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Central Europe
June 9, 2017 www.intellinews.com I Page 13
just over three weeks to go ahead with a float.
RBI confirmed to bne IntelliNews that it has asked to suspend the process, suggesting there is some room to talk with KNF. “We are in discussions with the Polish regulator about the IPO,“ RBI spokesman Christof Danz said, without offering further detail.
A source at the Austrian group hinted that the bank is hopeful of delaying a deal that is strug- gling. Pricing conditions in the Polish banking market remain unfavourable as lenders continue to face pressure from the government to unwind huge Swiss franc mortgage loan portfolios.
While talk of forced conversion is off the table due to concerns over the stability of the sector, a bill is in parliament that would require banks to refund forex spreads to customers. Meawhile, the bank tax introduced last year, the low interest rate en- vironment, and raised capital buffer requirements are all impacting on profitability. Raiffeisen Pol- bank reported a net loss of PLN76mn (€18.1mn) for the first quarter.
“The Polish regulator is definitely a tough one but possibly the idea that a delay of the IPO could be beneficial for all parties will be accepted. A non-flying IPO would not be supportive for Polish
markets in general,” the source added. “We still have a lot of restructuring work [to do at Polbank], the source adds.
However, there are hints that the revival of a deal to sell the unit instead of floating a stake could be on the cards. The Austrian group spent around two years trying to offload Polbank, only to see
a deal to sell to Alior – controlled by state-con- trolled insurer PZU – break down in December.
Sources suggested at the time that the tough con- ditions on the market had left but a single bidder, which had pushed the Austrian group too hard on pricing. PZU, which is busy building a new state banking group, announced the same day that alongside state fund PFR it had bought UniCredit out of Poland's second largest lender Pekao.
A sale to state-controlled entities would allow RBI to evade the demand from KNF to carry out the IPO. However, the Austrian bank remains coy on the prospect that it could relaunch efforts to sell the unit.
"The main reason [for the suspension of the IPO process is] protection of the asset value, regard- less of whether we will IPO the franchise or sell it outright," the source says.
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