Bank privatization misses deadline
So far Poland has privatized three out of nine former central bank branches and two more, Bank Gdanski SA and Powszechny Bank Kredytowy SA, are slated for sale late this year.
But Kolodko said it would be hard to sell the four remaining banks, Powszechny Bank Gospodarczy SA, Bank Zachodni SA, Pomorski Bank Kredytowy SA and Bank Depozytowo-Kredytowy SA, in 1996 even if they were merged and floated as one group.
"At this point it is hard to imagine that all nine banks could be privatized by the end of next year," Kolodko told a news conference. "First of all there is a demand barrier," he added.
Poland set the 1996 deadline in a privatization plan in 1991, when it asked seven Western governments to support the scheme with about $700 million in capital to help the banks clean up their bad debt portfolios. But Kolodko said that as the schedule could not be kept, Poland would discuss with the United States and other donor countries a possible change of the deadline.
"We will talk with the participants of the fund about a new deadline of the completion of the privatization (of the banks)," Kolodko said.
Finance Ministry officials said the program got seriously delayed after a controversial sale of Bank Slaski early in 1994, when the government and the bank's officials drew fire for underpricing and mismanaging the issue. The next privatization, of Bank Przemyslowo-Handlowy, came off only in January 1995 when bearish market sentiment forced underwriters to take up almost 40% of the 50% public offer.
Jaroslaw Biernacki, head of the ministry's banking department, earlier said banking privatizations were increasingly difficult because the market had become saturated with banks.
"Banks now account for 40% of the Warsaw bourse's capitalization and it is not easy to place several financial institutions over a short period either on the domestic or foreign markets," he said.
But Kolodko said it would be hard to sell the four remaining banks, Powszechny Bank Gospodarczy SA, Bank Zachodni SA, Pomorski Bank Kredytowy SA and Bank Depozytowo-Kredytowy SA, in 1996 even if they were merged and floated as one group.
"At this point it is hard to imagine that all nine banks could be privatized by the end of next year," Kolodko told a news conference. "First of all there is a demand barrier," he added.
Poland set the 1996 deadline in a privatization plan in 1991, when it asked seven Western governments to support the scheme with about $700 million in capital to help the banks clean up their bad debt portfolios. But Kolodko said that as the schedule could not be kept, Poland would discuss with the United States and other donor countries a possible change of the deadline.
"We will talk with the participants of the fund about a new deadline of the completion of the privatization (of the banks)," Kolodko said.
Finance Ministry officials said the program got seriously delayed after a controversial sale of Bank Slaski early in 1994, when the government and the bank's officials drew fire for underpricing and mismanaging the issue. The next privatization, of Bank Przemyslowo-Handlowy, came off only in January 1995 when bearish market sentiment forced underwriters to take up almost 40% of the 50% public offer.
Jaroslaw Biernacki, head of the ministry's banking department, earlier said banking privatizations were increasingly difficult because the market had become saturated with banks.
"Banks now account for 40% of the Warsaw bourse's capitalization and it is not easy to place several financial institutions over a short period either on the domestic or foreign markets," he said.
