BPH PBK on the edge of becoming the number two bank

According to well-informed sources in daily Parkiet, bank BPH PBK is working on a strategy to take over BRE Bank. If this is followed through it would make it the second biggest bank. BPH PBK did not want to comment on the rumors, but analysts believe such an acquisition is possible. BRE Bank has lately been in a weak position, incurring heavy losses on bad investments. Analysts have scaled down anticipated 2002 profits for BRE Bank by 50%, and the bank's shares have fallen below their book value. A takeover could arise out of a settlement between Bayerische Hypound Vereinsbank (which controls 71% of BPH PBK shares) and Commerzbank which could sell 50% of its stake. BRE Bank shares were worth zl 150 per each, but according to Grzegorz Zawada an analyst with Erste Securities, they are now down to zl. 120 to zl. 130. Analysts believe there is room for only four or five major players on the market. "The eventual merger of BPH PBK and BRE could make sense, as in the banking sector there is room for consolidation," says Artur Szeski, an analyst with the CDM Pekao brokerage house. (Parkiet, p. 1) A.L.