KBC Groep NV (KBC), Belgium’s biggest bank and insurer by market value, agreed to sell its stake in Nova Ljubljanska Banka d.d. to the Republic of Slovenia while missing a European Union deadline for other disposals.
KBC will sell its remaining 22 percent stake of Slovenia’s biggest lender for 2.8 million euros ($3.7 million), or 1 euro per share, the Brussels-based company said in a statement on its website today. It had purchased 34 percent for 435 million euros in 2002. EU regulators will appoint a trustee to oversee the divestment of Antwerp Diamond Bank and KBC Bank Deutschland after KBC didn’t meet a disposal deadline, it said.
KBC has cut risk-weighted assets by at least 32 percent since the end of 2008 and sold more than 20 entities as part of a disposal program agreed with EU regulators in exchange for approval of state aid. The bank earlier this week agreed to sell it’s Russian Absolut Bank for 1 billion euros.
KBC shares fell 1 percent to 25.98 euros at 9:49 a.m. in Brussels. They have gained 166 percent this year.
For four remaining divestments, the Belgian company is “maintaining an open and constructive dialogue with the European Commission,” it said. KBC had planned to sign divestment agreements in Poland, Germany, Belgium and Serbia by the end of this year.
The disposal of Kredyt Bank (KRB) in Poland “remains on track” after the commission extended the deadline, Chief Executive Officer Johan Thijs said in the statement. KBC is negotiating with a number of bidders on a sale of KBC Banka in Serbia, for which it also won a deadline extension to complete the process.
“In view of the ongoing turbulent climate on the financial markets, the acquisition of Antwerp Diamond Bank and KBC Bank Deutschland by external strategic investors is more challenging,” Thijs said. “KBC will continue to explore further divestment possibilities for them in close collaboration with a divestiture trustee, as provided for under the agreement with the European Commission.”
The sale of the stake in Nova Ljubljanska Banka, or NLB, which is expected to be completed in early 2013, will lead to a 100 million-euro charge in the fourth quarter, KBC said.
“The purchase of the stake is interesting for Slovenia because it will now be able to lead a more effective process of seeking a new long-term strategic partner for NLB,” the Finance Ministry in Ljubljana said in an e-mailed statement today.
Slovenia, the first post-communist nation to adopt the euro, is ready to sell its entire stake in Nova Ljubljanska, Finance Minister Janez Sustersic has said as the government seeks to reduce its role in the financial industry and make it more attractive to foreign investors. Slovenia will indirectly own 84 percent of its biggest bank after the transaction.
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