CEO of OTP Bank: “In the next two years, we will buy at least five banks” – $1 billion to expand presence in central an eastern Europe

Hungary’s largest commercial lender is planning at least five bank takeovers in the next two years, seeking to profit from a wave of consolidation across the industry. OTP Bank expects to see the share of group revenue generated from outside the country rise to 70 percent after the deals from about 45 percent currently, Chairman and Chief Executive Officer Sandor Csanyi (photo) said in an interview in Budapest last week.

While some European banks are struggling with new capital requirements, OTP said it’s been readying itself for two decades for the right conditions to take advantage of M&A opportunities. The Hungarian group, one of Europe’s best-capitalized banks, is using a $1 billion war chest to expand its presence in central and eastern Europe, weighing targets from Bulgaria to Belarus.

The acquisition plans come on top of the three banks OTP has agreed to buy in the past year.

“In the next two years, we will buy at least five banks,” Csanyi said, without naming the potential targets. “We’ve waited for 20 years for this wave of banking consolidation in Europe. It’s finally happening now.”

This year, OTP completed the purchase of Croatia’s Splitska Banka, a former unit of Societe Generale, and signed agreements to buy the Serbian and Romanian units of National Bank of Greece, which it plans to consolidate in the fourth quarter of 2017 at the earliest.

Source: Bloomberg