Apr 05 2012 |
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EXCLUSIVE: Four financial institutions in fray for Piraeus Bank Egypt
By Mohamed El Agamy Four international financial institutions are in the fray to acquire Piraeus Bank Egypt after Standard Chartered ended takeover talks in November last year, a person close to the discussions said. The Egyptian lender is 95.4% owned by its Greek parent, Piraeus Bank Group.Three of these institutions are currently conducting a due diligence process on the Egyptian subsidiary's assets and liabilities and its loan portfolio, the person told Zawya. One more institution will begin its evaluation next week, the person said, without revealing the names of the suitors.
Athens-based Piraeus Bank Group acquired Egyptian Commercial Bank in June 2005 and renamed it Piraeus Bank Egypt . It has about 50 branches in the North African nation.
The sale of Piraeus Bank Egypt is part of the group's efforts to strengthen its capital base.
" Piraeus Bank Group's decision to offload its Egyptian subsidiary is a result of the sovereign debt crisis in Greece and the need to strengthen the group's capital base," Ashraf Reda, former vice chairman of Citibank in Egypt, told Zawya. "It's essential to provide liquidity."
The Athens-based group reported a net loss of EUR 345.2 million for the third quarter of 2011 and a total net loss of EUR 353.5 million, including its Egyptian operations, according to a Zawya Dow Jones report late last year.
According to Piraeus Bank Egypt 's financial statements, during the first nine months of 2011, the value of assets dropped to EGP 9 billion compared to EGP 11.3 billion in the same period of 2010. Loans stood at EGP 3.5 billion compared to EGP 3.9 billion. Deposits deteriorated from EGP 10.2 billion to EGP 8.2 billion.
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