WARSAW (Reuters) - Poland’s central bank has suspended reserve requirements for Idea Bank (IDE.WA) as shares in the small Polish lender fell further on Tuesday amid investor and customer concerns about the bank, which has been hit by a corruption scandal.
Shares in Idea Bank have fallen by more than 40 percent since its owner, Polish billionaire Leszek Czarnecki, alleged corruption by Poland’s financial regulator KNF last week.
Idea Bank, whose shares were down 12 percent at 1459 GMT, said in a statement that the central bank’s suspension of its 50 percent requirement would last up to the end of 2021.
Czarnecki alleges that KNF head Marek Chrzanowski asked him to hire a specific lawyer and pay him 40 million zloty ($10.58 million) in exchange for the regulator’s “support” for the billionaire’ s troubled Getin Noble Bank (GNB.WA).
Chrzanowski, who has resigned from the post, denies any wrongdoing but analysts say the allegations have sparked concern among customers of Idea Bank and the larger Getin Noble.
This prompted the central bank to make a commitment at the weekend to offer liquidity and issue a reminder that deposits are guaranteed up to 100,000 euros ($114,040).
Idea Bank and the central bank did not respond to requests for comment from Reuters on Tuesday.
The central bank’s rate-setting panel discussed the issue at its meeting on Tuesday and said it backed the decision to suspend the reserve requirement for Idea Bank.
Opposition groups have called for a parliamentary inquiry into the allegations, but the eurosceptic Law and Justice (PiS) government says ongoing probes by prosecutors and anti-corruption officials are sufficient.
The central bank has supported Chrzanowski, with bank head Adam Glapinski, a close friend of PiS chief Jaroslaw Kaczynski, saying last Friday the regulator was “an impeccably honest, noble, honourable, professional man”.
Reporting by Marcin Goclowski; additional reporting by Anna Koper; Editing by Alexander Smith