PKO BP ready to fight for banking's top spot

The merger of banks Pekao SA and BPH would dethrone Poland's current biggest lender, PKO BP, from its leading position in the banking sector. With its zł.91 billion in assets, PKO BP will fall behind the new giant, whose resources are expected to reach zł.120 billion.

However, the company has come out with both barrels blazing. "We are dropping to second position but we are not going to stay there," said PKO BP's president, Andrzej Podsiadło.

At the end of last year PKO BP revealed its new strategy for 2006-2008, which, according to analysts, is an attempted response to the merger. "In the strategy, we set out to strengthen the company's position, expand in Poland and abroad, as well as change the company's  image," said Podsiadło. He stressed that after three years of modernizing and restructuring the time has come for innovation.

PKO BP wants to change its image as and old-fashioned and customer-unfriendly machine into a modern and innovative financial services provider. According to the bank's vice president, Kazimierz Małecki, the lender intends to participate more in the growth of the small and medium-sized firms sector. In addition, the bank plans to expand into the most attractive CEE markets. "These changes are not revolutionary. It seems that the bank will behave cautiously," says one financial analyst from WGI Group.

PKO BP is Poland's oldest and biggest bank. It has 1,200 posts and employs 36,000 people. The bank holds a 33-percent share in the savings market and a 34-percent share in debit-card sector.