Eurobank continues the sale of its Serbian subsidiary Eurobank Direktna by signing a binding agreement with AIK Banka ad Beograd. Eurobank Direktna is 70% owned by Eurobank Holdings and 30% by the old shareholders of Direktna Banka.

The deal, according to a statement by the Eurobank group, “values ​​100% of the share capital of Eurobank Direktna at 280 million euros and is estimated to contribute around 50 bp. to the core capital ratio (CET 1) of the Eurobank Group (based on the ratios of the third quarter of 2022).

The sale and exit of the group from the Serbian market comes one and a half years after the acquisition of the Serbian bank and its merger with Eurobank Beograd, and, as Eurobank notes in a statement, this move “is in line with the group’s strategy to channel funds into investments with prospects for higher returns and for further strengthening its presence in the main markets in which it operates, especially in Greece, Bulgaria and Cyprus.”

Eurobank Direktna, headquartered in Belgrade, operates in four core areas of retail banking, large and medium-sized enterprise banking, small business banking and digital banking, while maintaining a market share based on total assets of 6%.

A binding agreement was signed with AIK Banka on Direktna.

It has 1,600 employees, a network of 98 stores and a balance sheet of 2.4 billion euros, and in the third quarter of 2022 its net income was 3.2 million euros. It should be noted that the net profit of the subsidiary in Bulgaria is 23.9 million euros, and that of the subsidiary in Cyprus is 22.8 billion euros, and they constitute the most important part of the profitability of the foreign network.

As Eurobank notes in a statement, AIK Banka is one of the most prominent banking institutions on the Serbian market with over 40 years of tradition and an 8.2% market share based on its assets.

The deal is expected to close during 2023 and is subject to mandatory regulatory approvals, with UBS acting as Eurobank’s exclusive financial advisor on the deal and BNP Paribas providing a fair and fair valuation report. Milbank LLP and Zivkovic Samardzic Law Office act as the seller’s international and local legal advisors, respectively.

The Eurobank statement concludes that the bank “participates in national mourning and expresses deep sorrow and condolences to the families of the victims. The publication of the transaction and the release of this announcement at this particular time is a regulatory obligation.”