NBG’s Finansbank mulls 1 bln lira bond issue in Turkey

Finansbank >, the Turkish lender owned by National Bank of Greece (NBG), may issue a 1 bln lira bond ($670 mln) after its planned public offering, Finansbank's chairman told Reuters.
Seeking to boost its balance sheet in the wake of the Greek debt crisis earlier this year, NBG, Greece's largest lender plans to sell off up to 20% and retain a 75% stake in the Turkish bank.
"After the public offering we can hold a 1 bln lira bond issue," Omer Aras said in an interview.
NBG, which has said it aims to raise 2.8 bln euros ($3.86 bln), completed a 1.8 bln euro cash call through a rights issue in October.
According to Aras, NBG had expected the Finansbank offering could raise a billion euros. Half the proceeds from the sale will go to NBG and half to Finansbank, Aras said.
Turkish banks have been relatively unscathed by the global financial woes as a result of stringent policies imposed after a 2001 Turkish crisis.
Aras said NBG was not launching an exit strategy from Finansbank and said that its management would not change after the sale.
The public offering was targeted for the first half of February but could be delayed until the second quarter because of continuing market volatility in Europe, Aras said.
"But the situation which Turkey is in and the policies it is implementing point to strong capital markets," he said.
NBG has picked Credit Suisse, Deutsche Bank, Morgan Stanley, Merrill Lynch, Goldman Sachs and HSBC for the share placement.
The domestic roadshow will be conducted by a consortium led by Finansinvest. The domestic and overseas sales would be simultaneous, Aras said.
NBG bought a 46% stake in Finansbank or $2.8 bln in 2006 and subsequently increased its stake.
Finansbank last month reported a 10.3% fall in net profit to 559.7 mln lira for the first nine months of 2010.
Aras said loan growth in the Turkish banking sector could be around 22% in 2011, compared with some 27-28% seen this year.