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By Inti Landauro and Marcin Goclowski
PARIS, July 4 (Reuters) - Credit Agricole SA said on Wednesday it does not intend to sell its banking unit in Poland after two sources in Warsaw said the French bank believed it lacked the necessary size to compete with larger local players.
“We don’t plan to sell our bank in Poland,” a spokeswoman for Credit Agricole said.
The two banking industry sources had told Reuters the French bank was considering selling its Polish unit because it is too small to compete with larger players in a competitive market where low interest rates squeezed banks’ margins.
Given its relative lack of clout in the fragmented Polish banking industry, observers expect Credit Agricole to either exit or buy assets to strengthen its position. Credit Agricole’s assets in Poland amount to 33 billion zlotys ($8.75 billion), including assets of the group’s leasing firm, making it is nine times smaller than Poland’s biggest lender PKO BP.
Last month, Reuters reported that Credit Agricole was among investors interested in buying Societe Generale’s Polish unit Eurobank, which also struggles to compete with bigger players. Credit Agricole on Wednesday declined to comment on whether it was interested in buying Eurobank. The sale of those banks would underpin a broader trend of consolidation in Polish banking, which has accelerated in recent years with the ruling eurosceptic Law and Justice (PiS) party encouraging domestic ownership. The Polish state last year bought back Poland’s second largest bank Pekao SA from UniCredit, Santander then decided to buy the local assets of Deutsche Bank.
Reporting by Inti Landauro, Marcin Gloclowksi and Pawel Sobczak; Editing by Kirsten Donovan