BNP Paribas will take over Rabobank Groep’s Dutch bank’s 98.5 percent stake in agricultural lender Bank Gospodarki Zywnosciowej SA, Utrecht. According to news, BNP is not wasting any time and said that the purchase will add to earnings per share right away.
In a phone interview courtesy of Bloomberg, Pawel Kozub, an analyst at UniCredit SpA in Warsaw mentioned that “Both banks fit each other as BGZ has a strong presence in agribusiness and private banking, while BNP in Poland specializes in retail and corporate businesses.” The expert also mentioned that the impact will depend on “how deep the restructuring of the new entity will be.” This assessment was based on the reality that neither of the two banks has shown amazing performances in Poland so far.
BGZ, as Rabobank’s local unit had assets of 35.8 billion zloty at the end of September. Its nine-month net income on the other hand has increased from 73 percent to 134.3 million zloty from a year earlier. BNP’s Warsaw-based unit is the country’s 12th-largest bank and has over 21.1 billion zloty of assets.
BNP Paribas Chief Executive Officer Jean-Laurent Bonnafe mentioned in an official statement. “The acquisition of Bank BGZ constitutes a major step toward attaining a critical size in Poland,” The CEO added “The transaction will establish the BNP Paribas Group as a reference player in Poland’s banking sector.” This official statement also mentioned that this takeover will cut the Paris-based firm’s core Tier 1 capital ratio. This is a measure of a bank’s financial strength. The reduction will be about 15 basis points. Rabobank on the other hand has been selling assets which is the company’s way to meet its core Tier 1 ratio to at least 14 percent by 2016 from 12.9 percent on June 30.
Apparently, it’s not only BNP Paribas had eyes for Rabobank. Sources reveal that Italy’s UniCredit SpA and Santander SA said they were also bidding for Rabobank’s unit.
About BNP Paribas:
BNP Paribas is a financial institution that is known in over 80 countries with 190,000 employees, including 145,000 in Europe. It is very active in the following financial activities: Retail Banking, Investment Solutions and Corporate & Investment Banking. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. Soon BNP Baribas plans to engage in retail banking across Mediterranean basin countries, in Turkey, in Eastern Europe and as well as a large network in the western part of the United States. In its Corporate & Investment Banking and Investment Solutions activities, is very stimulating in Europe, in the Americas and in the Asia-Pacific. BNP Paribas stock market evolution:
About Jean-Laurent Bonnafe:
Mr. Jean-Laurent Bonnafé has been the Chief Executive Officer at BNP Paribas SA at BNP Paribas India Holding Private Limited since December 1, 2011. Mr. Bonnafé has been a Director of BNP Paribas SA since May 12, 2010. He served as a Director of Banca Nazionale del Lavoro SPA since May 2009. An Engineering graduate of the École Polytechnique and École des Mines he seeks new efforts to reinvent and rejuvenate the already impeccable financial future of BNP Paribas in all regions of the world.
About Rabobank Group:
Rabobank Group is an international financial services provider operating on the basis of cooperative principles. It offers retail banking, private banking, wholesale banking, leasing and real estate services. Rabobank’s service provision focuses on treating customers fairly. Rabobank is market leader in the Netherlands and focuses internationally on strengthening its leading position as a food and agri bank. Rabobank Group has approximately 59,500 FTEs, who serves about 10 million customers in 42 countries worldwide. Rabobank stock market evolution:
About Bank BGŻ:
Bank BGŻ is a universal commercial bank in Poland. It offers services to retail and institutional clients, which includes business clients that are established in the food and agricultural sector. BGZ specializes in financing agriculture, the food industry and regional infrastructure. The focus of the Bank BGZ is the growth of its “effectiveness, strengthening its leading position in the food and agricultural sector and enriching its product offering.” The company currently has 400 branches. It also focuses in supporting small communities. It believes in supporting entities operating on the local market and offering long-term cooperation.
UniCredit is an Italian banking and financial services company. Its network spanning 50 markets in 20 countries, with more than 9,000 branches and over 148,000 employees. The company is headquartered in Rome and general management in Milan. UniCredit stock market evolution:
About Pawel Kozub:
Mr. Pawel Kozub is an equity analyst from UniCredit CAIB Poland.