The government will sell its majority interest in Hungary’s biggest credit union Takarekbank by the end of March 2014. The decision appearing in Tuesday’s national gazette instructs the Minister for National Development to sell the government’s 54 per cent stake for “the highest possible price on the international market”. This is to take place “in accordance with European Union and Hungarian law” but ”mindful of the bank’s internal procedures” and in a manner “beneficial to the bank’s shareholders.”
A committee to be established this week will determine a minimum selling price and organize the sale of the government’s shares. The call for tenders is officially scheduled to take place on 14 January 2014.
Takarekbank was effectively nationalized in June after parliament passed a special law making it possible for the government to impose a new shareholder on the bank–the Hungarian Post Office–without first obtaining the permission of Hungary’s Competition Authority and Financial Services Supervisory Authority.
The government’s decision to acquire a majority interest in a wholly Hungarian-owned financial institution and then offer it for sale to foreign investors comes as a surprise given the prime minister’s repeated calls for more “Hungarian” majority-owned banks. On the other hand, the government stands to make a tidy profit on the transaction by selling for fair market value shares acquired at nominal value through a government mandated increase in Takarekbank’s registered capital.
OTP Chairman and CEO Sandor Csanyi told ATV’s Olga Kalman in September OTP hopes to acquire the government’s shares in Takarekbank.
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