Banca Intesa and the controlling shareholders of UPI Banka, Sarajevo signed a share purchase agreement for the acquisition of a majority stake in UPI Banka. The transaction is expected to be finalised early in the first quarter of 2006, after the regulatory authorities in Bosnia and Herzegovina and in Italy have approved it and Banca Intesa has launched a takeover bid.

Banca Intesa will pay €202 for each share for a maximum of approximately €46.2 million for 100% of the share capital of UPI Banka - equal to 2.7 times the bank’s book value as at 31st December 2004. The transaction is structured as follows: Banca Intesa will initially acquire 35.03% of UPI Banka’s share capital in which EBRD (the European Bank for Reconstruction and Development) will keep its current 19.98% stake. As required by local regulations, Banca Intesa will then launch an agreed takeover bid for 100% of the bank’s share capital. If on expiry of the offer period the threshold of 50% plus one share is not reached, EBRD is committed to sell the number of shares necessary to enable Banca Intesa to reach a majority stake.

UPI Banka is the fifth largest bank in Bosnia and Herzegovina in terms of total assets. At 2004 year-end, it had €196 million of assets, €158 million of customer deposits, €90 million of customers loans and €17.1 million of shareholders’ equity. For the twelve months ended 31st December 2004, its net income amounted to approximately €2 million. UPI Banka has a network of 15 branches serving approximately 45,000 clients.

This transaction confirms Banca Intesa’s confidence in the development process of Bosnia and Herzegovina after the Bank’s tender offer launched this August for the control of ABS Banka, Sarajevo. As regards the latter, Banca Intesa communicates that at the expiry date of the offer period the conditions for the closing of the takeover were not met since the shares tendered were below the threshold of 50% plus one neither did Banca Intesa accept a lower percentage. Banca Intesa specifies that it is not considering any possible re-launch of the bid.

At present Banca Intesa already has a widespread presence in Central-Eastern Europe with Croatia’s second largest bank Privredna Banka Zagreb (PBZ), Slovakia’s second largest bank Vseobecna Uverova Banka (VUB), Serbia and Montenegro’s second largest bank Delta Banka and Hungary’s fourth largest bank Central-European International Bank (CIB). Moreover, the Bank is completing the acquisition of KMB in the Russian Federation where it has already a presence with ZAO Banca Intesa - the only Italian banking subsidiary licensed to operate in Russia - and a representative office in Moscow. Banca Intesa is also active in the Czech Republic through VUB, in Slovenia with the operations of its Italian banking subsidiary Banca Popolare FriulAdria and in Poland with a representative office in Warsaw.


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