French investment bank Societe Generale has agreed to sell SKB Banka (Slovenia) and its subsidiaries to Hungarian banking major OTP Bank for an undisclosed price.
Image: OTP Bank to acquire SKB Banka (Slovenia). Photo: courtesy of Nyar94/Wikipedia.org.
The subsidiaries of SKB Banka to be acquired by OTP Bank are SKB Leasing and SKB Leasing Select.
SKB Banka is the fourth largest bank in Slovenia with a market share of around 9% and as a universal bank, it is engaged in both the retail and corporate segments.
Societe Generale said that the sale of the Slovenian bank is likely to have a positive impact on the group’s CET1 ratio of about seven basis points and also cut down its risk weighted assets by nearly €2.3bn.
It is also said to be in line with the refocusing strategy of the French bank, which has an objective to achieve a positive impact of + 80-90 basis points on the CET1 ratio by 2020.
The sale will also have a negative impact of €67m on the first-half 2019 results of the group owing to goodwill impairment, said Societe Generale.
The French investment bank said that Slovenia will be part of the cooperation agreement it signed with OTP Bank that covers the provision of mutual services in various fields like investment banking, capital markets, liquidity management, and financing cash among others.
Societe Generale group deputy CEO, in charge of International Retail Banking activities, Financial Services and Insurance, Philippe Heim said: “I welcome the strategic agreement reached with OTP which will allow us to continue to serve our clients in Slovenia and in many Balkan countries in various fields including investment banking, capital markets, corporate banking, cash and liquidity management.
“Societe Generale will sustain a dynamic and profitable growth in its International Retail Banking activities, leveraging on its subsidiaries in Eastern Europe, particularly in the Czech Republic and Romania, Russia and Africa.”
The transaction, which will be subject to receipt of approvals from Bank of Slovenia and European Central Bank and antitrust authorities, is expected to be completed in the coming months.
In March 2019, OTP Bank agreed to acquire 90.56% stake in Societe Generale Bank Montenegro, the Montenegrin subsidiary of Societe Generale Group, for an undisclosed price.