Cabinet raises PKO BP's capital through equity injection

The Cabinet agreed to transfer shares from five WSE-listed companies, worth approximately zl.390 million, to PKO BP S.A. in a bid to boost the state savings bank's capital ahead of its privatization, according to a statement by the Treasury Ministry. PKO BP will acquire 5.25% of KGHM Polska Miedz, 2.23% of Bank Handlowy, 13.96% of Stalexport, 0.68% of Bank Ochrony Srodowiska and 0.01% of BRE Bank. The bank is in need of a capital boost after its capital adequacy plunged below the minimum requirement of 8% set under the Polish banking law. By the end of the third quarter this year, PKO BP's adequacy stood at 6.1% with its assets reaching almost zl.70 billion. According to Rzeczpospolita's estimates, for PKO BP's capital adequacy to reach 10%, the bank would need to increase its capital by more than zl.1 billion. (Rzeczpospolita, Dec. 2-3, p.B5, Reuters)