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EBRD becomes shareholder in Serbia’s Komercijalna Banka
Important equity investment to prepare bank for IPO
In one of its biggest investments in Serbia and Montenegro, the EBRD is
becoming a significant shareholder in Komercijalna Banka by acquiring a 25 per
cent stake for €70 million. The EBRD’s Board of Directors also approved a €30
million, 15-year loan for Komercijalna Banka to finance residential mortgages
in Serbia.
Komercijalna Banka is Serbia’s largest majority state-owned bank and the
country’s third largest bank by assets. With almost 300 branches and outlets,
it has the largest network in the country and substantial potential to develop
further in particular its retail and SME banking operations.
The EBRD’s investment in Komercijalna Banka will prepare the bank for an IPO
in three to five years. Applying its expertise and experience in supporting
the reform of banking sectors across its region, the EBRD will put special
emphasis on the implementation of an Institution Building Plan developed in
cooperation with Komercijalna Banka’s management. The programme will be
financially supported with technical assistance funds provided by the
Government of Canada.
The Institution Building Plan will focus on key areas such as raising
corporate governance to international levels, strengthening credit and risk
management procedures, upgrading customer services and introducing new IT
systems. The main objective will be the development of Komercijalna Banka into
a modern, efficient bank in an increasingly competitive financial market.
Kurt Geiger, EBRD Business Group Director Financial Institutions, said the
EBRD will serve as a catalyst for the restructuring of Komercijalna Banka and
will work with the Serbian government, the other minority shareholders and the
management of Komercijalna Banka towards a full privatisation of the bank.
Komercijalna Banka has excellent potential to build on its market position and
increase the level of financial intermediation in the country. The EBRD’s
investment will also facilitate Komercijalna Banka’s access to long term
funding in international commercial markets. Furthermore, it signals growing
confidence in Serbia’s economic development and is thus expected to encourage
further investments.
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