Ljubljana – The Hungarian OTP Bank Group announced on Monday it had signed a contract to acquire the outright stake in NKBM, Slovenia’s second largest bank. The deal is expected to be finalised in the second quarter of next year as the acquirer is waiting approval from relevant regulatory authorities.
Owned by the US fund Apollo (80%) and the European Bank for Reconstruction and Development (20%), NKBM controls 20.5% of the Slovenian market and is the second largest bank in the country.
OTP already owns SKB Banka, which it acquired from France’s Societe Generale for EUR 323 million under an agreement signed in 2019.
Combined with NKBM, the new bank would control some 29% of the market measured by total assets to leapfrog the current market leader, NLB.
The price of the NKBM acquisition remains confidential. The Reuters news agency reported in April that it could be worth nearly a billion euro.
OTP was an early favourite to acquire NKBM, though the business newspaper Finance, which first reported today about the deal, says several other bidders expressed interest as well, among them Erste Group from Austria and Belgium’s KBC.
NKBM was sold to Apollo and the EBRD in 2016 for EUR 250 million, and NKBM purchased the Abanka bank in mid-2019 for EUR 444 million, when the OTP Bank Group was also in play to buy Abanka.
NKBM and Abanka were among the banks that the state bailed out at the end of 2013 and beginning of 2014 after difficulties brought about by the economic and financial crisis.
Slovenia promised to the European Commission, in return to approval of state aid, that it will privatise the banks. In the case of Abanka, the condition was also that it is merged with the Banka Celje bank before privatisation.
NKBM ended 2020 with a net profit of EUR 208.9 million, and its total assets stood at EUR 9.17 billion.