Alior Bank takes over core Bank BPH

A big change on the Polish banking scene is on its way. Alior Bank will acquire Bank BPH, but not in its entirety. The move will cost 1.532 million PLN. The agreement sealing the deal was signed last Thursday.

Alior will take over core Bank BPH. What will not be taken over are the mortgage portfolio and assets and liabilities related to BPH TFI. In other words, the deal concerns Bank BPH’s basic activity: current and deposit accounts.

As the CEO of Alior Bank Wojciech Sobieraj notes, the takeover will cause an increase of effectiveness and will allow both companies to take advantage of synergy effects that are to bring the bank 300 million PLN a year.

In order to gather capital for the acquisition, Alior will soon emit some new shares. The number of shares to be issued has not yet been announced. PZU, the bank’s main shareholder, has already expressed will to buy the new pack of shares.

Bank BPH is currently owned by General Electric. They were looking for a buyer for some time. The takeover did not come as a surprise.

Alior is not a newcomer when it comes to takeovers. The company not so long ago merged with another smaller bank, Meritum Bank, and two Credit and Savings Unions.

The takeover will enable Alior Bank to become a big player in the Polish banking sector. The total value of its assets once the transfer is complete will be 53 billion PLN. This means the new Alior will be the ninth biggest bank in the country.

Now Alior Bank needs to face the challenges that come with the transaction. Integration cost are planned to reach 650 million PLN. Account holders will become clients of a different bank. The company needs to make sure the change is as smooth as possible.

The takeover does not mean Bank BPH will cease to exist. The bank will demerge and its core will go to Alior. However, there still remains the part of assets that Alior Bank was not interested in, namely mortgages plus investments. The new BPH, still in the hands of General Electric, will focus on these two areas. The details of the demerger have not yet been announced.

The takeover will be completed by the end of the fourth quarter of 2016.