Inadequate audit of merged assets means zł. 90 million loss for Bank BPS

Bank Polskiej Spółdzielczości (BPS) has recorded a loss of around zł. 90 million in 2002. This however, was not a result of bad current operating activities, but rather an effect caused by a correction of financial data of banks which merged to form BPS, and the takeover of Dolnośląski Bank R egionalny (DBR). After carrying out an audit, it turned out that DBR has losses of zł. 92 million, with own funds of zł. 32 million and total assets of zł. 300 million. The loss was a result of very poor credit granting policy, which is now being investigated by the prosecutor. BPS is currently requesting a preferential loan from the Bank Guarantee Fund (BFG), which will help to cover the losses of the acquired DBR. During an audit for the 2002 financial year, it turned out that some of the six banks which merged last year to form BPS did not create all required reserves. (Rzeczpospolita, p. B3) A.K.