The Bank Customers Who Belong to the BankNarrow moat

PZU owns Bank Pekao and Alior Bank, which between them serve millions of Polish retail customers. That is the most valuable distribution channel in the group, and PZU does not own the customer relationships inside it.

The bank does. The bank holds the current account, sees the salary arriving and the mortgage being paid, employs the adviser the customer trusts, and decides what gets offered at the counter and in the app. PZU supplies a product. The arrangement works — insurance sold alongside a mortgage or a loan converts far better than insurance sold cold — but it works through an intermediary whose own management, incentives and regulator are separate from the insurer's, even when the shares are held in the same group.

Elsewhere in this collection the same structure appears with a different label: McDonald's selling to franchisees, Coca-Cola to bottlers, an exchange to member brokers. In each case the intermediary supplies reach that would take a decade to build, and takes ownership of the customer as its price. What distinguishes PZU's version is that it paid for the intermediary, at the direction of a state shareholder, in transactions the moat's own Bank Pekao and Alior pages examine.

The Pekao merger is, among other things, an attempt to settle this. A single combined banking and insurance group¹ can build one customer view, one set of incentives and one product shelf, instead of a shareholding and a distribution agreement. That is the genuine industrial logic behind a deal usually discussed in terms of released capital.

The number to watch is insurance premium written through the bank channel per banking customer. It is the only figure that shows whether owning a bank is producing insurance sales or merely producing a bank.