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The pendulum swung again late on July 2 in the ongoing debate over whether a wave of consolidation is on the way in the Polish banking sector, as the head of Italian giant UniCredit insisted its Polish unit Pekao is under no pressure to make acquisitions. His words contradict the head of the local subsidiary and several other Polish bankers, but fall in line with claims made by the regulator KNF.

Unicredit's CEO Federico Ghizzoni told Dow Jones that Pekao - the country's second largest bank - is under no pressure to buy to keep pace with the other top lenders in the country, and that it will focus on growing its current assets. "We aren't pressurized by moves by competitors," Ghizzoni said. "We are focused on organic growth. But we're carefully watching markets and if we see opportunities, we will evaluate them."

That flies in the face of claims from executives from the country's top banks, including the CEO of Pekao. Speculation that the Polish banking sector is set for a wave of consolidation as the major players compete for greater market share kicked off in ernest in mid-June, when the country's biggest bank, PKO, bought the local unit of Scandinavian bank Nordea. That acquisition is reported to have put pressure on other leading Polish banks - mostly foreign owned - to seek growth through M&A in order to keep up. Meanwhile, several smaller EU lenders with assets in the country are thought to need to sell.

Pekao CEO Luigi Lovalio told Gazeta Wyborcza in an interview published on June 28 that the PKO purchase has his bank on the lookout for targets. "We are looking at the market with caution. If an opportunity, that will let us grow, appears, we will do everything to take advantage of it."

According to Reuters, banking sources report that Pekao was also in the hunt for the Nordea assets bought by PKO. Spain's Santander - which controls third largest Polish lender Bank Zachodni WBK - and France's BNP Paribas were also said to be in the running, and market speculation suggests the buyer for the next deal in the sector is likely to come from among those firms.

The theory is that the leading players are now in a race to hoover up the assets of those European banks struggling to keep up with capital ratio requirements, as was seen in a series of deals between early 2011 and 2012. Although expectations of a divestment by Germany's Commerzbank of BRE Bank has died down in recent months, speculation persists that Portugal's Millennium bcp will soon be forced to put its Polish unit up for grabs. Growing retail player Alior pushed through an IPO in Warsaw last year, but is reported to need to find a strategic investor by the end of the year.

Dutch Rabobank only bought out the remaining 40% stake in agricultural specialist BGZ from the state - at a huge price - less than a year ago, but it is one of the first names expected to be sold. Without citing sources, Parkiet reported on June 28 that a PLN2.7bn deal will go through this year.

"We are looking at the market and our position in the market regarding our size," a Rabobank spokeswoman told Reuters on June 28. "There is so much happening in that market at the moment, we are looking at what is the best strategy. That is not necessarily selling."

If Rabobank doesn't sell however, it would likely need to buy to shore up its share of the Polish market, and the Dutch bank has been struggling to keep up with the Eurozone's strengthened capital requirements as the crisis drags onwards. It is in the midst of a restructuring that will see 3,000 jobs cut and a refocusing back onto its "core business" of lending to Dutch farmers. It lost its triple-A credit rating from Standard & Poor's in 2011, leading to the sale of fund manager Robeco, as well as Swiss private bank Sarasin. Amongst mooted suitors for its Polish unit are ING Groep, BNP Paribas and Credit Agricole, as well as Polish lender Getin, which is currently conducting a buyback.

Meanwhile, the UniCredit CEO's claim that Pekao is not looking for acquisition targets may be motivated by a desire to avoid provoking the market watchdog. Ghizzoni has enjoyed an antagonistic relationship with KNF in recent years, focused on the regulator's strict policing of dividend limits, which it set to try to stem the risk that Eurozone banks would seek large payouts from their local units in order to channel capital back to the parent.

KNF has regularly expressed concern over the risks inherent in the concentration of foreign ownership in the banking sector. Little surprise then that head Andrzej Jakubiak, insisted on June 20 that KNF is aware of no interest from foreign players in further acquisitions, and said that the regulator would seek to block any significant consolidation. However, should any foreign parent bank be struggling to support its Polish operations, it would clearly be preferable to allow a deal to go through rather than see a drop in investment or even a collapse.