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Hungary’s OTP Bank is the winner! It is buying Bulgarian arm of Societe Generale

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Hungary’s OTP Bank is the winner! It is buying Bulgarian arm of Societe Generale

OTP Bank of signed a deal to purchase Societe Generale's Bulgarian and Albanian units, solidifying its position in Bulgaria and entering a new market in Albania. France's Societe Generale is disposing of units that either lack critical size or potential for synergies within the group.

OTP's Bulgarian unit DSK Bank will acquire 99.74 percent of Societe Generale Expressbank AD, which has a market share of about 6.7 percent and is the seventh largest bank in Bulgaria. It is active in both the retail and corporate segments. "As a result of the acquisition, OTP Group will further strengthen its market position in Bulgaria," OTP said in a statement on the Budapest bourse's website, adding that its operations in Bulgaria since launching there in 2003 have been profitable.

DSK is Bulgaria's second largest lender and the deal, pending regulatory approvals, is likely to boost its market share in terms of assets to about 19 percent.
OTP did not reveal the price paid for the two banks, or any further details. Both transactions are expected to close in the fourth quarter of 2018, pending regulatory approval, OTP said. It added that it was also in talks with Societe Generale about entering into a services agreement that would allow the provision of mutual services in various fields of banking in Albania, Bulgaria, Croatia and Hungary.

OTP's Bulgarian unit DSK Bank will incorporate Societe Generale Expressbank AD's market share of about 6.7 percent, with the cumulative 19 percent making it a contender for the top spot on the Bulgarian banking market. DSK, which has been profitable since OTP took it over in 2003, is Bulgaria's second largest lender.

OTP Chief Executive Sandor Csanyi has said as many as half a dozen acquisitions were possible.

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