18 July 2019
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  • 11:46 Abanka sale completes privatisation of Slovenia’s largest banks
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Slovenia’s daily Delo reports that Slovenian Sovereign Holding (SSH) announced in June that the most favourable bid for the purchase of 100% of shares of Abanka was submitted by the Nova kreditna banka Maribor (NKBM), which is owned by the American investment fund Apollo.

According to unofficial information published by Slovenian media, SSH decided to accept NKBM’s bid because it offered better terms for the purchase of Slovenia’s third largest bank, although its offer was approximately at the level of the Hungarian OTP Bank which was also in the final choice.

According to unofficial information by the daily Finance, after receiving all licenses, NKBM will pay EUR 444m for Abanka.

The Slovenian state received EUR 512m from Abanka this year, alongisde the 66.7m EUR of the dividend it received in mid-May. The unaudited book value of the Abanka share at the end of March stood at EUR 39.92. Accordingly, the total book value of the entire bank amounted to about EUR 602.8 million, according to Croatia’s Poslovni dnevnik.

The highest book value of Abanka was at the end of the first quarter of 2017 – the best time to sell the bank – Finance writes.

Marjan Šarec’s government expressed satisfaction that the privatisation of Abanka, as well as the privatisation of the country’s largest bank, NLB bank, was completed, thus fulfilling Slovenia’s obligations to the European Commission to privatise state banks after providing budget funds in 2013 to bail out the banks due to bad credit placements.

In the first quarter of this year, Abanka achieved EUR 18.6 million net profit, which is 27% less than in the same period last year. Abanka’s share in the Slovenian banking market, measured by the size of the balance sheet total (EUR 3.8 billion), was 9.6%.

SSH announced that it sold 10% of Nova Ljubljanska Banka (NLB) to institutional investors for a total of EUR 109.5 million on behalf of the state. This ended the privatisation of the largest Slovenian bank, in accordance with Slovenia’s obligtaions to privatise the largest state-owned banks.

The completion of the two privatisation procedures means that the European Central Bank (ECB) restrictions on both banks will be lifted.

NLB chairman Blaž Brodnjak said that NLB “will be able to more actively seek opportunities to strengthen its position as a systemic player on our markets”.

A merger between Abanka and NKBM would create a bank with combined assets of EUR 8.71bn or a 22.5% market share. NLB’s total assets amount to EUR 8.81bn.

This puts the US private equity fund Apollo, owner of 80% of NKBM, in prime position to shake up the Slovenian banking system, having already led the consolidation by integrating two smaller banks into NKBM since it bought the bank from the state in 2015, STA reports.

The original article was published in Delo by Maja Grgič on 20 June 2019

 

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