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The turmoil surrounding the sale of OTP Bank Romania continues unabated. At the same time, interest in the takeover of the financial institution has been halved: two of the four potential buyers have cancelled their previous offers, reported Magyar Nemzet.
Only Transilvania Bank, the market leader based in Cluj-Napoca (Kolozsvár), and Austria’s Raiffesen Bank remain in the race to buy OTP Bank Romania after Erste Bank withdrew. The Hungarian parent company said that, in parallel with the bank’s organic growth strategy, OTP Group decided to expand the strategic options for OTP Bank Romania by testing the market for a possible sale of the bank. Italy’s Unicredit, Austria’s Raiffeisen Bank and Erste Bank and Banca Transilvania were interested in the financial institution, which is being put up for sale. These companies submitted a non-binding offer, which included OTP’s Moldovan stake. OTP Bank Romania could be sold for EUR 300 million or more, Bloomberg reported at the time.
The Hungarian bank entered the Romanian market in the early 2000s with the acquisition of Robank, and then acquired Millennium Bank Romania after the 2008 economic crisis.
Photo: Facebook OTP
However, its further expansion attempts were blocked by the authorities in Bucharest: in 2018, the National Bank of Romania blocked OTP Bank Romania’s acquisition of Banca Romaneasca from its Greek owner.
This may also play a role in the fact that Budapest considered that the Romanian subsidiary bank had no growth potential. According to the latest data from the Romanian central bank, OTP Bank Romania ranks 9th in the Romanian banking market in terms of assets, with a market share of 2.89%. Sándor Csányi, CEO of OTP, set a target of acquiring a 7-8 percent share in Romania and at least 10 percent in other countries in 2017. Subsequently, in 2020, the bank sold its stake in Slovakia.
In the first quarter of 2023, the financial institution’s operating profit reached 47 million lei (€9.5 million), an increase of 37 percent compared to the same period last year. The profit after tax of OTP’s Romanian subsidiary was only RON 15 million.
Via Magyar Nemzet. Featured Photo: Facebook OTP