TEL AVIV, Sept 5 (Reuters) - Israel has sold off almost all of its remaining stake in Leumi, the country’s last bank to be fully privatised, for close to 1.9 billion shekels ($525 million).
“The era of state holdings in the banks’ shares is over,” Israel’s Accountant General Rony Hizkiyahu said in a statement on Wednesday.
The state bought up nearly all the shares of Israel’s banks after a crisis in 1983 but the other top lenders — Hapoalim , Israel Discount, Mizrahi-Tefahot and First International — have been fully privatised.
The government said it had sold 5.37 percent of Leumi, Israel’s second-largest bank, to Citigroup, which had outbid five other financial institutions in a tender on Tuesday.
It retained a 0.5 percent stake in Leumi, which has a market value of 36 billion shekels, for sale to the bank’s employees.
The Finance Ministry said Citigroup had paid 23.38 shekels per share, a 1.43 percent discount to Tuesday’s closing price but 33 percent higher than the price the state received when it sold another 5 percent of its holding in 2011.
Proceeds from the latest sale would go towards financing the state’s budget deficit in 2018 and to lower the debt burden, the ministry said.
Citigroup is expected to sell the shares on to its clients. ($1 = 3.6186 shekels) (Reporting by Steven Scheer Editing by Alexander Smith)