BZ WBK takeover of Deutsche Bank Polska rating neutral - Fitch

Fitch rating agency analysts assume that the acquisition of a part of Deutsche Bank Polska will not affect the credit rating of BZ WBK, due to the small scale of transactions and the planned increase in BZ WBK's capital in connection with the acquisition. “The transaction will increase BZ WBK's gross loans, deposits, and assets under management by about 16 percent, 9 percent and, 5 percent, respectively. BZ WBK also expects to increase its market shares in loans by about 160bp and deposits by about 90bp to 11.7 percent and 11 percent, respectively. The risks for BZ WBK from the acquired portfolio are modest due to their good asset quality. The bank's impaired loans ratio of 6 percent at end-September 2017 will decrease due to the transaction by about 50bp, with provision coverage largely unchanged,” Fitch said in its report. Last week, BZ WBK signed a contract to take over part of Deutsche Bank Polska's operations, which includes retail banking, private banking, business banking and DB Securities. The preliminary price for the acquisition of assets is PLN 1.29 billion, of which 20 percent is to be paid in cash, and 80 percent in equity.