Erste will fund the all-cash purchase entirely with "internal resources", by cancelling its planned €700m share buyback.

Erste Group Bank AG agreed to buy much of Banco Santander SA’s operations in Poland for about €7 billion ($7.9 billion), marking its largest deal ever.

Austria's Erste Group Bank acquired a 49% stake in Santander's Polish unit for around 6.8 billion euros ($7.7 billion), Santander and Erste said on Monday, driving shares in Santander Bank Polska down around 5% in Warsaw.