PZU takes further steps in becoming Poland's fifth largest bank

10 March 2016 — Daniela GHETU
The Polish leading insurer PZU seems to be taking further steps in developing its plans to play a significant part in the Polish banking system's consolidation and simultaneously to find a new growth reservoir for its future development. Thus, as reported by Reuters, ALIOR Bank, owned by PZU, is in talks to buy its rival Bank BPH from General Electric and hopes to complete a deal around mid-2016.

In fact, the planned acquisition is confirming the Polish insurance giant strategic plans revealed about one year ago, by PZU's CEO Andrzej KLESYK who told reporters that the group is eyeing multiple banking acquisitions in Poland,. "We are looking at the deals," he said, explaining that for PZU "acquisition of a single bank would make no sense."

"Alior plans the bank acquisition transaction during the second or third quarter. The plan assumes that Alior will conduct a rights issue to raise money both for the bank and to strengthen its own capital position," a source familiar with the matter stated for Reuters.

Although both ALIOR and GE refused to comment, it seems that selling BPH is part of a strategic decision of the American group to withdraw from some of the CEE financial markets. On the other hand, PZU has previously stated that it may spend up to PLN 9 billion for acquisitions, in the attempt to create the nation's fifth largest bank. GE's 87 percent stake in Bank BPH has a market value of PLN 2.2 billion, while the bank's assets are worth roughly PLN 32 billion zlotys. By mid 2015, PZU has also submitted an offer to buy Raiffeisen Bank International's Polish arm, Polbank, but the acquisition was not been yet finalized.

"We believe that in the upcoming years banking will become an equally robust foundation for PZU's operations as its other areas", said Andrzej KLESYK, CEO of PZU SA, on the occasion of group's 3Q results reporting.

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