Polish shares plunged two weeks ago when Marek Chrzanowski, the head of financial regulator KNF, resigned, after Getin Noble Bank owner Leszek Czarnecki accused him of suggesting KNF could support Getin if it hired a lawyer he recommended.

Worries that the scandal could hurt the banking system have eased since then, and Polish equities got additional support from legislation to reverse legal changes concerning the Supreme Court that the European Union had condemned.

Both Warsaw's blue-chip stock index and the index of its listed bank shares rose 1.2 percent by 1008 GMT. Other Central European indices were little changed.

Getin Noble shares were almost 3 percent higher after the troubled bank reported its third-quarter net loss shrank compared with a year ago.

After falling to a fifth of its end-2007 value by the peak of the scandal, the stock has gained almost 25 percent in the past two weeks.

Deposit outflows from the bank has returned to normal levels before the scandal, and Czarnecki had not withdrawn his earlier promise to increase the bank's capital, Getin Noble CEO Artur Klimczak told a news conference on Wednesday.

Budapest's main stock index, meanwhile, dropped 0.2 percent, giving up some of the past week's gains, which had pushed it to a 10-month high by Tuesday.

The pressure on Central European markets from the conflict between Russia and Ukraine over a naval incident remained limited. Senior European politicians had raised the possibility of new sanctions against Moscow.

"People mostly think that there will be no escalation which would lead to additional sanctions," said Noemi Holecz, chief analyst of Equilor Brokerage in Budapest.

The region's currencies remained range-bound and government bond yields changed little. An early weakening of the euro in its closely watched dollar cross stalled.

Federal Reserve Chair Jerome Powell's comments later on Wednesday will be watched, but he is due to speak after Central European markets close, dealers said.

"What they have said so far (concerning interest rate prospects), have been mixed, but yes, the comments can have an impact," one Budapest-based fixed income trader said.

Expectations for fewer Fed rate hikes make Central European assets more attractive.