Madrid, 20 (European Press)
French bank BNP Paribas has reached an agreement to sell $16,300 million (€14,505 million) of 100% of its commercial and commercial banking activities in the United States through its state subsidiary Bank of the West to the Canadian Entity Bank. Montreal (BMO Financial Group), as reported by both banks.
The transaction, which will close within 2022, will generate an estimated net capital gain for BNP Paribas of approximately €2,900 million upon closing, with a positive impact on its capital core ratio (CET1) of approximately 170 basis points.
The French bank indicated that it intends to make an extraordinary distribution in the form of share repurchases after closing the deal, to compensate for the expected reduction in earnings per share from BNP Paribas, noting, as an indicator, that the share repurchase program of about 4 billion euros would completely neutralize as This dilution.
Likewise, the French Bank intends to reallocate the remaining income, equivalent to about 7,000 million euros of paid-in capital, over time and in a very disciplined manner, with the aim of improving long-term value creation by accelerating organic growth, particularly in Europe, as well as specific investments in Innovative technologies and business models, as well as the ability to make value-added business acquisitions.
In this regard, BNP Paribas will present its main strategic hubs within the framework of the publication of its 2021 annual accounts on February 8, and will detail its strategic plan for 2025 on Investor Day, scheduled for March 14, 2022.
“BNP Paribas’ presence in the United States remains a strategic pillar of the development of our corporate and institutional franchise. With this transaction, BNP Paribas also underscores its commitment to delivering value to all of its shareholders,” said Jean-Laurent Bonnave, CEO. for the entity.
For its part, the Canadian bank confirmed that the acquisition of Bank of the West will accelerate its growth in North America. “We have never been in a better position to take the next step in our growth strategy,” said Daryl White, CEO of BMO Financial Group, to whom this acquisition will add significant scope, expansion into attractive markets and capabilities that will drive further growth. Returns and efficiencies.
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