UniCredit reportedly mulling full exit from Polish unit Pekao

By bne IntelliNews July 27, 2016

UniCredit may sell the remainder of its stake in Poland’s second largest lender Pekao, as the Italian banking group continues a drive to boost capital buffers, newswires reported on July 26.

UniCredit offloaded a 10% stake in Pekao earlier this month, leaving it with a 41% controlling stake in the Polish lender. However, unnamed sources claim to Bloomberg that the Italian group’s new CEO Jean Pierre Mustier will seek to further strengthen the group's position. Other than increasing capital buffers, the group needs to reduce costs and improve profitability as it is burdened by non-performing loans and low interest rates.

The most direct way to increase capital buffers is to sell assets. In July, UniCredit sold 10% of Pekao to a group of unspecified investors for an estimated PLN3.3bn (€749mn). A similar interest in online lender Fineco raised €328mn. Mustier is now mulling what the PLN13bn or so he could raise from selling the rest of Pekao could do for the drive.

The news is likely little surprise in Warsaw, where officials have spoken of interest in taking on Pekao under a plan to raise state ownership in the Polish banking sector. “It’s clear that the decision to change Pekao’s ownership structure has just begun," Deputy Prime Minister Mateusz Morawiecki told PAP after the sale of the 10% stake. "We will be trying to increase the role of Polish institutions in the [banking] industry."

Some “repolonisation” has already taken place. State-controlled insurer PZU is playing the leading role via Alior Bank, in which it secured a major stake in May 2015. The pair is currently moving forward with an acquisition of BPH from GE Capital. The insurer has said a number of times in recent weeks that it would be keen to buy Pekao should it come up for grabs. Raiffeisen Polbank is another target.

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