MFDnes newspaper has published a list of members of the new KB board of directors (BoD), which is to be appointed following the bank’s EGM on October 8. The new BoD will have five members (vs. current seven), and will be composed of three Societe Generale representatives (including the chairman) and two current board members (P. Palecka, T. Spurny). Notably, Radovan Vavra, the current BoD chairman and CEO, is not to be included on the new board. Societe Generale is reportedly concerned about KB’s CZK 17 bil. investment in debt derivatives made in the pursuit of a higher yield. (We expect that the investment will result in additional provisioning in Q3, which should appear in the 9M results due at the end of October.) The news of the planned board changes is neutral for the stock.
(Ondrej Datka)