Laiki Bank has agreed to pay EUR 70 mln to acquire a majority stake in the Serb based Centrobanka, in a deal that includes a commitment to increase the share capital by EUR 30 mln, according to Reuters quoting Centrobanka sources in Belgrade.
The statement comes in sharp conflict of an official statement made by Laiki Bank on the CSE on Tuesday, in which it stated that it would acquire majority control by paying between EUR 38 mln to EUR 45 mln.
“With the full consent of the shareholders of Centrobanka, Laiki Bank has acquired a stake in excess of 76% of the share capital (of Centrobanka), the Serbian Bank said in its statement, adding that the price tag amounts to EUR 70 mln in total.
By the end of September, the share capital of Centrobanka amounted to USD 14.8 mln and its assets at USD 96.6 mln.
“The transaction stipulates the irrevocable commitment to increase the share capital by EUR 30 mln, of which EUR 20 mln will be paid by Laiki and the remaining EUR 10 mln by the European Bank for Reconstruction and Development -EBRD-,” Centrobanka sources told Reuters.
Laiki, in which HSBC has a 22% stake maintains a representative office in Belgrade. Centrobanka a.d. is based in Belgrade and has 5 branches, 3 business Units and 22 sub-branches. It has a market share of 1.6% in deposits and 1.4% in advances.
The acquisition is subject to the respective approvals of the Central Bank of Cyprus and the National Bank of Serbia.
The expansion of Laiki Group in Serbia is an important step in the emerging Balkan region and marks an important variation in the strategy that Laiki Group has maintained thus far, that is to expand with full banking operations only in countries where there are sizable Greek and Cypriot communities.
Laiki Group believes that the expansion in Serbia will contribute positively to the operations of the Group creating thus additional value to its shareholders.
Centrobanka’s contribution to CPB’s Net Profit for FY04 stands at 3.5%, according to Egnatia Financial Services. According to Centrobanka’s P&L account its Net profit for FY04 stood at CYP 750.000.
Analysts broadly ignored the fact that senior officials of Centrobanka were charged and convicted in 2002 for setting up 586 dummy corporations, which were used for money laundering operations. Laiki sources insisted that the bank has been cleaned of all past irregularities, pointing that in 2004 alone, revenue jumped 46% compared to 2003 and the Bank has received a clean-bill of health from the Central Bank of Serbia.
