S&P: banking sector consolidation still possible

Polish banking sector might see further consolidation, according to S&P analyst Michał Selbka, but the potential merging of PKO BP and Pekao is unlikely and could hurt competition. “It is probable that a part of the banking sector in Poland will be further consolidated. I would not like to mention specific entities, however, because decisions depend on banks' strategies. The merger of the two largest banks in Poland - PKO BP and Pekao, is unlikely in my opinion. If the merger would take place, it would increase the concentration and probably sharp concentration and probably lower the competitiveness in the banking system,” said Selbka. “Currently, the concentration on the banking market in Poland is still low, compared to other CEE countries, or some western markets. However, if we would include in this concentration a state entity that directly or indirectly controls about 40 percent of the market (assets and deposits), which most statistics do not take into account, this concentration would look differently,” he added.