Merger ensures BRE Bank's profits

BRE Bank has announced that it will merge its Skarbiec-Emerytura pension fund with PZU's Złota Jesień. The total value of the deal could be as high as zł.365 million.

Under the terms of the deal PTE PZU will take over the Skarbiec-Emerytura pension fund. BRE Bank's share of the company's capital and shareholding will be 13.1 percent. PZU Życie SA's percentage will be 86.9 percent. The total share price of BRE's investment should amount to zł.365 million, but this figure may be altered due to a percentage net change in assets between June 30, 2005 and the date of the merger.

Sławomir Lachowski, president of the board at BRE Bank, says he sees benefits of the deal for all involved. "I am convinced that the terms and conditions of the agreement are beneficial for BRE Bank and PZU Życie, but also for the pension funds and their customers. The deal will help us hit 2005 financial forecasts," he explains.

Skarbiec has about 470,000 clients with assets worth almost zł.2.4 billion. PTE PZU has over 1.8 million customers and zł.11 billion worth of assets.

Once the Insurance and Pension Fund Supervision Commission and the Competition and Consumers' Protection Office give the deal the green light, the number of pension funds on the market will be reduced to 13, down from 21 in 1999. (Reuters)