According to Polish daily Rzeczpospolita, the Insurance and Pension Funds Supervisory Commission is meeting today and will most likely take a negative decision on allowing PTE PZU to merge with PTE Skarbiec (BRE Bank’s subsidiary).
Our view: A negative decision would be bad news for BRE Bank and, though it may be anticipated by the market, a negative trading impact should be expected. The results of PTE Skarbiec (2.7% market share in 1H06) have been poor and the business has been for sale since the beginning of 2005.