PZU bids for Raiffeisen Polbank below book value - Reuters

Poland's and CEE's largest insurer PZU has submitted an offer to purchase Polish unit of Raiffeisen Bank International (RBI) which is worth below its book value, Reuters reported on Friday. RBI needs to sell its Polish arm Raiffeisen Polbank, with a book value of PLN 6 billion so that it will be able to "shrink its balance sheet and hit a core capital ratio of 12 percent by end-2017", the agency pointed out. Reuters informed earlier this month that PZU was interested in buying the Polish lender in order to build its own banking business as it had secured an over 25 percent stake in Alior Bank. "PZU's offer is below book value. They have overpaid for Alior, so the maths in their business model would not work otherwise," an anonymous source told Reuters. "It all depends on what one sees as book value. PZU has said that it would not buy a bank together with a portfolio of Swiss franc-denominated mortgages. When you include the franc then yes, PZU is bidding below book value," another source said. Both companies declined to comment.