HSBC Turkey Said to Draw Local Banks' Interest as Deadline Looms

  • ING also said still to be considering offer for business
  • Final bids for unprofitable unit are said to be due this month

Fiba Holding, owned by billionaire Husnu Ozyegin, is considering a bid for HSBC Holding Plc’s unprofitable Turkish business, joining ING Groep NV in the running for the unit, four people with knowledge of the matter said.

Final bids are due early this month, the people said, asking not to be identified as the process isn’t public. Garanti Bank has also shown interest in the business, according to the people. Citigroup Inc. is advising HSBC on the sale, three people with knowledge of the matter said in July.

HSBC had been near to an agreement with Amsterdam-based ING in the summer, only for that process to stall, people familiar said in early September. The impasse prompted HSBC to re-approach Turkish banks including Garanti and Yapi Kredi to gauge their interest, people familiar said.

HSBC Chief Executive Officer Stuart Gulliver, on a conference call with analysts Monday, said there “is no update just yet” on the London-based company’s plans to sell the Turkey unit. HSBC Turkey is the country’s 13th biggest bank by assets, according to the national banking association, and had a book value of 3 billion liras ($1.06 billion) as of June 30.

Garanti is Turkey’s largest publicly traded lender and 40 percent owned by Spain’s Banco Bilbao Vizcaya Argentaria. Istanbul-based potential bidder Fibabanka is part of the Fiba Holding AS group controlled by Ozyegin, who founded Finansbank AS in the late 1980s before selling it to National Bank of Greece SA in 2006.

Finansbank is also up for sale, with National Bank of Greece saying it will hold talks with potential investors as it evaluates strategic alternatives for the lender. Qatar National Bank SAQ, the Persian Gulf country’s biggest lender by assets, and Fiba Holding are among those interested in acquiring Finansbank, people with knowledge of the matter said last month.

HSBC’s Gulliver said in June he would sell units in Brazil and Turkey as part of a plan to cut costs. The bank on Monday said pretax profit rose to $6.1 billion from $4.6 billion a year earlier and said the sale of its Brazilian unit to Banco Bradesco SA is on track.

HSBC, ING and BBVA declined to comment on the potential Turkish transaction, while Fiba didn’t respond immediately to requests for comment.

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