BNP Paribas may be interested in ABN Amro, the latter’s share price is growing rapidly – 17.06.2022 at 14:41

(AOF) – BNP Paribas has expressed interest in a possible acquisition of ABN Amro, a bank owned by the government since the financial crisis, Bloomberg reported. According to unidentified sources, the French bank recently contacted the Dutch government and discussed its interest in the deal. According to them, BNP Paribas is interested in ABN Amro’s retail and corporate business, as well as the possibility of expansion in Northern Europe.

The Dutch government is not currently seriously considering this expression of interest, according to Bloomberg. The state may choose to sell other shares in the market, allowing it to raise funds while retaining some control, one of the people interviewed by the publication said.

When questioned by AOF, the Dutch Ministry of Finance replied that it could not make any public statements about specific considerations regarding the sale of its stake in ABN Amro. He added that he “talks regularly to various stakeholders on a wide range of topics related to this stake.” The Treasury Department, however, explained that it “recently informed Parliament that it had approached NLFI, which holds shares in ABN Amro on behalf of the state, to advise it on the subsequent sale of shares in ABN Amro.”

For its part, BNP Paribas does not comment.

On the stock market, ABN Amro jumped 11.44% to €11.44, while BNP Paribas rose 1.98% to €48.46.

AOF – LEARN MORE

Key points

– A bank founded in 1822, strengthened in 1999 by a 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 (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 locations and businesses, synergy and collaboration between businesses, operational innovation and for customers;

– The capital is owned by the Belgian State (7.7%), the Grand Duchy of Luxembourg (1%) and employees (4.4%), and the board of directors consists of 13 members, chaired by Jean Lamière, with Jean-Laurent Bonnafé as the managing director;

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

Problems

– GTS 2025 Growth, Technology and Sustainability Plan aiming to:

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

– Top-rated innovation strategy in the industry focused on digitalization:

– inside: intrapreneur support (Lux Future Lab, People’sLab4Good, Bivwak),

– in customer offering: 4.4 million digital customers, leader in France for digital features, leading global platforms for government bonds, forex or swaps and among the top five European neobanks with Hello Bank!,

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

– An environmental strategy to become a global leader in sustainable finance (2nd in the world in green bonds and 1st in Europe, 1st in Europe in financing renewable energy projects):

– the goal of carbon neutrality by 2050,

– by 2025, €350 billion mobilized in sustainable loans and bond issues and €300 billion in sustainable investments;

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

– achievements in green microfinance,

– biodiversity financing in the amount of 4 billion euros;

– Towards joint ventures with financial subsidiary Stellantis operating in Germany, Austria and the UK.

Problems

– Change in net balance sheet assets, 78.7 euros, compared to the price on the stock market;

– Constant monitoring of management fees and cost of risk;

– Russo-Ukrainian war: very minor impact – depreciation of the Ukrainian branch and interruption of service to Russian customers;

– Use of proceeds from the sale of BoW’s US subsidiary of €14.4 billion, split between share buyback program, technology investments and targeted acquisitions;

– After a dynamic 1st quarter, confirmation of targets for 2025;

– Share buyback programs and dividends for 2021 of €3.67, i.e. 50% of profit.

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