The results of the bank and the trends accompanying these results will be discussed by members of the board. President Piotr Żabski, who is some of the most important trends in the business sector, Zdzisław Wojtyła will present the finance results, and Marcin Kiszewski will present the risk sector results. In the second part of the meeting, after the presentation, we will move on to a question -and -answer session. Before I hand over to Piotr, I encourage all those who are watching us to ask questions already in the first part of the conference, thanks to which we will be able to move on and move to the Q&A session. I hand over to Piotr Żabski.
Good morning, everyone. May I welcome everyone at the meeting of the Board, which is a traditional quarterly meeting to present the results of the bank. This is the first quarter after our strategy was announced, and the second quarter where the strategy is in place, so there will be some reference to what had been discussed in our three-year strategy. As concerns the operating activities, let me tell you about some general trends and results. There will be a division into business lines, and in the further parts, my colleagues will go deeper into the data and a handful of details will be presented to you.
As regards the bank's operating activities, the second quarter was a very good one for us. We noted a 6% increase of revenues, and in the second quarter, we had $1.5 billion revenues. In two lines, both in the interest and commission results, we had 4% and 3% growth respectively. The net profit of the whole of the bank was $640 million, and it was by $50 million higher, 9% more, compared to the same period of the previous year. The ROE reached 22%, as you can see in the slide. What we would like to draw your attention to is also the decrease in the cost of risk due to the recognition of profit on the sale of the NPL portfolio. It reached the result of 0.2%, which is quite notable as far as the COR is concerned.
There is also a continued decline in the NPL ratio to 6.18%. The sale of the NPL portfolio obviously had an impact on that, but in our strategic aims, we are certainly moving on targets. As far as our capital position is concerned, there is a surplus over Tier 1 to the tune of almost $5 billion, and in TCR, almost $4 billion, which vis-à-vis our strategy provides us an increase of scale and a safe buffer. The TCR at the level of 17% is certainly considerably above the reference regulatory benchmark. A few additional figures regarding our activities in the last quarter, and indeed the first half of the year, the number of relationship customers grew. We now have 1.64 million customers. That's a growth of 81,000 compared to the previous year. The mobile app users also grew.
We now have 1.5 million who use the app, which is by 13% more than a year ago. We had some problems concerning the use of the app, but we overcame them. There was a growth in the deposit portfolio. We now have almost $80 billion total in deposits, an increase of 8%. There is also a strong growth in the area of mortgage loans. In the second quarter, we granted loans to the tune of $1.3 billion, which is almost a twofold increase compared to a year ago. The share of these loans in the general sales portfolio is 1/3. You also probably realize that we paid out the dividend. This is not a new piece of information, but this is part of our strategy. Some additional info as regards the whole of the bank. Our assets are almost $100 billion. There was a 10% growth.
Deposits grew by 8% to almost $80 billion, and the gross performing loans grew by 4% to the amount of $62 billion. An important bit of information which you find in the footnote at the bottom, the 4% growth does not take into account the buy/sell-back transaction, so whether working loans. Now, additional information in the top line in yellow, there is the second quarter and the bottom line, the whole of the first half of the year. CER 36.1. Zdzisław will tell you in detail about what brought it as this cost-to-income ratio at such a good level. NIM discounts the drop in interest rates, which you can see. ROE at almost 22% for the whole of the half of the year. Cost of risk is 0.20%. As far as the share of the mobile app among relationship customers, the growth represents 4.7%.
Sales is on the rise, and we hope that the new solutions which we will be offering and which will enter the market will even increase this positive growth trajectory in the mobile channel. Now, a few words about other elements, the balance of assets of retail customers. The top left-hand corner, quarter -on -quarter and year -on -year, we have 10% slightly modification between different positions. The biggest growth that we noted was in the area of investment funds, which we're very happy about because it's one of the elements of the growth as far as our commission and income is concerned. As for the gross loans to retail customers, there's a slight change in the share of the consumer loans and real estate loans.
