Poland's Getin Holding has stepped up its banking presence in neighbouring
Belarus, despite the virtually frozen relations between the governments of the
two countries, with the acquisition of Belarusian Bank for Small Business
(BBSB).
On October 18, Getin announced its acquisition of 95.5% of BBSB’s shares for $4.9m from a team of multilateral investors, among which were the European Bank for Reconstruction and Development (EBRD) and the World Bank's International Finance Corporation (IFC). Each of them controlled a 21.67% stake in the Belarusian lender.
Oleg Andreyev, managing director of investment banking at Minsk-based company EnterInvest, tells bne that following its 2008 acquisition of Sombelbank (now rebranded Idea Bank), Getin was looking to buy another bank in Belarus that had a regional network, a transparent structure of owners and at a reasonable price. “BBSB fulfils all these requirements. Moreover, this Belarusian lender has a wide client base among private entrepreneurs,” Andreyev says.
Getin’s move comes after it failed last year in its efforts to acquire Paritetbank, the smallest of the four state-owned Belarusian banks, due to a disagreement over the asset’s value. Getin, controlled by Polish businessman Leszek Czarniecki, owns financial firms across Central and Eastern Europe – in Poland, Romania, Russia, Belarus and Ukraine.
Rafal Juszczak, Getin’s president, said earlier this year when it emerged that Getin was in the running for BBSB the aim of any transaction would be to target the growing loan demand from Belarusian small and medium-sized enterprises (SME). “Idea Bank Belarus... was recognized as the best consumer bank in Belarus. The acquisition of the SME specialized unit will substantially strengthen the group's position in that market,” he explained.
New capital
The deal will also enable BBSB to meet the National Bank of the Republic of Belarus' more stringent requirements regarding the minimum level of regulatory capital needed by a bank operating on the local market. BBSB is required to boost its regulatory capital by about €18m by the beginning of 2015.
The EBRD currently controls a 25% stake in another Belarusian bank, RRB-Bank, which also has to boost its capital. Francis Delaey, head of the Belarusian office of EBRD, told bne in June that the multinational lender actively worked with the shareholders of BBSB and RRB-Bank to ensure "a long-term sustainable solution" that takes into account the regulatory requirements and operating environment of Belarus.
That Belarusian regulator has given the green light to the acquisition of BBSB by Getin could be a sign the Belarusian government is ready to normalise relations with Poland, which have been virtually frozen since the disputed presidential elections in Belarus in December 2010.
After the election, President Alexander Lukashenko accused Germany and Poland of aiding in the preparation of a coup d’etat in Belarus. "We have evidence that the special services of Poland and Germany were involved," he said in March 2011, commenting on the post-election mayhem that saw clashes between riot police and opposition activists after the result gave Lukashenko almost 80% of the vote.
This spat quickly snowballed into a full-scale diplomatic break between Belarus and the EU, which had a knock-on effect on investors, such as Poland’s Kulczyk Holding refusing to build a coal-fired power plant in Belarus for approximately €1.5bn. “Such big projects need to be carried out with banks. Given the current climate surrounding Belarus it would be hard to finance such a project,” Jan Kulczyk, the Polish billionaire, explained at the time.
On October 18, Getin announced its acquisition of 95.5% of BBSB’s shares for $4.9m from a team of multilateral investors, among which were the European Bank for Reconstruction and Development (EBRD) and the World Bank's International Finance Corporation (IFC). Each of them controlled a 21.67% stake in the Belarusian lender.
Oleg Andreyev, managing director of investment banking at Minsk-based company EnterInvest, tells bne that following its 2008 acquisition of Sombelbank (now rebranded Idea Bank), Getin was looking to buy another bank in Belarus that had a regional network, a transparent structure of owners and at a reasonable price. “BBSB fulfils all these requirements. Moreover, this Belarusian lender has a wide client base among private entrepreneurs,” Andreyev says.
Getin’s move comes after it failed last year in its efforts to acquire Paritetbank, the smallest of the four state-owned Belarusian banks, due to a disagreement over the asset’s value. Getin, controlled by Polish businessman Leszek Czarniecki, owns financial firms across Central and Eastern Europe – in Poland, Romania, Russia, Belarus and Ukraine.
Rafal Juszczak, Getin’s president, said earlier this year when it emerged that Getin was in the running for BBSB the aim of any transaction would be to target the growing loan demand from Belarusian small and medium-sized enterprises (SME). “Idea Bank Belarus... was recognized as the best consumer bank in Belarus. The acquisition of the SME specialized unit will substantially strengthen the group's position in that market,” he explained.
New capital
The deal will also enable BBSB to meet the National Bank of the Republic of Belarus' more stringent requirements regarding the minimum level of regulatory capital needed by a bank operating on the local market. BBSB is required to boost its regulatory capital by about €18m by the beginning of 2015.
The EBRD currently controls a 25% stake in another Belarusian bank, RRB-Bank, which also has to boost its capital. Francis Delaey, head of the Belarusian office of EBRD, told bne in June that the multinational lender actively worked with the shareholders of BBSB and RRB-Bank to ensure "a long-term sustainable solution" that takes into account the regulatory requirements and operating environment of Belarus.
That Belarusian regulator has given the green light to the acquisition of BBSB by Getin could be a sign the Belarusian government is ready to normalise relations with Poland, which have been virtually frozen since the disputed presidential elections in Belarus in December 2010.
After the election, President Alexander Lukashenko accused Germany and Poland of aiding in the preparation of a coup d’etat in Belarus. "We have evidence that the special services of Poland and Germany were involved," he said in March 2011, commenting on the post-election mayhem that saw clashes between riot police and opposition activists after the result gave Lukashenko almost 80% of the vote.
This spat quickly snowballed into a full-scale diplomatic break between Belarus and the EU, which had a knock-on effect on investors, such as Poland’s Kulczyk Holding refusing to build a coal-fired power plant in Belarus for approximately €1.5bn. “Such big projects need to be carried out with banks. Given the current climate surrounding Belarus it would be hard to finance such a project,” Jan Kulczyk, the Polish billionaire, explained at the time.
No comments:
Post a Comment