StanChart ends talks to buy Egypt bank
Cairo, November 29, 2011
Standard Chartered has ended talks to acquire the Egyptian unit of Greece's Piraeus Bank because of a worsening economic climate, Piraeus said.
Egypt's crisis-hit economy suffered a fresh blow last week when street violence and political chaos helped push the pound currency to its lowest in more than six years and Standard & Poor's lowered its credit rating on Egypt, saying a 'weak political and economic profile' had worsened.
Piraeus said Standard Chartered's decision was taken in light of 'a deteriorating global macroeconomic environment and not on account of issues arising out of their due diligence of Piraeus Bank Egypt,' according to a statement received by Reuters and confirmed by an official at the Greek bank in Athens.
It said it had received expressions of interest in the Egyptian business from third parties during the talks and would now make contact with them.
Egypt's central bank had given initial approval to a sale of Piraeus Bank Egypt to Standard Chartered. Piraeus has been trying to strengthen its balance sheet in light of the crisis facing Greece's debt-laden economy.
Piraeus Bank Egypt had equity capital of 103 million euros ($137.52 million), a 737 million euro loan book, assets totalling 1.38 billion euros and 48 branches at the end of March.
The Greek bank said the unit 'continues to maintain high levels of capital adequacy and liquidity on a standalone basis, and will continue to provide banking services to its Egyptian client base as a member of Piraeus Bank Group.' – Reuters