November 16, 2018 / 3:18 PM / a month ago

UPDATE 1-Polish state banks fall on uncertainty over Getin Noble

(Adds poll numbers, quotes from central bank governor)

WARSAW, Nov 16 (Reuters) - Poland’s prime minister sought to reassure investors on Friday about the health of the banking sector following steep falls in bank share prices after the financial regulator quit this week amid corruption allegations.

By 1304 GMT shares in PKO BP were 6.6 percent lower, while shares in Bank Pekao and Alior Bank were both down by around 7 percent.

“Stress tests show ... the banking sector situation is very good,” Prime Minister Mateusz Morawiecki told reporters.

The head of the financial regulation authority, Marek Chrzanowski, stepped down on Tuesday following newspaper reports saying he had sought a multi-million dollar bribe from the owner of Getin Noble Bank, Leszek Czarnecki.

“Investors are increasingly worried. They are afraid of what could happen over the weekend with Leszek Czarnecki’s banks as an effect of this week’s events,” said Lukasz Janczak, an analyst with brokerage Ipopema.

Chrzanowski has denied any allegations of wrongdoing, the PAP news agency reported. The ruling Law and Justice (PiS) party, which nominated him to the post, said it would launch a wide-ranging investigation.

Chrzanowski has not replied to requests for comment from Reuters.

Shares in Getin, country’s ninth largest lender, were down for a third day in a row, losing 17.5 percent and taking their year-to-date losses to more than 75 percent.

Shares in another bank owned by Czarnecki, Idea Bank , lost 16 percent, while shares in another of his financial companies, Open Finance, shed 7 percent.

“It’s foreign investors who are responsible for the falls,” said Maciej Marcinowski, an analyst with brokerage firm Trigon.

Poland’s central bank governor Adam Glapinski said on Friday he was not going to resign, commenting on a report in tabloid newspaper Fakt that top politicians were discussing his future.

Glapinski said the central bank was monitoring the situation on the interbank market and said it was stable. He also told reporters the central bank “can impose order, calm down every situation and none of the banks’ clients should be worried.”

The KNF’s acting head, Marcin Pachucki, also said the situation was stable and the regulator was ready to act if needed.

The scandal is a blow for the PiS party, which took power in Poland in 2015 partially on a pledge to fight corruption.

Poland’s Public Opinion Research Center said a poll conducted between Nov. 8 to 15 showed 42 percent of the population backed PiS, up from 40 percent in October.

Reporting by Alicja Ptak, Anna Koper, Marcin Goclowski, Joanna Plucinska and Wojciech Zurawski Editing by Louise Heavens and Edmund Blair

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