DUBAI: BNP Paribas SA, France’s largest bank, agreed to sell its Egyptian arm to Dubai lender Emirates NBD for $500m as French lenders divest operations in the North African country to shore up their capital bases. BNP, like other French and European banks, has spent the past year cutting assets and staff to better withstand the euro zone’s debt crisis and tougher global Basel III rules on risk-taking.
For ENBD, majority-owned by the government, the deal offers an opportunity to expand its Dubai-centric business, having been hit in recent quarters by its exposure to debt-laden, state-linked entities in Dubai that have been forced to restructure billions of dollars of obligations.
“This deal represents an excellent opportunity for Emirates NBD to enter the promising Egyptian market and achieve our strategic aspiration of expanding regionally,” the bank’s chairman, Sheikh Ahmed bin Saeed Al Maktoum, said.
ENBD, majority-owned by the Dubai government, will buy BNP’s 95.2 percent stake in its Egyptian arm and make an offer to minority shareholders for the remaining 4.8 percent, it said in a bourse statement yesterday. Reuters
