Polish banks' profit may be wiped out in 2020 as COVID bites

WARSAW, Sept 4 (Reuters) - Polish banks’ net profit may fall to near zero this year as the economic crisis caused by the coronavirus pandemic, ultra-low interest rates, a bank tax, and regulatory burdens hit their results, their industry body warned on Friday.

“A correction of the policy towards the banking sector is necessary to maintain the sector’s stability and its ability to finance economic development,” head of the Polish bank association Krzysztof Pietraszkiewicz told reporters.

He called on regulators not to collect multibillion contributions from banks for three years and on the government to earmark half of the revenues from the bank tax for bank guarantee funds.

Last year, the 10 biggest banks paid 3.8 billion zloty ($1 billion) to state coffers via the bank tax alone, while the cumulative net profit of the sector amounted to 14.7 billion zloty. The total contribution to bank guarantee funds was set at 2.8 billion.

The finance ministry was not immediately available for comment.

In the first half of this year, big banks suffered from falling profits, but most of them remained in the black.

$1 = 3.7808 zlotys Reporting by Marcin Goclowski; Editing by Mark Potter