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European Bank invests in Poland's first major commercial bank privatisation
The European Bank for Reconstruction and Development today announced an equity investment in one of the first state banks to be privatised in central and eastern Europe. The Bank has signed an agreement to subscribe for 1,826,000 New Shares offered today in Wielkopolski Bank Kredytowy SA (WBK), one of the largest commercial banks in Poland, for a total consideration of Zloty 210 billion (ECU 10.6 million equivalent). The subscription by the European Bank represents 28.5% of WBK's increased capital.
The Minister of Finance, Mr. Jerzy Osiatynski, said that the privatisation in WBK is "one of the most important steps so far in Poland's privatisation programme. The European Bank's decision to invest is a clear vote of confidence in WBK and the Polish financial system."
Ron Freeman, First Vice President for Merchant Banking, said "This is a landmark transaction for the Bank. Not only is the Bank actively supporting Poland's first major privatisation of a commercial bank by buying its shares but, more importantly, we are showing the way for other investors, giving them the confidence to invest in what could become a major and prosperous financial institution."
WBK is one of the nine state-owned regional commercial banks created out of the National Bank of Poland in February 1989. Of these banks, WBK has been a leader in taking active and successful steps to address the problems of its bad loan portfolio and to instil sound commercial banking principles throughout its operation.
The privatisation of WBK will comprise two parts. The first will be a strengthening of its capital base through an issue of the new shares to the European Bank while the second will be a two tranche public offering of existing shares owned by the Polish Treasury to be launched 13 April.
The European Bank's subscription is conditional upon the State Treasury receiving applications for a minimum of 460,000 shares in the Public Offer.
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