BNP Paribas will be interested in ABN Amro, the share price of the latter is growing – 06/17/2022 at 14:41

(AOF) – BNP Paribas has expressed interest in the possible acquisition of ABN Amro Bank, which is owned by the government since the financial crisis, according to Bloomberg. The French bank recently contacted the Dutch government and discussed its interest in the transaction, according to unknown sources. BNP Paribas is interested in ABN Amro’s retail and corporate business, as well as the possibility of expanding to northern Europe, they said.

The Dutch government is not seriously considering this interest, Bloomberg said. The state may prefer to sell other shares on the market, which will allow it to raise funds while maintaining some control, said one of the respondents.

Asked by AOF, the Dutch Ministry of Finance said it could not make any public statements about specific considerations regarding the sale of its stake in ABN Amro. He added that he “regularly communicates with various stakeholders on a wide range of topics related to this stake.” However, the Ministry of Finance clarified that it “recently informed the parliament that it had asked the NFO, which owns ABN Amro shares on behalf of the state, to advise it on the further sale of ABN Amro shares.”

For its part, BNP Paribas does not comment.

In the stock market, shares of ABN Amro jumped by 11.44% to 11.44 euros, and BNP Paribas – by 1.98% to 48.46 euros.

AOF – LEARN MORE

Key points

– Bank born in 1822, strengthened in 1999 by merger with Paribas, 1st in France and 7th in the world;

– Net banking income of € 46.26 billion from international financial services (34%), banking networks (35%) and investment banking services (31%);

– More than 80% of liabilities in “rich” countries: France – 32%, Belgium and Luxembourg – 16%, Italy – 9%, other European countries – 19%, North America – 13%, Asia-Pacific – 6% ;

– Business model based on diversification in the field and business, synergies and cooperation between enterprises, operational innovations and for customers;

– Capital owned by the Belgian state (7.7%), the Grand Duchy of Luxembourg (1%) and employees (4.4%), the 13-member board of directors is headed by Jean Lamiere, Jean-Laurent Bonnafe is the managing director;

– Stable financial position – CET 1 12.4%, return on equity 13.4% and liquidity 468 billion euros.

Problems

– GTS 2025 Plan for Growth, Technology and Sustainability, aimed at:

– return on equity 11%, annual growth of the NBI by 3.5%, self-financing of transformation and investment and distribution rate of 60%, including at least 50% of dividends:

– Innovation strategy with the highest rating in the sector and focused on digitization:

– internally: support for intrapreneurs (Lux Future Lab, People’sLab4Good, Bivwak),

– in the offer for clients: 4.4 million “digital” clients, the leader in France in digital functionality, the world’s leading platforms for government bonds, forex or swap and in the top five European non-banks with Hello Bank !,

– partnerships: a global Plug and Pay platform to accelerate startups;

– Environmental strategy, which aims to become a world leader in sustainable financing (2nd in the world for green bonds and 1st in Europe, 1st in Europe for financing renewable energy projects):

– the goal of carbon neutrality by 2050,

– by 2025, € 350 billion has been mobilized for standing loans and bond issues and € 300 billion for stable investments;

– alignment of the loan portfolio with the trajectory of the Paris Agreement (cessation of coal financing in Europe in 2030 and implementation of the Pacta methodology),

– progress in green microfinance,

– funding of 4 billion euros for biodiversity;

– On the way to joint ventures with the financial subsidiary Stellantis, which operates in Germany, Austria and the United Kingdom.

Problems

– Change in net balance sheet assets, EUR 78.7, for comparison with the stock market price;

– Constant control of management fees and risk costs;

– Russian-Ukrainian war: very little impact – the devaluation of the Ukrainian subsidiary and the interruption of services to Russian customers;

– Use of proceeds from the sale of the US subsidiary BoW – 14.4 billion euros, distributed between the share repurchase program, investment in technology and targeted acquisitions;

– After the dynamic 1st quarter, confirmation of the goals for 2025;

– Share repurchase programs and dividends for 2021 in the amount of 3.67 euros, ie 50% of profits.

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