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EBRD becomes shareholder in Bank BGŻ BNP Paribas

By Axel  Reiserer

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  • EBRD to acquire stake of about 4.5 per cent in Bank BGŻ BNP Paribas
  • Investment supports completion of BGŻ BNP Paribas’ acquisition of Raiffeisen Bank Polska
  • EBRD to invest PLN 430 million

The EBRD is becoming a shareholder in Bank BGŻ BNP Paribas S.A. with an investment of PLN 430 million corresponding to a stake of about 4.5 per cent.

The engagement takes place in the context of the completion of BGŻ BNP Paribas’ acquisition of the core assets of Raiffeisen Bank Polska S.A. as announced in April 2018.

The transaction also supports the plans of the majority owner BNP Paribas to maintain and gradually increase the free float of BGŻ BNP Paribas’ shares on the Warsaw Stock Exchange in accordance with BNP Paribas’ commitment to the Polish Financial Supervision Authority (Komisja Nadzoru Finansowego).

Bank BGŻ BNP Paribas is a universal Polish Bank. The bank is currently the sixth largest bank in Poland with a market share in loans of 5.0 per cent and 4.5 per cent in deposits. The bank also operates in a unique agro-segment niche (thanks to BGŻ’s heritage), in which it is the undeniable market leader with a share of 33 per cent in terms of loans to the agri-food sector.

The investment supports (1) BGZ BNP Paribas’ increased competitiveness as it transforms itself to reap economies of scale from the integration of Raiffeisen Bank Polska and (2) the strengthening of the Polish banking sector through successful consolidation in a competitive environment.

Lucyna Stańczak-Wuczyńska, EBRD Director, Financial Institutions, EU Banks, said: “This is a landmark transaction which will strengthen and enhance competition in the Polish banking sector. Both are extremely important to provide ongoing support to Poland’s fast growing economy where the demand for finance is high. The EBRD is proud that with this investment we will be able to deploy our strengths and become part of BGŻ BNP Paribas’ success story.”

The transaction involves a contractual arrangement of BNP Paribas and EBRD including customary representations and warranties as well as a support arrangement relating to a potential future disposal of BGŻ BNP Paribas shares by the EBRD connected to the sale price achieved. This arrangement is available to the EBRD only for a limited period at a future date after the expected completion of the free float commitment and is subject to financial and other limitations agreed between BNP Paribas and the EBRD. There is no put option or other arrangement that would oblige BNP Paribas to acquire the EBRD’s shares in BGŻ BNP Paribas. The EBRD has also agreed with BNP Paribas not to transfer its shares in BGŻ BNP Paribas prior to 6 January 2019, but there is no contractual requirement for the EBRD to retain its shareholding beyond that date.

Since the beginning of its operations in Poland in 1991, the EBRD has invested €9.3 billion in 405 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.

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