Greek bank Eurobank Ergasias said on November 7 that it reached an agreement to buy the Bulgarian subsidiary of fellow Greek lender Piraeus Bank for 75 million euro.
The acquisition would be done by Eurobank’s Bulgarian unit, Postbank, and is expected to close in the first quarter of 2019, subject to regulatory approvals, Eurobank said in a statement.
Piraeus Bank Bulgaria had assets of 3.14 billion leva (about 1.6 billion euro), according by Bulgarian central bank data. It operated in the retail and, mainly, corporate banking segments through a network of 70 branches and more than 900 employees, Eurobank said.
After the merger, Postbank would have assets of more than five billion euro, Eurobank said. Postbank had 8.16 billion leva in assets, or 4.17 billion euro, at the end of September, according to central bank data, meaning it would challenge Belgian KBC Group’s subsidiary, United Bulgarian Bank (UBB), for the position of the third-largest bank by assets after the merger.
The transaction would also “strengthen Postbank’s position in the Bulgarian banking sector, with a pro forma market share in excess of 10 per cent, ranking third in terms of total loans,” Eurobank said.
This is the second time Eurobank will acquire the Bulgarian subsidiary of a fellow Greek lender, having bought the branches of its domestic rival Alpha Bank in Bulgaria in 2015.
The deal will also leave Eurobank as the last Greek lender with a subsidiary in Bulgaria, a market where they had a strong presence before the euro zone crisis, but one that most Greek banks have exited in recent years, most notably the sale of UBB by National Bank of Greece to KBC Group last year.
It is also the third bank merger announced in Bulgaria this year, after the sale of small Victoria Bank to Investbank and the planned sale of Societe Generale Expressbank to Hungary’s OTP Bank, which already owns Bulgaria’s second-largest lender Banka DSK.
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