A new round of mergers in the European banking industry may be taking hold as a battle for Dutch bank ABN Amro Holding NV heats up and France's Societe Generale SA and Italy's UniCredit SpA reportedly enter talks.
German daily Handelsblatt reported on Friday that Societe Generale chief Daniel Bouton and UniCredit head Alessandro Profumo had begun discussions, adding to several days of speculation over the two firms.
But Societe Generale later said in a statement that no negotiations of that kind were occurring, while UniCredit refused to comment.
As for ABN Amro, officials from the Dutch bank were set to meet today with a consortium comprising Britain's Royal Bank of Scotland Group Plc, Santander Central Hispano SA of Spain and Belgian-Dutch group Fortis.
ABN Amro, the biggest Dutch bank, is currently in exclusive talks with British bank Barclays Plc, the UK's third-largest bank, over a potential takeover. They have yet to disclose a price or terms.
Mergers between European banks have occurred to some degree in recent years, including Santander's purchase of Britain's Abbey National in 2004 and France's BNP Paribas' deal for Italy's BNL last year.
But the recent talks seem to mark a new stage in activity.
Shares in French banking group Societe Generale hit record high points last week on rumours that UniCredit was planning a takeover bid.
A merger between them would create the second-largest bank in Europe behind Britain's HSBC, and the seventh-largest in the world with a market capitalization of about 150 billion euros (US$204 billion). It would include 45 billion euros in annual revenue.
It would also mean the end of an era for Societe Generale, which has taken a prudent approach with modest acquisitions since failing to merge with Paribas in 1999.
The bank has remained a relatively affordable target because of its average capitalization.
Millan Gudka, an analyst with Dresdner Kleinswort, said the deal would make sense "because the two companies have complementary activities," with "most synergies occurring in finance and investment banking."
Credit Suisse values the synergies at 2.1 billion euros and also identifies potential savings in technology and administrative areas.
Analysts also note the apparent good relations between the two banks, shown by Societe Generale co-CEO Philippe Citerne's presence on UniCredit's board until December 2005.
But analysts do not expect fast movement on a merger or takeover.
Jean-Pierre Lambert, analyst at Keefe, Bruyette and Woods, named obstacles such as the French presidential election and the integration of German bank HypoVereinsbank (HVB) following its purchase by UniCredit in 2005.
In London, meanwhile, a spokeswoman for the UK Financial Services Authority (FSA) said on Saturday that the lead regulator of the bank that would be created by the possible merger of Barclays and ABN Amro hasn't yet been agreed on.
The FSA "remains in close contact with the Dutch National Bank," Cerris Tavinor, a spokeswoman for the London-based regulator, said in a telephone interview.
The two bodies will decide on the "appropriate regulatory arrangements including the identity of the lead regulator," she said.
The proposal by London-based Barclays that the Dutch central bank take over as its main regulator should it buy ABN Amro is being questioned by the FSA, the Financial Times reported on Saturday, citing unidentified people familiar with the talks.
The UK regulator judges that while the new group would have its headquarters in Amsterdam, its "center of gravity" would be in the UK, the newspaper said.
If the FSA doesn't agree to let the Dutch Central Bank be the lead regulator, a "key" concession Barclays is making to ABN Amro to complete the transaction would be undermined, the Financial Times said.
‘WEAK POSITIVE’: The man arrived in Taiwan in May and was quarantined for two weeks, Chen Shih-chung said, adding that he might be infected a long time ago The government is considering tightening mask-wearing rules again in light of a potential domestic COVID-19 infection, Minister of Health and Welfare Chen Shih-chung (陳時中) said yesterday. The Central Epidemic Command Center (CECC) confirmed seven new COVID-19 cases, six of which are imported. The other case involves a Belgian engineer who entered Taiwan on May 3 and remained in quarantine until May 17, said Chen, who heads the CECC. Although the source of infection has yet to be identified, the case could end the nation’s record of not having any domestic cases in the previous 110 days. The Belgian, in his 20s, is a technician
BRIBERY CASE: President Tsai Ing-wen accepted Su Jia-chyuan’s resignation as he said that he deeply regretted causing trouble for the president due to the investigation Presidential Office Secretary-General Su Jia-chyuan (蘇嘉全) yesterday resigned after his nephew, Democratic Progressive Party (DPP) Legislator Su Chen-ching (蘇震清), was implicated in a bribery case related to a dispute over the ownership of Pacific Sogo Department Store (太平洋崇光百貨). “I resigned from the post so that President Tsai Ing-wen (蔡英文) would not be bothered by it anymore, and the prosecutors can investigate the case in a fair and just manner. I thank President Tsai once again for supporting me. May the country continue to prosper under her leadership,” Su Jia-chyuan said in a statement. The Presidential Office said that Tsai has accepted
ALEX AZAR: The first visit by a head of the Department of Health and Human Services would strictly observe the CECC’s special regulations, the Ministry of Foreign Affairs said US Secretary of Health and Human Services (HHS) Alex Azar is to lead a delegation to Taiwan — the highest-level visit by a US Cabinet official since the two sides cut formal relations in 1979. The plan was announced yesterday morning by the US Department of Health and Human Services and confirmed by the Ministry of Foreign Affairs (MOFA). Beijing has expressed its concerns to Washington, Chinese Ministry of Foreign Affairs spokesman Wang Wenbin (汪文斌) said later yesterday. Taiwan and the US only issued statements saying that the visit would happen “in the coming days.” MOFA said that due to security concerns, it would
The military last week sent “no small number” of Marine Corps officers to the Pratas Islands (Dongsha Island, 東沙群島) following reports of a Chinese People’s Liberation Army (PLA) drill targeting the islands scheduled for this month. In an interview with Hong Kong’s Bauhinia Magazine published on Saturday last week, PLA National Defense University professor Li Daguang (李大光) confirmed that the Chinese army was planning to stage a simulated invasion of the Pratas Islands in the South China Sea this month. The islands comprise three atolls, with Pratas Island, at 1.74km2, being the largest. They lie southwest of Taiwan proper in the South