Societe Generale, the second-largest French banking group, withdrew from the race for taking over CEC (Romania''s Savings Bank), dropping the plans to submit a preliminary bid, despite showing its interest in a letter sent to the privatisation committee on August 31.
Banking sources say the strategic assessments made by BRD''s majority shareholder in September tipped the balance towards dropping CEC acquisition plans.
Hanging in the balance were, on the one hand, the consolidation of the competitive position against a strong competitor of Societe Generale in the Central and Eastern Europe, Erste Bank, and, on the other, the risk of CEC''s precarious situation affecting BRD''s equilibrium, partly because of the financial effort relaunching the savings bank entails.
After careful consideration of the condition CEC is in, based on the documents in the data room, the French gave up takeover plans, even though that would have turned them into direct competitors for the number one position of the bank ranking. BRD''s market share stands at over 14%, to which the five percent of CEC would have added. The largest bank, BCR, accounted for 25.1% of the banking system assets in mid this year.
With analysts now seeing Erste Bank as standing big chances of winning the competition for BCR, Societe Generale could find itself having to compete with the Austrians in a much rougher context, with the latter being in the lead. Banking sources quoted by Reuters say Erste Bank shareholders are confident in the bank''s strategy over the last few years, largely based around expansion in Central and Eastern Europe that paid off, so that they could agree to paying a high price for BCR, unlike the shareholders of other competitors that might be reluctant in this respect.
Now that Societe Generale has forfeited the race, the list of potential investors for Casa de Economii si Consemnatiuni (CEC) comprises seven names: Banca Monte dei Paschi di Siena, Dexia Bank, EFG Eurobank, Erste Bank, the National Bank of Greece (NBG), OTP Bank and Raiffeisen.
Out of the seven, Dexia, Erste and NBG are already competing directly over the 62% stake in Banca Comerciala Romana, while CEC is a fallback solution. In case none of them gets BCR, the battle is expected to be fought over CEC, where the ambitions of Hungary''s largest banking group, OTP Bank come into play, as well.
razvan.voican@zf.ro
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