KBC Acquires Part of IFC’s Stake in Russia’s Absolut Bank
KBC and the shareholders of Absolut Bank reached agreement for KBC to acquire 92.5 percent of Absolut Bank, one of the leading independent mortgage lenders in Russia.
IFC (the International Finance Corporation), the private sector arm of the World Bank Group, which holds the remaining 7.5 percent of the shares, has now decided to sell 2.5 percent of its shareholding to KBC, thus bringing KBC’s stake in Absolut Bank to 95 percent. IFC will retain a 5 percent shareholding in Absolut Bank.
The acquisition of Absolut Bank is still subject to the regulatory approval of the Central Bank of Russia and the Antitrust Commission. KBC expects the deal to be closed during the third quarter of 2007.
Jan Vanhevel, CEO of the Central and Eastern Europe Business Unit at KBC Group welcomed today’s agreement, saying, “Absolut Bank is one of the fastest-growing banks in Russia and has doubled its loan book year after year for the last five years. For KBC, the acquisition constitutes a logical and important step in our international expansion. Having established a strong presence in a number of first- and second-wave EU-accession countries, KBC is now entering a new emerging European market. KBC is very pleased to be able to rely on IFC’s long-standing experience and thorough knowledge of the Russian banking market.”
Since 1993, IFC has invested $3.4 billion in debt and equity in Russia, including $527 million in syndicated loans, in over 130 projects across a variety of sectors. IFC’s investment portfolio in Russia currently stands at $2 billion, making it the largest country exposure for IFC globally. “IFC is very pleased to start a partnership with KBC Bank in Russia and is looking forward to further developing Absolut Bank, one of the most successful private banks in the country,” commented Jerome Sooklal, IFC’s Director for Central and Eastern Europe.
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