Washington D.C., May 2, 2001
—The International Finance Corporation (IFC) has signed an agreement with UniCredito Italiano (UCI) for the acquisition of 8.8 million shares of Bulbank, equivalent to 5.3% of the share capital of the Bulgarian bank formerly held by the Government, and now controlled by UCI. IFC will invest US$17.5 million for the shareholding acquired, (Euro 19.5 million).
Mr. Khosrow Zamani, IFC Director for Southern Europe and Central Asia said that the successful and transparent privatization of Bulbank is key to both the public's comfort in the privatization process, and to the future impact of this important institution on the local economy. Mr. Zamani added that with the leadership of UCI and the support of IFC, it is expected that Bulbank would increase its lending to Bulgaria’s underserved business and retail sectors, thus supporting economic growth and development.
Bulbank was a showcase privatization for Bulgaria last year, and solicited interest from leading foreign banks as a result of IFC’s efforts to increase investor interest and create a competitive environment for the tender. IFC’s involvement was sought by bidders because of the Corporation’s role as bridge between the public and the private sector, as well as for supporting the development of new financial products in the future.
Bulbank is the largest commercial bank in Bulgaria, with total assets of $1.2 billion (Euro 1.3 billion) at December 31, 2000, and with a net profit of $87.4 million (Euro 95 million) in 2000. Bulbank offers corporate, retail and investment banking services, and has a market share of approximately 26% of total customer deposits, and 9% of total customer loans. The Sofia-based bank is the largest player in trade finance in Bulgaria and has 105 branches.
The mission of IFC (
www.ifc.org
), part of the World Bank Group, is to promote sustainable private sector investment in developing countries as a way to reduce poverty and improve people's lives. IFC finances private sector investments in emerging markets, mobilizes capital in international financial markets, and provides technical assistance and advice to governments and businesses.
