EBRD takes part in a deal to create Poland's third-largest bank

By Svitlana  Pyrkalo

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The EBRD is continuing to support growth in the Polish banking sector by participating in a deal which will create the third-largest bank in Poland.

The EBRD is investing PLN 332 million equity in Bank Zachodni WBK S.A. (BZ WBK) by subscribing for new shares in BZ WBK in a private placement transaction. This investment will  back the proposed merger of BZ WBK, a subsidiary of Banco Santander, S.A., and Kredyt Bank S.A. (Kredyt Bank) - a medium-sized Polish bank currently majority-owned by the Belgian KBC Group.

The aim of this equity investment is to support the consolidation of the third-largest bank in Poland which will benefit high-level competition in the "top tier" segment and constitute a positive systemic development for the country’s banking sector. On completion of the proposed merger, the EBRD would hold a minority equity stake in BZ WBK.

Sylvia Gansser-Potts, the EBRD Director for EU Banks, said: "The transaction between Bank Zachodni WBK and Kredyt Bank is a very important and positive development, which the EBRD welcomes and supports. We believe that the creation of a stronger player will benefit the banking sector in Poland. At a time when most banking groups are retrenching rather than expanding in our region, the EBRD welcomes the further commitment of the Santander Group to Poland, which demonstrates the attractiveness of Poland to strategic investors."

Gerry Byrne, Chairman of the Supervisory Board of BZ WBK, said: "Bank Zachodni WBK is delighted that the EBRD has decided to become a shareholder. The EBRD will bring not only its financial contribution but also significant knowledge and experience. This investment represents an important vote of confidence in the bank, in the eventual merger with Kredyt Bank and the prospects of growth for the combined institutions."

Mateusz Morawiecki, CEO of BZ WBK, said: "We are happy that we have attracted such a renowned and experienced investor. The EBRD’s investment is further proof that our banking sector is attractive, stable and safe. The EBRD will provide strategic support in the process of merging Bank Zachodni WBK and Kredyt Bank. I believe that  the EBRD’s investment in the envisaged merged bank will additionally strengthen the foundations of  the Polish banking sector and contribute to its further growth."

The EBRD investment is subject to the Polish Financial Supervision Authority (Komisja Nadzoru Finansowego) consenting to relevant changes to the statutes of BZ WBK and BZ WBK's shareholders adopting the relevant resolutions.

The equity investment follows earlier financial support granted by the EBRD to BZ WBK in the form of loans and credit lines totalling €165 million, including the subordinated eurobond of €100 million issued to the EBRD in 2010.

In 2011 the EBRD invested almost €900 million in 21 projects in Poland. Poland is the fourth biggest country of the EBRD's operations in terms of investment volume.

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