There are more real estate loans now than the consumer loans, which at the bottom left-hand corner, if you break it down, you see a stable position as regards the installment loans. The total growth in the volume is almost 20%, which is considerable. In the installment loans in the first and the second quarter in the whole of the installment loan sector, there was a negative dynamic, but we maintained our position, which is very good. There's a growth in the cash loans, the high commission loans, which provides a good boost to our income.
I think the most interesting information in the top, in the bottom right corner shows us how mortgage loans are growing in terms of sales. The last time that we were comparing ourselves to the situation where the safe loan 2% was quite significant. If we see the pink color, that's almost a twofold increase in that item. That makes us very happy because on the one hand, we are stabilizing part of the assets, extending the assets, and we know that this is a protected portfolio marked by lower risk. A glance at business customers, that's our second business line, who will soon be explaining also in greater details what it looks like. When it comes to the portfolio or the volume of loans, it's stable.
At the same time, the total credit limit allowed to business customers is on the increase, while at the same time, we have a significant decrease in non-performing loans. We're working on it very much. These two curves are balancing each other. Hence, the portfolio is still at a flat position. It's not growing. If you look at the trends, we grow faster when it comes to sales. We are decreasing the NPLs, which means that it will be visible soon. When it comes to the deposit volume, we have an increase of 7% year -on -year. Active debit cards, 4% year -on -year, 6% when it comes to the micro segment. Importantly, the micro segment had negative dynamics in the first quarter. We did not see or the market was not performing as we assumed in the strategy.
The 67% in terms of our activity, I mean, our activity was focused on preparing the newest solution to be ready this autumn. Hopefully, with a new application, we believe that this result will be significantly better. Our company's activity, the largest subsidiary activity, which is Alior Leasing, the portfolio reached almost PLN 7 billion, specifically PLN 6.8 billion, and grew by 6% year -on -year. As you can see, quarter -to -quarter by 2%. The sales of leases is marked by double-digit growth, 11% quarter on quarter. It's important that we have specialized in certain niches. A very strong leg of it is a very significant share in the leases of vehicles exceeding 3.5 tonnes, where we even have a market share of 17%. That's only to draw attention to this. A couple of additional words on pursuing our strategy when it comes to the transformation or sustainable funding.
Firstly, we have a comprehensive offer for entrepreneurs' specific proposal to fund energy from renewable sources such as wind, sun, water, biogas. We also fund hybrid installations. We are ready, and we've started being very active in this market. A second item is that in cooperation with BGK, we have obtained access to European funds, EU funds. Owing to this, in several provinces, Wielkopolskie, Podlaskie, Małopolskie, Zachodniopomorskie, and Łódzkie, we've been able to provide our offer of low-interest loans to reconstruct and expand installations connected with RES and to improve energy efficiency, which means that we are also being active in this area, which is also aligned with the assumptions of our strategy. I would end on this slide and ask Marcin to present our results when it comes to the credit risk.
Good morning, ladies and gentlemen. Piotr has mentioned our safe capital position in his statement and about the significant surplus regarding the regulatory minimums. We intend to further strengthen our position and to having obtained the appropriate permission, also strengthen our capital requirements. In the first quarter, we have performed an early redemption of FCS bonds. That's PLN 400 million with a 3.11% margin and issued the series bonds of 1.95% margin, which translates into a very good ratio exceeding 20%. In the further part of this year, we are considering another issuance of MREL bonds with a value of approximately PLN 500 million. When it comes to liquidity ratios, both short-term and long-term are also at a safe level. LCR has attained 227% and NSFR 146%. Passing on to credit risk, we close the cost of risk at the level of 0.47%.
However, these amounts are lowered by one of the results of the NPL sales transactions. Excluding that transaction, the cost of risk would be at 0.76%, which is below what we've assumed in the strategy and what we've been communicating to you for a couple of quarters now that our current risk profile should not exceed 0.8%. The profit on the aforementioned sales amounted to over PLN 100 million. The sale of that portfolio, as well as further restructuring and debt collecting activities, have improved our NPL ratio. At the end of the second quarter, it amounted to 6.18%. We are sustaining our strategic assumptions that by the end of 2026, we should reduce the NPL to a level below 5%.
