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Allied Irish sells Polish bank stake to Santander

Allied Irish sells Polish bank stake to Santander

Spain's Banco Santander said it has agreed to buy a majority stake in Poland's Bank Zachodni WBK from Allied Irish Banks for (EURO)2.9 billion ($3.7 billion).
The sale of the 70.36 percent stake will bolster Allied Irish's finances, hard hit by Ireland's economic slump and collapsed real estate market.
It is also part of Santander's recent expansion strategy. Last month Santander bought 318 branches from Royal Bank of Scotland for 350 million pounds ($558 million) plus the net value of the assets.
Allied Irish, Ireland's largest financial institution, has been hit hard as bad loans soared amid the country's burst property bubble. It suffered a net loss of (EURO)2.4 billion, compared to a (EURO)772 million profit the previous year.
Allied Irish group managing director Colm Doherty said the sale was the first step of the troubled company's recapitalization plan.
"We are very pleased to announce the sale of our Polish interests today at the price achieved," Doherty said in a statement.
"We continue to make good progress on other elements of the recapitalization plan and will make further announcements in due course," he said without elaborating.
Wroclaw-based Bank Zachodni is Poland's third-largest by net profit and branches, with 512 throughough Poland. Santander said Zachodni's net income last year was (EURO)222 million ($282.6 million).
"This transaction fulfils perfectly Santander's strategic criteria for acquisitions and enhances our geographic diversification," Banco Santander Chairman Emilio Botin said in the statement.
"The acquisition of Bank Zachodni WBK allows us to focus in Poland on retail and commercial banking, our core business, giving us critical mass in a market with high growth potential."
Banco Santander said in a statement the deal is subject to regulatory approvals and to a vote of Allied Irish shareholders.


Updated : 2021-04-15 14:32 GMT+08:00