some of the assets and equity and liabilities of Idea Bank has no material impact on the capital ratios and risk profile of Pekao Bank. Both the profitability and efficiency of the Bank continue to rank similarly to other Polish banks and higher compared to many international institutions. S&P thinks that the Bank’s involvement in CHF loans is irrelevant. The Pekao’s stable outlook is reflected by the outlook of its biggest investor – PZU.

On 20 December 2022, Moody’s announced that it maintained the Bank’s ratings at the previous level and the Bank’s stable rating outlook. Following the justification provided by Moody’s, the Bank’s capitalization and profitability provide sufficient buffers to absorb possible risks. The Bank’s small exposure to CHF loans, amounting to approximately 1% of net loans, would even allow the Bank to fully observe its exposure to these loans without a significant impact on its capitalization. Moody’s points to the high coverage ratio of non -performing loans of 96% as at 30 September 2022, excluding the portfolio acquired by Idea Bank which holds the guarantee of the Bank Guarantee Fund. Moody’s rating also takes into account high capital buffers of the Bank together with the CET1 equity ratio of 15% in September 2022 and expectations as to the Bank’s profitability.