MILAN (Thomson Financial) - Banco Popolare is expected to announce on
Tuesday or in the coming days it has reached an agreement to set up a consumer
credit venture with Credit Agricole SA. in an operation that could improve the
Italian cooperative bank's capital adequacy ratios by between 20 and 50 basis
points, analysts said.
The two companies entered at the end of March a 30-day exclusive talks
period to examine a merger between their Italian consumer credit subsidiaries
Ducato and Agos to form Italy's largest player in the sector with a market share
of about 14 percent and outstanding loans of 13 billion euros in 2007.
On March 29, Banco Popolare said the possible deal will not include cash
payments and according to initial estimates, it will generate annual synergies
of at least 50 million euros before taxes.
According to a report in Il Sole 24 Ore, the Banco Popolare board is close
to approving the venture agreement which will see the Italian bank having 40
percent of the new consumer credit entity.
Mediobanca analysts said in a note they see a 20 basis points positive
impact on the Tier 1 capital ratio.
Another analyst at a Milan-based brokerage said "this estimate looks
reasonable, though Banco Popolare aims for more".
A third analyst at a European bank said 20 basis points is too conservative
and that according to his initial calculations the deal could boost Banco
Popolare's Core Tier 1 by around 30 or even 50 basis points.
Mediobanca also said the deal is expected to have a positive impact on
earnings, though this will be minimal.
Ducato and Agos reported in 2007 a net profit of 31 million euros and 73
million euros respectively, it said.
Banco Popolare shares were little changed on Tuesday afternoon trading and
at 4:58 p.m they were traded at 12.61 euros, up 0.02 percent on the day.
danilo.masoni@thomsonreuters.com
dm/lam
COPYRIGHT
Copyright Thomson Financial News Limited 2008. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content,
including by framing or similar means, is expressly prohibited without the prior
written consent of Thomson Financial News.
|