EBRD invests in PKO Bank Polski subordinated bonds

By Axel  Reiserer

Polish lender raises finance for residential loans

The EBRD has invested PLN 133 million (€32 million equivalent) in zloty-denominated subordinated bonds issued by Polish lender PKO Bank Polski S.A. (PKO BP) as part of its PLN 1 billion (€240 million equivalent) bond programme.

The Tier II capital eligible bonds have a 10-year maturity, are callable after five years and will be listed on the Warsaw Stock Exchange. The bonds are compliant with the European Union’s Capital Requirements Regulation and Capital Requirements Directive IV (commonly referred to as CRR/CRD IV or Basel III).

Lucyna Stańczak, EBRD Director of EU Financial Institutions, said: “We welcome the successful placement of the PKO BP bond and we are pleased to take part in this transaction. It will help PKO BP to obtain long-term financing and positively influence the capital adequacy of the bank and moreover it will deepen and widen the capital market in Poland.”     

PKO BP has committed to allocate the equivalent of 200 per cent of the proceeds from EBRD investments in the bonds to finance loans for environmentally-friendly residential real estate refurbishments.

Grzegorz Zieliński, EBRD Regional Director for Poland and the Baltic states, said: “This investment fits in perfectly well with the EBRD’s priorities for Poland where we continue to make an impact with tackling the largest remaining transition gaps. Supporting the development of the capital market is one area where the Bank can support the Poland’s growing economy.”

PKO BP Group is among the largest financial institutions in Poland and is also one of the largest financial groups in central and eastern Europe. PKO BP is listed on the Warsaw Stock Exchange with a market capitalisation of PLN 52.5 billion (€12.6 billion equivalent) as at end of February 2018. PKO BP had a 17.7 per cent market share by loan portfolio and 17.2 per cent by deposits as at end of September 2017. The State Treasury is PKO BP’s single largest shareholder with 29.43 per cent of total capital.

Ilona Wołyniec, Director, Department for Relationships with Strategic Clients and Financing Projects at PKO BP, said: “We are pleased to have the EBRD once again as an investor supporting the process of raising financing by PKO BP. The successful subordinated bond placement by PKO BP confirms our high credibility on the financial market.”

Since the beginning of its operations in Poland in 1991, the EBRD has invested €8.8 billion in more than 390 projects in the country. In addition to its wide range of products for banks and companies, in recent years the EBRD has built a growing portfolio of investments (both equity and debt) in the Polish financial sector, for which demand remains high.