The Swedish Nordea AB Bank was quoted this week as having signed a contract to purchase Denmark’s Fionia Bank from the Danish State at a cost of EUR 121 million.
Nordea, which is based in the Swedish capital Stockholm, advised that the buy-out would include 29 bank branches and around 400 incorporated staff.
The purchase does not bail out Fionia’s troubled corporate customers, thought to number around 2,000.
In February, amid the global economic recession, control of Fionia was assumed by the Danish state, which met solvency requirements with an injection of 1 billion kroner, around USD 170 million.
Head of Nordea’s Nordic Banking operation, Peter Schulze said: “We have captured a unique opportunity. By acquiring Fionia we continue our growth in Denmark … to the benefit of both Fionia’s and Nordea’s customers and our shareholders”.
Nordea is the region’s largest financial group and said it is confident that costs would not balloon under the new deal, claiming cost synergies would be achieved. Nordea also stated that the quality of credit in Fionia remained solid and that bad assets have been left aside. Acquired portfolios and impaired loans are consistent with the existing Danish portfolio owned by Nordea.
A decision is expected in October and is dependent on the Danish competition authority’s approval.