Bulgaria: Belgian KBC Bought the Business of Raiffeisen Bank International
KBC Bank (KBC) and Austria's Raiffeisen Bank International (RBI) have announced that they have reached an agreement with a Belgian-based banking group to acquire 100% of the shares of Raiffeisen (Bulgaria) EAD, which conducts banking operations on the side of RBI.
The deal also includes Raiffeisen Leasing Bulgaria, Raiffeisen Asset Management (Bulgaria), Raiffeisen Insurance Broker (serving corporate and leasing clients of Raiffeisen (Bulgaria), and Raiffeisen Service. All these companies are entirely owned by Raiffeisen (Bulgaria).
The value of the deal is 1.015 billion euros.
According to both parties, this reflects the quality of the Raiffeisen franchise and the potential for synergies from which the buyer expects tens of millions of euros in benefits in the coming years.
The completion of the transaction is subject to approval by regulatory authorities and is expected to be the case by mid-2022.
Raiffeisen has been doing business in Bulgaria since 1994, offering a wide range of services and is considered to be sixth in the banking market, controlling 7.9% of assets and 8.4% of loans. The network of branches includes 122 sites plus a network of mobile banking consultants, partners, credit intermediaries, staff of about 2,500 people and 635,000 customers.
Peter Ruben, who manages the business of KBC in Bulgaria, commented: "The expansion of our activities in Bulgaria, the integration of high quality products of Raiffeisenbank Bulgaria, while building on the competence and dynamism of both UBB and DZI, will help us I look forward to welcoming the staff and management of Raiffeisenbank Bulgaria and I am convinced that together we will further strengthen our leadership position, which will benefit all our customers and other interested parties.”
KBC Group has been in Bulgaria since 2007, and since 2009 the country has been a key market for the banking group. Today they own United Bulgarian Bank, DZI, UBB Interlease, UBB Pension Insurance, UBB Asset Management, UBB Factoring, UBB Insurance Broker and KBC Group Bulgaria Branch.
The last major deal was the acquisition on July 30 this year of NN Pension Insurance, which merges with DZI and UBB Pension Insurance.
UBB is the third in terms of assets, and DZI has the largest market share in the insurance market.
The new United Bank will have a market share in assets, very close to that of the other two leading banks in Bulgaria, which will establish itself as a clear leader, striving for the first place. In addition, UBB will take 2nd place as a market share in terms of loans. With this, KBC Group establishes itself as the number 1 fully integrated financial group, offering the full range of financial services to its clients in Bulgaria, according to the announcement on the UBB website.
The forecast merged company (Raiffeisenbank Bulgaria and UBB) will achieve 18.2% market share in terms of assets (compared to UBB's 10.3% market share), which is very close to the market share of market player number 1 (19.8%) and market player number 2 (18.4%). In addition, the United Bank of UBB and Raiffeisenbank Bulgaria will take 2nd place in terms of loans (17.0% forecast market share).
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