Turkish bank fails to negotiate price with Azerbaijani Rabitabank

Business Materials 19 March 2013 18:19 (UTC +04:00)

Azerbaijan, Baku, March 19 / Trend A. Taghiyeva /

Turkish bank İs Bankası is negotiating with Azerbaijani Rabitabank to purchase its shares, Hurriyet newspaper said.

According to the report, the initiative of selling the bank belongs to Azerbaijani Rabitabank. However, besides Rabitabank, the Turkish bank is also negotiating with several other Azerbaijani banks.

Despite the fact negotiations with Rabitabank have been held for a long time, the parties failed to agree on the price. According to the newspaper, the Azerbaijani bank requires a price that exceeds the market price by up to 2.5 times.

The Turkish largest private bank İs Bankası has repeatedly voiced its desire to enter the Azerbaijani banking market.

İs Bankası previously considered various variants of joining the market through establishing a new bank or purchasing an existing one in the country.

Founded in 1924, Is Bankasi is the largest private bank in Turkey in terms of assets. It has made a significant contribution to the development of the Turkish economy for many years. The bank has 1194 branches in Turkey with 24,788 employees. The bank also has 12 branches in Germany and one in France, Holland, Switzerland and Bulgaria.

İs Bankası's profit rose by 103 per cent up to 684 million lira in the third quarter of 2012 compared to the same period of 2011.

Rabitabank is a commercial bank that has operated since 1993 in Azerbaijan. In September 2010, Rabitabank signed an investment agreement with the International Finance Corporation (IFC) and European Bank for Reconstruction and Development (EBRD) in connection with their entry into the shareholding structure of the Azerbaijani bank.

These financial institutions bought shares equal to 25 per cent plus a share at12.5 per cent each. The total purchase price amounted to four million manat. The controlling stake in the bank is 86.1 per cent and before this deal was owned by Chairman of the Rabitabank Supervisory Board Zakir Nuriyev.

The process of these international institutions entering the number of Rabitabank's shareholders is not yet over.

As of January 1, 2013, the bank's authorised capital amounted to 30 million manat, and total capital 32.918 million manat. The nominal value of the bank's each share is 20.29 manat.

The official exchange rate is 0,7848 AZN/USD on March 19.