Poland has finally reached a compromise with Italian bank UniCredito on a controversial cross-border takeover that put Warsaw's new government at loggerheads with the European Union's executive.
But the belated agreement may not be enough to save Poland from court action over its opposition to the original terms of a deal that the European Commission approved last October.
When UniCredito bought HVB last autumn, it took control of the German bank's Polish arm, BPH, and intended to merge it with its own Polish operation, Pekao.
But after taking power last November, Poland's new government complained that the merger of the nation's second and third-largest lenders would damage competition in the banking sector and threaten jobs - a crucial factor in a country with 18 percent unemployment, the highest in the EU.
Under the deal finalised this week, UniCredito pledged to sell 200 branches of BPH and relinquish the BPH brand, and not to cut any jobs for two years at the Pekao and BPH offices it retains.
"We are happy to reach this agreement," said Polish treasury minister Wojciech Jasinski after signing the deal in Warsaw with UniCredito officials. "I hope the accord signed will be advantageous for both banks, Pekao just as much as BPH." In a statement, the treasury ministry said the deal obliged UniCredito to complete the merger and the divestment of 200 branches within 30 months.
"This will benefit all our customers, employees, the community and shareholders," said UniCredito's Andrea Moneta.
"We are very happy that we can work in Poland. We believe in the potential of this market and we are convinced that together we can do a great job." The warm words came after months of wrangling over the deal, which led many analysts to criticise the government for damaging investor confidence in Poland.
When the compromise deal was outlined recently, prime minister Kazimierz Marcinkiewicz insisted it proved that Poland was a good place to do business.
"What does this deal mean? It means it is worth investing in Poland and, as you can see, all investors leave Poland happy," Mr Marcinkiewicz said.
"It is good for Pekao, which will in the long term become Poland's biggest bank," he added. "And it's also good for BPH, which will retain a presence on the Polish market." But the European Union said at the time the deal might not avert court action against Poland, which has been lambasted in recent weeks for its "economic nationalism".
"An agreement does not necessarily mean an end to proceedings for violating Article 21, which gives the European Commission exclusive rights to authorise or block EU cross-border mergers," said commission spokesman Jonathan Todd.
