PZU Appoints BofA Banker as CEO of Poland's Largest Insurer

  • Insurer faces pressure on earnings from new tax, lower income
  • Shares in the company have dropped 5.6 percent this year

PZU SA appointed Michal Krupinski, an executive at Bank of America Inc. and former deputy treasury minister, as chief executive officer of Poland’s largest insurer, in the latest change as Poland’s new government extends its influence over the economy.

Krupinski, 34, takes over the post as the state-controlled company faces challenges including lower income from investments and a new tax on its assets. PZU’s shares have fallen 5.6 percent this year, extending a 30 percent decline in 2015.

Krupinski’s appointment is part of a shake-up at state institutions and government-controlled companies as Polish Prime Minister Beata Szydlo seeks to extend the influence of her Law & Justice party after winning parliamentary elections last year. Krupinski will replace Andrzej Klesyk, who resigned in December after failing to secure government support. The country’s biggest utilities, Energa SA and Enea SA, as well the largest refiner, PKN Orlen SA, whose biggest shareholder is the state, have also dismissed their CEOs.

PZU last year bought a stake in Alior Bank SA as part of a strategy to diversify into the banking industry, just as Szydlo’s election victory heralded trouble for Polish banks. Following Hungary’s example, Poland moved to convert foreign-currency mortgages into zloty and imposed a levy on lenders and insurers that will drain them of 4.4 billion zloty ($1.1 billion), or a third of last year’s profits, according to government estimates.

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