Kuwait’s NBK seeks 30 pct stake in Turkish Bank

KUWAIT/ISTANBUL - National Bank of Kuwait (NBK), one of the biggest banks in the Middle East, said on Friday it was in talks to buy a 30 percent stake in Turkish Bank as part of an expansion push abroad.

By (Reuters)

Published: Sat 12 May 2007, 3:52 PM

Last updated: Sat 4 Apr 2015, 11:00 PM

NBK Chief Executive Ibrahim Dabdoub confirmed the talks after two officials from Turkish Bank earlier said on Friday that NBK wanted to buy a minority stake in the small, unlisted lender.

“We want to expand our operations in Turkey,” Dabdoub told Reuters. “We want to offer consumer and corporate banking services.”

Dabdoub, declining to specify the price, said the deal may be finalised in two or three weeks. “We are in the final stage.”

NBK, the third-biggest Gulf lender by market value, told Reuters in March it was in talks to acquire a medium-sized bank in Turkey as it expands overseas.

Like other Gulf banks benefiting from an economic boom on the back of high oil prices, NBK is growing abroad to offset strong competition at home, where foreign players such as HSBC HSBA.L and BNP Paribas have entered the fray.

Dabdoub said investment banking unit NBK Capital was already active in Turkey and that NBK wanted to offer full banking services there.

Turkish Bank has 17 branches and ended the year with total assets of 649 million lira ($481 million). As at June 2006, it was ranked 31st in the industry, according to regulatory data.

Targets in Turkey

Turkey has seen a string of foreign acquisitions of its banks in recent years with purchases from European and U.S. institutions.

Kuwait Investment Authority, which invests the Gulf Arab state’s budget surpluses as they swell due to record oil prices, bought a 2.7 percent stake in the initial public offering of state lender Halkbank this week.

In addition, the planned sale of a stake in Islamic lender Turkiye Finans is expected to bring another Gulf player into the market.

NBK said in April it planned to start operations in the UAE within six months after securing a licence in March.

NBK, which also has operations in Qatar, Jordan and other Middle Eastern countries, has said it is in talks with several banks in Egypt, including Egyptian Gulf Bank, to buy into one.

Its talks to buy a majority stake in Jordan’s Union Bank for Savings and Investments collapsed in February.

NBK had assets of 8.5 billion dinars ($29.4 billion) at the end of March, an increase of 19.3 percent from a year earlier.

In the first quarter, National Bank of Kuwait posted a 13.5 percent rise in profit and said it was on track to achieve its full-year target of around 15 percent profit growth.