The Italian bank UniCredit has expressed a desire to acquire Luminor and thus is now competing for this right with the largest Hungarian bank OTP Bank, citing anonymous sources, Bloomberg writes. UniCredit CEO Andrea Orcel has focused his career on transforming the bank and redistributing capital to shareholders. Now that the bank's valuation is higher, Orcel sees more opportunities to deploy capital through bank acquisitions. He said he was looking at a variety of potential targets, including in Central and Eastern Europe, as he sought to strengthen UniCredit's role as a major player in the region. All three – UniCredit, Blackstone and OTP – refused to comment on the information. As reported, in May of this year, the largest Hungarian bank Országos Takarék Pénztár (OTP), which also operates in Russia, expressed a desire to acquire Luminor Bank, operating in the Baltic countries. OTP operates not only in Hungary, but also in Albania, Bulgaria, Croatia, Russia, Montenegro, Moldova, Serbia, Slovenia, Ukraine and Uzbekistan. In the past, the bank was repeatedly reproached for continuing to operate in Russia. It has already been reported that the largest Western banks that have not ceased operations in Russia paid the Kremlin more than 800 million euros last year, writes the Financial Times. OTP ranks third on this list. Last year, the bank earned 333 million euros in Russia, of which 90 million euros were transferred to the country's budget. This was previously reported by the Hungarian media. The head of the bank, Sandor Chani, explained that Russia is a “special market” that is difficult to leave. According to him, the bank has reduced its corporate portfolio by 85% and is no longer issuing new loans for businesses in Russia. At the same time, the bank's consumer loan portfolio has grown significantly. In January, however, the bank announced its intention to leave the Russian market, saying that negotiations with the relevant institutions of the European Union were ongoing. Earlier this year, OTP Bank also expressed interest in acquiring Ukrainian state-owned Sense Bank. As reported, the investment fund Blackstone Group is considering the possibility of selling Luminor Bank. Negotiations are currently underway with potential consultants for the sale of the bank, and the deal could take place as early as this year, an anonymous source told Bloomberg. The private equity firm is targeting a valuation of 1.2 times the bank's book value. Luminor's book value at the end of 2022 was €1.6 billion. As reported, in 2018, the Blackstone investment fund became a strategic investor in Luminor Bank, investing 1 billion euros. Luminor Bank was created in October 2017 as a result of the merger of Nordea Bank and DNB in the Baltic countries. In 2018, the American investment company Blackstone became a strategic investor in Luminor Bank, acquiring a controlling stake. Investments in the capital of Luminor Bank are designed for a period of five to seven years with the possibility of extension.
