BNP Paribas would be interested in ABN Amro, the latter’s share price skyrockets – 06/17/2022 14:41

(AOF) – BNP Paribas has expressed interest in a possible acquisition of ABN Amro Bank, which has been government-owned since the financial crisis, Bloomberg reports. The French bank recently contacted the Dutch government and discussed its interest in a transaction, unidentified sources said. BNP Paribas is interested in ABN Amro’s commercial and corporate activities, as well as the possibility of expanding into Northern Europe, they said.

The Dutch government is not seriously considering this expression of interest at the moment, Bloomberg says. The state may prefer to sell other shares on the market, which would allow it to raise money while maintaining some control, said one of the people interviewed by the outlet.

When asked by the AOF, the Dutch Ministry of Finance replied that it could not make any public announcement on the specific considerations regarding the sale of its stake in ABN Amro. He added that he “speaks regularly with various stakeholders on a wide range of topics related to this participation.” The Ministry of Finance, however, clarified that it had “recently informed Parliament that it had asked the NLFI – which holds the shares of ABN Amro on behalf of the state – to advise it on the subsequent sale of the shares of ABN Amro”.

For its part, BNP Paribas does not comment.

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

AOF – FIND OUT MORE

Key points

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

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

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

– Business model based on the diversification of offices and companies, synergies and cooperation between companies, on operational and customer innovation;

– Capital held by the Belgian state (7.7%), the Grand Duchy of Luxembourg (1%) and employees (4.4%), with a 13-member board of directors chaired by Jean Lamierre, of which Jean-Laurent Bonnafé he is chief executive officer;

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

Challenges

– GTS 2025 plan for growth, technology and sustainability aimed at:

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

– Top rated innovation strategy in the sector and focused on digitization:

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

– in the offer to customers: 4.4 million “digital” customers, leader in France in digital functions, world leading platforms in government bonds, forex or swaps and among the top five European neo-banks with Hello Bank !,

– partnership: Plug and Pay global platform for the acceleration of start-ups;

– Environmental strategy aimed at becoming the world leader in sustainable finance (2nd in the world for green bonds and 1st in Europe, 1st in Europe for the financing of renewable energy projects):

– carbon neutrality target in 2050,

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

– alignment of the loan portfolio to the trajectory of the Paris agreement (end of coal financing in 2030 in Europe and dissemination of the Pacta methodology),

– advances in green microfinance,

– € 4 billion funding for biodiversity;

– Towards a joint venture with the financing subsidiary of Stellantis, operating in Germany, Austria and the United Kingdom.

Challenges

– Change in net book assets, € 78.7, to be compared with the stock market price;

– Continuous control of management fees and cost of risk;

– Russia-Ukraine war: very marginal impact – amortization of the Ukrainian subsidiary – and interruption of services to Russian customers;

– Use of funds from the sale of the American subsidiary BoW – € 14.4 billion divided between the share buyback program, investments in technologies and targeted acquisitions;

– After a dynamic 1st quarter, confirmation of the 2025 objectives;

– Share buyback programs and 2021 dividend of € 3.67, or 50% of profit.

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