Major change in Croatian banking sector.
Hungarian OTP Bank has announced that it will buy Splitska Banka, a member of the Societe Generale Group, reports tportal.hr on December 21, 2016.
Societe Generale Splitska Banka is the fifth largest player in the Croatian banking market. As a result of this acquisition, the market share of OTP Group will increase to approximately ten percent. OTP Bank has been present in Croatia since 2005 with constant profitable business operations, even during the economic crisis that began in 2008.
The financial closing of the transaction is expected in the summer of 2017, and it is estimated that the integration process could be completed by summer 2018.
Recently, there have been rumours that Societe Generale might buy Zagrebačka Banka, the largest bank in Croatia which is currently owned by Italian UniCredit. OTP's takeover of Splitska Banka may suggest that Societe Generale has not abandoned its plans with regards to Zagrebačka Banka, because it could not take over Zagrebačka Banka since it would have too large a share of the Croatian banking market.
Hungarian OTP Bank had already performed due diligence of Splitska Banka. On the other hand, UniCredit has already sold part of its operations in Poland and other countries in the region, and the international media have already speculated that, especially if the process of raising capital does not continue as planned, Zagrebačka Banka might be next to be sold. The potential deal would be worth between 1 and 1.5 billion euros, and Societe Generale Group might be interested in buying.
Two largest banks in Croatian banking market are Zagrebačka Banka and Privredna Banka Zagreb. Data of Croatian National Bank show that at the end of 2015 Zagrebačka Banka had assets of nearly 106 billion kuna, accounting for 26.4 percent of total assets of all banks currently operating in Croatia. Privredna Banka Zagreb was at the second position with assets worth 69.7 billion kuna and the market share of 17.3 percent, while the third is Erste Bank, with 59 billion kuna of assets and 14.7 percent of the market. Erste Bank was followed by Raiffeisen Bank and Splitska Banka.
OTP Bank entered Croatia after MOL had purchased its stake in INA and is currently the eighth largest bank in the country. The bank was created in 2002 by the merger of three regional banks – Dalmatinska, Istarska and Sisačka – with Dubrovačka Banka added in October 2004. In March 2005, OTB Bank, which is the largest Hungarian bank, became the majority owner of what is now OTB Bank Croatia.
