A major bank in China is negotiating a partnership or a potential takeover of Erste Bank Austria, sources close to the situation told us. Some people claim that the talks could concern the realization of a partnership between Erste Group and one of the biggest Chinese banks, in order to facilitate its operations in Central and Eastern Europe (ECE). The Chinese financial institution would do business in the region through Erste, which would serve as a liaison.
On the other hand, rumors have made the rounds in the market that the Chinese bank is interested in acquiring Erste Group Bank, an option which our sources rule out, as they say that the bank has a core of shareholders which are interested in its long term evolution and that they are not considering a potential exit.
The collaboration is caused by the growing Chinese interest in Eastern and Central Europe and in the network that the Austrian bank has in the region, the sources said. Erste is present in six countries in Central and Eastern Europe (Czech Republic, Slovakia, Hungary, Croatia, Serbia and Romania), aside from its country of origin. Also, the bank operates in the Community of Independent States, more specifically in the Republic of Moldova, through BCR Chişinău, a subsidiary of BCR.
The largest shareholder of the lender is the Erste Foundation, which owns 15.1% of the capital directly and 8.5% indirectly. Spanish bank Caixa Bank controls 9.1% of the capital, and the Austria Versicherungsverein foundation holds 4.1%. The employees of Erste Bank hold 2.3% of the shares, retail investors hold 6.7% and institutional investors hold 54.3%, according to the data provided by the banks at the end of July.
Following the partnership with Erste, the Chinese bank will be able to conduct currency conversions from yuan to the currencies in the region, and vice-versa, without going through E
