Banking M&A Digest #44 (3.10.2019)

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Corporate Financier’s Notes  

by Aivars Jurcans

Done! And Done

PayPal has received the central bank’s approval to acquire a 70% stake in Guofubao (Gopay), a small Chinese online payments company, for an undisclosed sum. This transaction makes PayPal the first foreign company to enter the Chinese payments market. 

Source: FT, Reuters

Deals On the Table

Banco de Sabadell, a Spanish lender, is said to be preparing for a potential sale of its asset management business to bolster the capital. Sabadell Asset Management had more than EUR 16 billion of assets under management at the end of 2018.

Source: Bloomberg

Petrus Advisers and Teleios Capital Partners, two activist investors, are said to be calling on Aareal Bank, a German real estate lender, to sell its entire software and services division which is valued at about EUR 550 million.

Source: Bloomberg

Ubi Banca, an Italian lender, is being urged by its top shareholder, Fondazione Cassa di Risparmio di Cuneo, to assess merger opportunities with banks like MPS, BPER Banca and Banco BPM.

Source: Reuters

Westpac Banking Corp, Australia’s 2nd largest bank, is said to be considering selling its life insurance business. The expected deal is likely to involve a long-term partnership with the buyer and could value the unit at close to USD 1.35 billion.

Source: Reuters

Kiatnakin Bank, a Thailand’s lender, is said to be open to a merger while planning to expand its wealth management business. The bank manages about USD 19.5 billion of assets of high net worth individuals and has a network of 65 branches.

Source: Bloomberg

Thanks, But No Deal

Bank of Nova Scotia, Canada’s 3rd largest lender, will not to proceed with a proposed sale of its operations in Guyana because of the opposition from the central bank.

Source: Reuters

Metrics To Watch

Lloyd’s of London expenses-to-premium ratio of c.40% is ten percentage points higher than at Zurich Insurance

Source: FT

Commerzbank, a German lender, expects a return on equity of more than 4% in 2023, which compares with an estimated cost fo equity of about 10%.

Source: FT

Follow the Money

About 40% of Coutts & Co, a UK private bank, client assets are in passive strategies, up from less than 10% four years ago.

Source: FT

Goldman Sachs’s new consumer bank, which operates under the brand Marcus, has lost USD 1.3 billion since launching in 2016. Meanwhile, it has gathered USD 50 billion in deposits as a low-cost funding for the bank.

Source: WSJ

Exciting Numbers

Global M&A activity has fallen 11% so far this year to USD 2.8 trillion, with roughly USD 740 billion of deals clinched in Q3, according to Refinitiv.

Source: FT

A Thought Worth Noting

“Many people in Germany believe that the ECB doesn’t make monetary policy for the eurozone as a whole but has made decisions that favour southern European countries in particular and produce a redistribution of wealth.”

Jorg Kramer, chief economist, Commerzbank


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Aivars Jurcans has more than 20 years of corporate finance and investment banking experience. His services are currently available through MURINUS ADVISERS.

Photo by Joe Taylor on Unsplash

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