Qatari bank to buy Turkish institution for $2.95b

Qatar's QNB acquires stake in Finansbank

Qatar National Bank is paying $2.95 billion to take over a Turkish lender

Dana Christensen | 24 December, 2015, 04:09

Finansbank has a strong capital base with a capital adequacy ratio of 15.9 percent, which is among the highest in the Turkish banking sector, together with solid long-term foreign currency ratings of Ba2 and BBB- by Moody's and Fitch, which are a testament to Finansbank's successful business, operating model and risk management.

Qatar's largest financial institution QNB is acquiring the entire 99.81% stake of National Bank of Greece in Turkey's Finansbank for 2.94bn as part of its "inorganic expansion" to become an icon in the Middle East and Africa (Mea) region.

Deal-hungry QNB, half-owned by Qatar's sovereign wealth fund, has previously set out ambitions to become the largest bank in the Middle East and Africa by 2017.

NBG bought Finansbank for the equivalent of $5 billion in 2006 in what was then Turkey's biggest-ever banking deal.

Finansbank is the fifth largest privately owned universal bank by total assets, customer deposits and loans in the Turkish market.

NBG's plan initially was to lower its holding in the bank to only 60% through a share offering, but faced many delays amidst turbulent elections that shook the capital markets in Greece as well as Turkey.

NBG, 40 percent owned by the country's bank rescue fund, said the sale price implied a price-to-tangible book value of around 1, representing a premium to average market value of Turkish banks. It will allow the Greek bank to pay back bonds held by the state and to pay down emergency lending provided by the ECB. The closing of the transaction, which is subject to regulatory approvals and other customary closing conditions, is expected to be complete in the first half of 2016, Qatar National Bank said.

QNB Capital and J.P. Morgan are acting as joint financial advisors, while Clifford Chance is acting as lead legal counsel and Yegin ‡ifti Attorney Partnership is acting as local legal counsel for the deal, which has been approved by the board of directors of both banks and the General Council of the Hellenic Financial Stability Fund.