On the next slide, you can see that the gradual work when it comes to both the sales of NPL and the collection is helping us reduce the non-performing loans. At the end of this quarter, we went below PLN 4 billion with a stable coverage ratio. By splitting our impaired loans into the retail segment and the corporate segment, in the retail segment, we are at the market level. The whole share of non-performing impaired loans is 2.67%. In the individual customers' portfolio, in the case of corporate customers, it's higher at 12.41%. However, we have also noted a decrease both on a quarter-to-quarter and year-to-year basis. The cost of risks, when split to both segments, was impacted by the sales. Most of the sales, 85%, was the retail portfolio. 15% was represented by mostly the corporate portfolio. Hence, the negative COR on the retail segment and a positive of 0.78% in the corporate segment. Thank you very much. Over to Zdzisław, who will present the financial results.
Thank you, Marcin. Good morning, everyone. Let us move on to the financial part. As Piotr mentioned, our income year-on-year for the quarter rose by 6%. Taking into account the first half of this year compared to the previous year, it grew by 2%. If we look at the net profits in the red color at the bottom, you see that there's a growth of PLN 54 million between quarters. Between half years, it dropped by 4%. It needs to be explained that in the first and the second quarter, we took into account the costs. We move on to the major part of the income statement.
The first column in yellow is the second quarter of this year. The 10% grew by 6%. Interest grew by 4%. The commission grew by 3%. There's a dedicated slide which gives more details about that. The cost of the group is PLN 695 million. This is a 7% change year-on-year, and we will use a separate slide to describe that. Other lines which will be important are the legal risks. We recognize PLN 44 million of the additional legal risk of mortgage loans in foreign currencies. This relates to the growth in cases. It is not from our point of view. Particularly the big item in the financial statement, you will see that there's 39 additional cases in the first quarter, sorry, the first half of this year. About 20 each quarter. There's a model change which reflects the reality and our expectations.
We do not expect that this line would grow to some considerable degree. Going further down, we see gross profit at the level of PLN 827 million and net profit at the level of PLN 640 million. When looking at some more important lines, we have the interest margin which went down by 8%. We brought down the financing cost. Even though the deposit phase grew, the financing cost dropped by 16%. The cost of risk, which Marcin talked about because of this one transaction in the half year, is at a very satisfying level at 47%. Cost-to-income, I'll show you on the next slide, is 36.1% and return on equity 22%. Now, moving on to the interest income, which is a considerable part of the bank's operations. When you look at the graphs, they are slightly more complicated. However, there is a flat line.
If you look at the first quarter, there is an even 1% drop. We should look at our interest result from a few standpoints. Firstly, our balance sheet. When you look at our products, you will see that there is a considerable growth in the mortgage loans share, which stabilizes our income over the long-term perspective. It helps build our relation with customers, which is a very crucial part of our strategy. However, as for the margin for that product, it is lower than the cash loans. It translates into a lower interest margin. The other perspective is that a considerable part, almost 90% of the sales in the previous quarter, relates to products which are fixed-rate-based. As you well know, in the fixed-rate product, we have a certain market expectation built in. The expectation is that the interest rate will go down.
When we sell our products, by definition, there is a slightly lower level of interest income than it would otherwise be. If you look at the top right-hand corner, you will see that indeed we go down from 5.88% to 5.74%. If we introduce the cost of risk, it is at a quite high level, much higher considering our business model. The market is from 5.50% to 5.54% if we take into account the one-off event. The cost of financing, which we managed to bring down, sets off the drop in the interest income. If we look at the second quarter, what will be crucial is what will happen, what will be the decision of the Monetary Council. That will translate into the way the interest rate will look like, which will obviously translate into how we will be selling our products.
