Equa bank will end operations on the Czech market following merger

Austrian parent group Raiffeisenbank International says the acquistion would strengthen its digital services.

Raymond Johnston

Written by Raymond Johnston
Published on 08.02.2021 11:19 (updated on 08.02.2021)

Raiffeisenbank International (RBI) bought 100 percent of the shares of Equa bank from AnaCap Financial Partners. The transaction is subject to regulatory approval, and the price of the transaction was not disclosed.

If approved, Equa bank, which has been on the Czech market for 10 years, will cease operating as it will be fully merged into RBI’s Czech division, Raiffeisenbank. Equa bank currently serves almost 480,000 customers.

“Raiffeisenbank is in very healthy financial shape. It is a solid, strong and stable financial institution with ambitions of future growth both organically and through buy-and-build. The acquisition of Equa bank fully aligns with our wider business strategy,” Raiffeisenbank CEO and board chairman Igor Vid a said in a press release.

“The Czech Republic is one of RBI’s focus markets where the RBI Group is committed to drive growth. RBI supports Raiffeisenbank's management in related activities to both identify and achieve this growth potential,” he added.

The business models of Equa bank and Raiffeisenbank complement each other, according to the RBI press release. One area where Equa bank is strong is digital services, an area that Raiffeisenbank has been looking to improve in.

The merger would lead to significant strategic synergies and further development not only in the field of digital services for clients, according to RBI.

Equa bank is significantly smaller than Raiffeisenbank in terms of asset volume, but Equa bank’s high level of customer satisfaction and its impressive growth in lending make it an attractive acquisition, according to RBI.

Equa bank spokeswoman Petra Kopecká confirmed the deal. “If the acquisition is successfully completed, we plan to merge Equa bank with Raiffeisenbank, thus fully increasing the synergy effect, especially in the area of cost savings and revenue growth," she told news server CzechCrunch, adding that operational integration should be completed in the middle of 2022.

At the end of 2021, Equa bank's total assets amounted to EUR 2.8 billion. During the same period, Raiffeisenbank reported total assets of EUR 15.7 billion.

The transaction should be completed at the end of the second quarter of this year, if it is approved by banking regulators.

At the end of 2020, Equa bank's total assets were EUR 2.8 billion euros. During the same period, Raiffeisenbank reported assets of EUR 15.7 billion.

TEACHER PROFILES

Raiffeisenbank it is one of the five largest domestic banks. It has been providing banking services in the Czech Republic since 1993. The majority shareholder is the Austrian financial institution Raiffeisenbank International. Last year, Raiffeisenbank's net profit fell by 49 percent year on year to CZK 2.14 billion due to the coronavirus pandemic.

In 2020, Equa bank's consolidated net profit fell by 55 percent year-on-year to CZK 182 million. Equa bank is one of the smaller banks. It entered the Czech market in 2011 after Equa Group Limited took over Banco Popolare ČR. 

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