The worst is now behind for banks, but they still need to cut costs

Banks will not look back on the past year with nostalgia. Slow economic growth compelled them to create considerable reserves in order to cover bad loans say Reuters analysts. In their opinion, this year banks will have to focus on reducing costs. Pekao, the largest publicly listed bank in Eastern Europe is planning to cut employment by about 4%, while last week president of Kredyt Bank Stanislaw Pacuk stepped down from his office. At the same time smaller banks, including Millenium and BOS, have posted poor Q3 results and similar results are expected from the majority of banks to be announced this week. Analysts say that the worst is now behind, but hardly anyone is counting on a rapid revival. For the time being markets are speculating on the size of losses that BRE Bank will post for 2002, which will reach at least zl. 100 million. (Gazeta Finansowa, Feb. 1-7, p. 9) A.Z.