Greek lender Eurobank announced on Monday (Dec. 13) it wrapped up the merger of its Serbian subsidiary with Serbia’s universal commercial bank Direktna Banka.
The combined bank (known under the new name Eurobank Direktna) in which Eurobank holds 70%,
will have total assets in excess of €2bn, total equity above €300m and a market share of 6.5% in customer loans, becoming the seventh largest in Serbia.
Both parties have committed to a growth-oriented business plan, incorporating ambitious expansion targets that will allow the combined bank to finance the Serbian economy and grow profitably in the next few years.
As part of the transaction, Eurobank’s unit in Serbia (Eurobank a.d. Beograd) will distribute to Athens-based Eurobank Group via dividend payment and capital return an amount of c. €232m.
Mr. Stavros Ioannou, Deputy CEO, Group Chief Operating Officer (COO) & Head of International Activities of Eurobank, said:
“We are pleased to have reached an agreement with the principals of Direktna for the merger of our two banks in Serbia and the creation of a much stronger, larger and dynamic local financial institution.
For their part Mr. Andrej Jovanović and Mr. Bojan Milovanović, principals of Direktna, commented: “We believe that Eurobank Direktna will have a unique opportunity to benefit from strong institutional background and size brought by our partners from Eurobank and from our deep understanding of our home market.”
BNP Paribas acted as the exclusive financial advisor to Eurobank Serbia in connection with the transaction while Milbank LLP, Živković Samardžić Law Office and Moravčević Vojnović in cooperation with Schoenherr provided legal assistance and advice.
The merger was announced in July and is in line with Eurobank’s strategy to further strengthen its position in the countries where the Group maintains a presence and grow further with targeted acquisitions and friendly mergers. The Eurobank Group, established in Greece in 1990, operates in Greece, Cyprus, Luxembourg, Serbia, Bulgaria and UK and has become a leading force in the Greek banking sector.
Direktna, established in Serbia’s central city of Kragujevac in 2016, is a modern, domestic and universal bank, whose business strategy is focused on business with the population and the economy. It was created by the purchase of KBM Bank, then Findomestic BNP Paribas and Piraeus Bank a.d. Beograd, which formed a strong and stable financial institution.
There are currently 23 banks operating in Serbia. The new bank’s network includes 127 integrated branches in Serbia.
Clients will have access to all products and services as before. All contracts and other obligations will see no changes in realisation, the new bank has said in a statement.