What we see today, looking at our balance sheet and its development and our cost of financing, it seems to us that our interest margin should not go below 10 percentage points. In the next slide, we see the net fees and commission income, especially in the first and the second quarter. We had a 6% growth there. What is important is the first part of the two bars, which is the customer activity, 41 million and 45 million. It's then the brokerage commission. The Alior TFE is a big part of that. This is a fairly new company that was created, and our currency exchange transaction provides good results. The commission grew from 73 to 79. We're very happy that the customers are using this particular channel. The last part of the P&L is the cost dynamics.
As we declared in the strategy at the previous meetings, what we would like our cost to be is to be more under control, more predictable, under careful management. That's what we are able to achieve. If we take BFG costs off, then the costs of management are comparable. They're practically at the same level between the first and the second quarters. What is important is that the cost grew by 7% between. If we deduct the BFG costs, then the costs which are under our management grew by only 5%. It's definitely below the market average, and we expect that in the subsequent quarters, the costs will be maintained under this strict discipline. They should not be higher than just a few percent growth level. The cost-to-income ratio of 36.1, as I mentioned, normalized depicts a more consolidated view once you exclude the loan repayment relief period. It's comparable with the 31 this year. Thank you very much. That's everything as regards to financial information. Over to Piotr.
Thank you very much, gentlemen. Just to put an overarching component to our statements, I'd like to draw your attention to several important facts. We have been very consistently striving to implement our ambitious strategy. We have announced the strategy, and as you've seen in the figures, most of the parameters and readings that we recognize today are aligned to our assumptions. First of all, we are still very much present in the consumer finance market, notwithstanding the performance of that market because we're talking about negative dynamics. Our brand is our major asset.
As we've mentioned, we've refreshed our brand, rejuvenated it, and started reaching groups of younger target customers, which means that the perception of our brand among people who are not our customers is at the highest level over the last couple of periods, which shows that this component has also started performing well. Our agile business model, built on modern technologies and a variety of distribution channels, is being reinforced even more, given that the bank is scaling up the agile model of our capacities. The stable and predictable costs of risks, they are dropping in a negative space. The fact that we were a bank that was what distinguished itself in the negative sense is our part of history. Our new sales are at a different level when it comes to the risk predictability and stability.
The returns that we deliver to our shareholders are still high because they represent roughly 20%, as we promised. Our stable capital position still provides us with a reason to feel good when we are thinking in terms of one of the strategic pillars that mentioned the increase in the scale. At the same time, we are still benefiting from the fact that we are working with or we're part of the group of the leader in the insurance market in Poland. We're benefiting from the access to their products and implementing new solutions that we share with our customers. All of this gives us a sense of comfort in the sense that this year should be another year when we are positive about a prospective dividend payment. As you can see, the bank is doing good. Having said that, I would conclude our presentation. When it comes to the slideshow, we will be very happy to take any of your questions.
Thank you very much, Piotr. The first question is, how much was the WFD and SOTNII at the end of the second quarter?
At the end of June, WFD was 43.6%. The reference period was 40%. SOTNII was 4.4% with the required level of 5% at Tier 1.
Thank you very much, Marcin. The next question, which part of the portfolio is based on the periodically fixed rate?
When it comes to the fixed rate, as of the end of June, we have 35% of the loan portfolio are fixed-rate loans. As I mentioned in the last quarter, the sales of products of fixed-rate loans represent 90%. T
hank you very much. What was the value of the NPL portfolio sold in Q2 2025?
As I mentioned to you in the presentation, part of that portfolio was a balance sheet part and an off-balance sheet. When it comes to the balance sheet part, it was roughly PLN 180 million worth. The off-balance sheet was roughly three times more.
Thank you very much. The next question, the number and value of litigations accelerated in Q2. The bank also increased its provisions for that risk. What were the verdicts and what number is expected by the Board?
When it comes to the statistics, they are maintained at the existing level. We don't observe any increases. Still, very importantly, and notably, the bank wins a vast majority of lawsuits no matter how active the law firms are that have built their business case on trying to achieve their business goals. In that realm, we don't expect any changes, at least until the next verdict of the European Court of Justice, because such verdicts might change the landscape.
