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UPDATE 1-Greece's National Bank sells Serbian unit to Hungary's OTP Bank
August 4, 2017 / 4:16 PM / 3 months ago

UPDATE 1-Greece's National Bank sells Serbian unit to Hungary's OTP Bank

(Adds details, background)

Aug 4 (Reuters) - Greece’s second-largest lender National Bank said on Friday it is to sell its wholly-owned Serbian operations to OTP Serbia, a subsidiary of Hungary’s OTP Bank, as part of a restructuring plan agreed with European regulators.

Like other big Greek banks, National Bank (NBG) has been slimming down by divesting assets and foreign subsidiaries to focus on banking at home, with proceeds boosting capital ratios and liquidity.

NBG valued the sale at 125 million euros ($147 million) which includes Vojvodjanska Banka, NBG Leasing and a portfolio of Serbian-risk corporate loans.

The sale of NBG’s Serbian assets, agreed at a multiple of about 0.75 times tangible book value, will increase the Greek lender’s core equity Tier-1 capital adequacy ratio by about 0.3 percentage points.

Taking into account the repayment of intra-group debt, the divestment will also strengthen NBG’s liquidity by 280 million euros, it said.

NBG’s chief executive, Leonidas Fragiadakis, told Reuters last month that National Bank would sell its operations in Romania, Serbia and Cyprus to complete a restructuring plan agreed with EU bank regulators.

“After over 15 years of successful presence in Serbia, NBG divests its operations to deliver on commitments to European authorities,” he said in a statement on Friday.

“The transaction allows for the redeployment of resources to support Greece’s economic recovery,” he added.

The deal is subject to the approval of the central banks of Hungary, Serbia, and the Hellenic Financial Stability Fund, Greece’s bank rescue fund which owns 40 percent of NBG.

Last month OTP Bank agreed to buy NBG’s Romanian subsidiary Banca Romaneasca, a bank with a network of 109 branches. (Reporting by Lefteris Papadimas and George Georgiopoulos; Editing by Greg Mahlich)

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