Doha

Qatar's largest financial institution QNB is acquiring the entire 99.81% stake of National Bank of Greece in Turkey's Finansbank for $2.94bn as part of its "inorganic expansion" to become an icon in the Middle East and Africa (Mea) region.

In this regard, QNB has entered into a “definitive” agreement with National Bank of Greece for the transaction, which is expected to be completed by the first half of 2016, a Qatar Stock Exchange communiqué said.

“This transaction is a significant milestone in QNB’s Vision to becoming a Mea icon by 2017 and a leading global bank by 2030,” QNB Group chief executive Ali Ahmed al-Kuwari said.

QNB, which is also the largest lender in the Middle East and North Africa (Mena), intends to fund the purchase through its own funds and will remain strongly capitalised after the acquisition in line with its group targets, its spokesman said.

Finansbank -- has a strong capital base with a capital adequacy ratio of 15.9%, which is among the highest in the Turkish banking sector -- is the fifth largest privately owned universal bank by total assets, customer deposits and loans in the Turkish market.

Highlighting that through controlled growth, the bank aspires to become an icon in the Middle East and Africa by 2017, to achieve this, QNB Group is “pursuing inorganic growth in large, high growth markets,” he said.

Turkey -- with its significant market size, population, growth track record, strong economic and banking sector prospects and strategic location as a gateway between Europe and Asia -- represents such a market and is therefore of strategic importance for QNB group.

“We look forward to contributing towards Turkey’s future economic development and further enhancing its overall connectivity with international markets as an integral part of QNB group’s global network,” according to al-Kuwari.

QNB Capital and J.P. Morgan are acting as joint financial advisors, while Clifford Chance is acting as lead legal counsel and Yegin Çiftçi Attorney Partnership is acting as local legal counsel for the deal, which has been approved by the board of directors of both banks and the General Council of the Hellenic Financial Stability Fund.

Turkey’s ties with the rest of the region have increased in recent years, as trade with the Mena region has risen nearly ten-fold from $5.6bn in 2000 to $52.2bn in 2014.

Finansbank has grown organically into a full service financial institution with an independent and experienced management, nationwide distribution network of 647 branches and over 5.3mn customers.

As of June 30, 2015, Finansbank has $29bn worth assets, $19.5bn in loans and $14.6bn in deposits and total equity amounted to $3.6bn as per International Financial Reporting Standards.