Thank you very much, Piotr. Now, the next question, could you update the bank's sensitivity to NAI sensitivity to interest rate changes?
Yes. The answer is quite straightforward when it comes to this question because it's a standard question which gets repeated in all the conferences. I'd like to emphasize that as of today, in the banking sector, we are observing a major change because there's a large number, a relatively large number of assets that are based on a fixed rate or a temporarily fixed rate. This means that the decision on changing the interest rate by 100 bps does not have to translate into the decrease in interest rates on a one-off basis.
This is rather a category that we have to keep in mind. We are estimating the impact of a decrease by 100 basis points by PLN 100 million.
The next question, how does Alior Bank evaluate the profitability of the?
Some banks express their doubts when it comes to the sales of mortgage loans, whereas at Alior Bank, the sales of mortgage loans are significantly growing. The sales of mortgage loans is one of the components of our strategy. It's about building relationships. When it comes to the consumer finance, we will be strong, but we want to increase the transaction banking. For this, we would need longer-lasting relationships with our customers than it would stem from consumer loans. That's why we are so active in the mortgage market. We have an idea of how to deliver products to customers. We know how to do it in consumer finance. We will be translating that into transaction banking. This combination means that we are accomplishing our goals when it comes to the profitability of this product.
Thank you very much, Piotr. The next question, why is interest the result of Alior displaying lower dynamics than the market average?
Let me come back to what I was describing in one of the slides depicting the interest income. Alior Bank is not one of the top five banks. It's rather in the top 10. Our total assets are lower. When there were installments, higher purchase, or consumer finance predominating, it was obvious that our NII and margin was at a relatively high level. Today, we are building a bank in line with the strategy, the relationship-based strategy based on other products. We are implementing mortgage loans, which translates into other rates of return, as presented by Piotr.
It's definitely satisfying for us, but the position is slightly different. Another thing is the mix of products when it comes to the fixed and variable interest rate-based products. Fixed-rate products play a very important role. It's difficult to compare with the banks that have a lower sensitivity to that. The implementation of such a volume of products based on the fixed rate is visible more rapidly. I think it's also a simplification to compare because every bank has a specific situation. It's worth emphasizing, everyone has a different product mix and different dynamics. I think it's slightly incomparable when it comes to the dynamics.
Thank you. The next question pops up frequently at conferences. Is Alior part of the dialogue and the changes in the BJP structure? What are the possible scenarios for Alior Bank?
The scenarios are still the same. There is nothing revelatory in the discussion, which keeps cropping up every now and then. Just this week, there was an interview given by two presidents, which talked about the transaction within the PZU group. Taking into account the possibility that a transaction will transpire, there will be a certain level of ineffectiveness because we will have a bank, an insurer, and a bank again. This is not an effective structure from a number of points of view. In that context, the discussion is taking place. Both presidents, however, mentioned that the transaction has been put off. It is very complicated. It requires a lot of permits and agreements. Our agenda for today is the agenda of our strategy, is the agenda of our business, and that's what we focus on. The bank, being part or not of that, should not be considered.
Thank you very much. The next question, when will the fees and commissions result?
Considerably forward. As we suggested in the strategy, what is important for us and to build a relationship bank, the kind of a bank where customers will want to maintain business relations over a long period of time. We need to propose the best possible solutions to them. We want to provide them with the best possible value. That must be reflected in the structure of fees and commissions. We now work intensely on changing our infrastructure. In terms of business customers, things have been moving forward vigorously, and there will be a new distribution platform and a mobile platform for the business customer, which will provide very big additional value to customers. We provide more platform to generate more fees and commission income.
We're also working on that for the retail customers, and we will be shortly exchanging their mobile app. It will become simpler. We'll also be providing the values which customers require of us. This will increase the number of our customers, the number of relationship customers, the number of transactions, which will also translate into better fees and commission income, which will be a win-win situation.
Thank you very much. When will we see the results of the strategy in the corporate sector?
