Banking M&A: UniCredit takes majority stake in ATF Bank


Guy Norton
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UniCredit stole a march on its banking rivals in late June with the signing of an agreement to buy at least 85% of Kazakhstan’s fifth-largest financial services provider, ATF Bank. The roughly $2.2 billion transaction will catapult the Italian bank to the top of the foreign bank pile in the oil-rich central Asian republic, with UniCredit leapfrogging such rivals as Citi, Deutsche Bank, HSBC and ING, which all have long-established operations in the country.

Erich Hampel: ATF supports our expansion strategy

Founded in 1995, ATF Bank has 110 branches, $8.4 billion of assets and an 11.8% share of the roughly $78 billion banking market in Kazakhstan, where GDP growth has averaged 10% since 2000. The bank’s traditional business focus has been on corporate banking but in recent years it has expanded into fast-growing retail banking as well. The bank also boasts a network of subsidiaries in Kyrgyzstan, Tajikistan and the Russian region of Omsk. The purchase is being conducted by UniCredit’s Bank Austria Creditanstalt subsidiary, which manages the bank’s central and eastern European operations. Pending all the necessary regulatory approvals the purchase of ATF Bank should be completed by the end of the year, with UniCredit ultimately looking to secure a 100% stake. Credit Suisse and UniCredit’s own investment banking unit are acting as advisers on the transaction, which is the latest in a series of acquisitions by the bank in the fast-growing markets of the Commonwealth of Independent States. In December, for example, UniCredit, Italy’s largest bank, paid $424 million for Russian brokerage Aton Capital, and in July it will increase its holding in its Russian subsidiary International Moscow Bank by 9.97% to 100%. Commenting on the acquisition, Bank Austria Creditanstalt’s chief executive, Erich Hampel, says: "Kazakhstan is one of the most active economies in the CIS region. The country is expected to maintain close to double-digit real GDP growth in the next three to four years, resulting in a constantly increasing GDP per capita. Despite being young, the Kazakh banking sector is extremely well developed compared with other CIS countries. We believe that ATF, which already operates in contiguous countries through direct subsidiaries, can very well support our expansion strategy." In contrast to UniCredit, arch-rival Raiffeisen International was forced to sell out of the Kazakh banking market in 2006 when it failed to secure agreement on the purchase of a majority stake in the country’s number two bank, Bank TuranAlem. It did, however, register a €102 million one-off gain on the sale of its 7.7% stake in BTA to a group of Scandinavian investment funds. Investor demand for Kazakh banking assets in general remains strong, with last year’s listings on the London Stock Exchange for Kazkommertsbank and Halyk Bank meeting strong demand. Kazakh bank Eurobonds also remain well bid.