Poland's KNF approves Raiffeisen Bank Polska and Polbank EFG merger
Date: Dec 07, 2012
Categories: Retail Banking
Keywords: Raiffeisen Bank Polska, Polbank EFG
December 5th 2012 – Yesterday, the Polish Financial Supervision Authority KNF approved the application of Raiffeisen Bank Polska to merge with its full subsidiary Polbank EFG. The legal merger of the two banks is scheduled for the turn of the year. The regulator's decision allows further steps towards the full integration of both institutions under the new brand "Raiffeisen Polbank". The operational merger is planned to be completed by the end of the first half of 2014.
As Poland's seventh-largest lender, serving customers in nearly 400 branches throughout the country, Raiffeisen Polbank will be among the country's leading banks. In order to fully leverage synergies that arise of the joint operation, as well as to acknowledge the currently rather cautious outlook for the domestic economy, new regulations and reduced demand for conventional banking services, the new bank will undergo a restructuring programme. This programme will comprise, among other issues, the reduction of the joint workforce and the closing of a limited number of branches.
Therefore, new staff will not be hired to replace those leaving on their own. The overall level of employment at the end of 2015 is planned to be about 6,000 people in full-time equivalent (as of 30 September 2012: 6,471). The reduction in employment will mainly affect the retail segment and parts of both banks' head offices. Some branches located in direct proximity to each other, therefore providing no additional benefit to customers, will also be closed.
"The merger between Raiffeisen Bank Polska and Polbank is a perfect fit of two excellent banks having practically operated in two different market segments until now. This is why the overlap between the banks is rather limited. Still, a merger process always entails redundancies in processes, structures and, not least, staff. And Poland's current macroeconomic situation, the strong competition on the banking market, increasing capital and liquidity requirements, coupled with on-going automation of processes and the development of electronic service channels – which are often preferred by customers – are forcing an increasing number of banks to take cost-reducing steps even if not involved in such a process. We have started quite a number of initiatives regarding savings that will not affect staff and will of course do our utmost to minimize the consequences for colleagues whose employment we will have to terminate," said Herbert Stepic, CEO of Raiffeisen Bank International, Raiffeisen Bank Polska's parent company.
The restructuring programme shall strengthen Raiffeisen Polbank's position on the market as a universal institution serving all customer segments, therefore providing a strong basis for the bank's healthy development, not least for the benefit of its almost 900,000 customers. The merger between Raiffeisen Bank Polska and Polbank EFG combines the excellent international standing of Raiffeisen as a financial brand with the high recognition of Polbank in the local market, as well as the pure retail footprint of Polbank with the strong position of Raiffeisen Bank Polska in the corporate and SME segment. The new bank's managing board will be headed by Piotr Czarnecki, currently CEO of Raiffeisen Bank Polska, as CEO and Kazimierz Stanczak, currently President of the Management Board of Polbank, who will be First Vice President.
Re-disseminated by The Asian Banker