Leasing is on the up. Other corporate sectors are declining. If you look at the markets, the dynamic was positive. However, the positive dynamic was reflected only in the big businesses. Alior is not, according to our strategy, an active or an aggressive player in that segment, which is now the strongest growth segment.
If we were one of the third biggest banks, then that would be a possibility. We focus on micro enterprises, on mid-sized enterprises. The first quarter dynamic in that sector was slow. You saw in one of the slides, our sales volumes are now on the uptick. We can see the growth, and there will be a game changer in the shape of the new solution that Zdzisław mentioned, which will be unveiled in autumn. New banking, new features, which will surprise the whole of the sector. Thank you. If you think there is a sense of wanting more in the mortgage sales. Can you again explain to us why such a strong growth in the mortgage sales? This is a result of a number of elements. There's not just one thing. We have very good distribution channels. We distribute the product in the so-called long and short channel.
That's the first thing. This has worked very well. Secondly, we improved our offer. We unified certain assumptions regarding the commission and the whole decision-making engine. We extended the offer to bring it across the country, and we played on many instruments at the same time, which created a sort of an orchestra in the mortgage sector, which has produced such a great performance. The whole procedure, from the customer through the procedure to the decision, is very smooth and works very well.
The next question, in the extreme scenario, the Financial Stability Committee assessed the sanction for the sector at the level of PLN 32 billion. What is the extreme scenario for Alior Bank and how much would it cost?
I think this is a very hypothetical situation. This is not similar to the Swiss franc loans. These situations are uncomparable. Proper regulatory bodies have already the loan has not been properly introduced, the sanction regarding that. I don't want to rephrase this question because I don't think it's properly asked, and this is not a place to ask it. We are observing very well the situation. We think there is a lot of unfairness as regards the assumption of the process because it would mean that the legal system would have to be upturned on the basis of unfeasible arguments. The sector is working very strongly to reveal how unfeasible this line of thinking is. The sanction of this free-of-charge loan would have huge consequences, not just for the bank, but for the Polish economy as a whole.
Thank you. The next question, what is blocking Alior Bank from increasing the payout to 75%? Above 5%, is there anything else?
There are a number of aspects to be taken into account. We are taking them into account. The BION assessment is something that I don't want to discuss because it's not confidential. We are on the way to the 5% level. This is part of our strategy. We now pay out 50%, but the target is to go to 75%. Will this happen? Will the payout of 75% happen? It is the decision of the Supervisory Board. We want to reach that level, but the final decision is not up to the Board.
Thank you very much. The next question, what was the reason for the worsening of the consumer loan portfolio deterioration in Q2 2025? If I understand this question correctly, are we talking about an increase or deterioration?
I'm not sure. When it comes to the increase, consumer loans on a quarter-to-quarter basis, we're only talking about a 2% growth. That's insignificant. In Q1, BIG was showing a decrease of consumer loans versus the preceding period. The dynamics are very weak. We are part of the market. We have maintained our position. In Q1, it was dropping. The second quarter, it was slightly positive. We played strong in the second quarter.
Thank you very much. The next question, what is the reason for the outflow of retail deposits in Q2? Has the bank changed its pricing policy in this area?
We've changed the pricing policy in the sense that we were able to show the lower cost of funds, as mentioned by Zdzisław in one of the slides. The outflow meant actually on a quarter-to-quarter basis, it was flat.
The new money that entered the bank, in terms of the new bank, we observed huge increases. When it comes to the outflow, we had a significant aggressive promotion in the previous periods. That promotion is now over. A great proportion of our customers have flown out to the other banks. As we know, customer loyalty is directly proportionate to the price of deposits. What is the outlook for NII in the second half of the year? As I mentioned before, a lot will be pinned on the decision of the Monetary Policy Council in September. I think the whole market is looking forward to that. As we look at this as of today and at the analyst consensus, as well as our expectations, I should say that our average NIM might be lower by 10% versus the existing level.
Thank you very much. The question is whether the new Consumer Loan Act will have an impact on the sales of loans. What about the limitation of advertising?
