Lebanon Businessnews News

Fransabank acquires
Ahli Bank Lebanon
Deal valued at $100 million+
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Fransabank fully acquired the operations of Ahli International Bank in the local market through a deal valued $103-107 million, according to a banking source close to the deal. The bank is part of the Jordan-based Al-Ahli bank.

“Ahli Bank was sold because it was compelled to meet its Capital Adequacy Ratio, and therefore bring more liquidity. It opted not to do that,” the source said. According to the source, the deal had the verbal blessing of Central Bank Governor Riad Salameh.

The Price-to-Book Ratio is around 1.3-1.35 depending on a number of factors including the valuation of the bank’s headquarters located in downtown Beirut, the protocol with employees, and the terms of a soft loan to be obtained from the Central Bank (BDL).

Other banks that competed on the deal was IBL bank, which withdrew early, and Byblos Bank which was a finalist. “Fransabank bought Ahli since it doesn’t have any problematic debt. The deal has good added value and growth potential,” the source said.

Non consolidated total assets of Ahli reached $787 million in 2013. Deposits were $670 million. Loans totaled $220 million. There would be no change of Fransabank ranking as part of the top ten banks for non consolidated figures as of end 2013.

Fransabank will remain in fourth place with total consolidated assets of $17.79 billion, but will move forward to the third place in terms of consolidated deposits with $14.79 billion. It will remain in third place in terms of loans with $5.5 billion.

The number of total branches will reach 75 branches, up from 66 branches, as Ahli operates nine branches locally. Fransabank will be ranked third instead, up one place. Ahli had 185 employees.

“The deal is expected to be officially approved by the BDL in less than two months,” the source said. A full merger of the two banks will be implemented after that.


Reported by Leila Rahbani
Date Posted: May 14, 2014
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