The new proposed law in the form, the new bill, which is being discussed by the industry, we're also very active in cooperating with the Polish Banks Union and discussing it with the representative and all the institutions. It affects everyone. I'm sure it will have an impact on all the segments, which seems to be inappropriate that it will affect in the same way. I mean, it will affect both the tiny consumer loans as well as major loans alike. It's hard to envisage that the same procedure of allowing credit and the whole bookkeeping process should be applied to a PLN 500 worth loan as well as to a PLN 50,000 worth loan or even higher.
Some of the mortgage loans will also be affected by that. It will be a major change for the whole sector. I'm sure it will impact the bank's propensity to provide funding. We will all probably have to think whether some of the products, given the increased costs triggered by that act, whether it will even be profitable. I do expect some impact, and I don't think it will be positive, rather negative.
Thank you very much. The next question, what do you expect when it comes to the increase in market competition in consumer finance after the advent of EARSTY to bank, as well as leaving Santander Bank as part of Santander Group?
I think that's the question I should answer because that's where I'm coming from. Oh, that's a joke. I'm sure that one of our consumers will be a beneficiary of the brand that will stay, that will be staying in the market. What do we expect? We are looking at our own backyard, at our own agenda. We have our own ideas, our own concepts to grow our business. At this moment, we are leaders when it comes to higher purchase, to installment loans. This is testified to by the volumes and the fact that consumers vote for us by acting, by choosing Alior Bank. I won't be discussing our ideas as of today. I won't be reviewing them. You can see by our strategy that it's a major item of our strategy. We want to leverage towards transactional banking. This consumer is very much needed, and we won't give a single inch of the battlefield.
Thank you very much. The question is, in the first half of the year, the cost of risk is 50 bps, and the expectations throughout the year when it comes to the COR are unchanged. Does this mean that the COR should be higher in the second half of the year?
As I was telling you, the ongoing production is aligned with our assumptions. As of today, we don't perceive any events regarding the working portfolios or basket one or two. Therefore, we assume that the COR, without the impact of one-offs, in the next quarter should not exceed 0.8%.
Thank you very much. The next question is, can you see an increase in flow of litigations based on euro-denominated loans?
As I mentioned, the inflow of those litigations is at the existing at a constant level. The bank does not perceive any major acceleration.
We have assumed an even more conservative approach when it comes to provisioning. Therefore, we've opened PLN 40 million, which seemed immaterial from our point of view, but they just put some order, streamlined the modeling approach in coordination with our group auditor. We are not assuming any significant write-offs regarding that portfolio in the upcoming period.
Next question, is the bank still refunding consumer credit contracts? If so, to what extent is the result on income, as well as the commission's income affected by this?
We've had such practice, but this activity has been discontinued. We are not being active when it comes to the consolidation. I understand that SKD would be the main trigger. Yes. As you look at the consumer credit market and the data published by BIK for many years, the situation is that customers flow between banks, and the consolidation represents a major proportion.
SKD is not the trigger. Of course, we have consolidation. We also attract customers from the market by offering this product, but it's not our goal to take care of the problem of the free loan sanction. From the P&L perspective, if we look at Q1 and Q2, that consolidation was more important in Q1, and we can estimate it at the level of several million PLN only.
Thank you very much. The next question is, what impact on the commission's income was triggered by the implementation of the Exchange Office?
The Exchange Office is a very interesting product that was very positively perceived by the customers, and we're happy that they should be using it to such an extent. It's a little bit too early to try to evaluate this, but the currency exchange will be also provided as part of the app.
It's about increasing the customer comfort and the bank's results. We could see it in the EFX results. They were better by PLN 5 million on a quarter-to-quarter basis based on the exchange results.
What level of MBP reference rate do you assume for the end of 2025 and 2026?
At the end of 2025, 4.85%, and the end of 2026, 3.75%.
Thank you. These are all the questions. We want to thank the Board and thank everyone for watching, and we would like to invite you to the next meeting.