Brokers took this as a sign that some shareholders are increasingly interested in selling their participation, as they want to take advantage of the capital market momentum. Amid these rumors, the bank’s shares surged as much as 14 percent yesterday on the Bucharest Stock Exchange (BVB), where it is listed.
Banca Transilvania is one of the few local lenders that have not been taken over by international players. In recent years, rumors about a possible takeover of the bank were often heard, but they were denied every time by the bank’s management. Contacted by Business Standard to comment on the current rumors, Banca Transilvania President, Horia Ciorcila, who is also the bank’s largest individual shareholder, said that “if anything happens, we will make it public in due time.” He added that the suggestion to remove the 5 percent threshold came from some Romanian shareholders who own more than 5 percent of the bank. “They are Romanian investors, not foreign. I am not part of those who came up with the proposal, but I cannot provide details about their names, because this information is confidential,” Ciorcila said.
According to the bank’s by-laws, no shareholder may own more than 5 percent of the bank’s share capital without approval of the shareholders’ meeting. To date, the European Bank for Reconstruction and Development (EBRD) is the only shareholder allowed to exceed this threshold, owning 15 percent of Banca Transilvania’s shares. If shareholders eliminate the threshold, any investor who owns more than 10 percent of the lender will require approval of the National Bank of Romania (BNR).
Stock market analysts say that chances for the sale of a larger package of Banca Transilvania shares are higher now, given that some investors want to take advantage of good capital market evolution at this time. The value of Banca Transilvania was close to €2 billion in 2007, but it plunged to €300 million following the sharp corrections registered by the capital markets due to the international financial crisis. “The proposal to remove the ownership threshold could be an indication of a stronger desire to sell, after losing the 2007 momentum, when price evaluation was high,” according to Raiffeisen Captital&Investment analyst, Alexandru Combei. He added that this is a good time for capital markets, as investors are beginning to see things brightening and those who want to sell could take advantage of this wave of optimism. “However, there is a risk that this time will pass quickly and prices will drop again,” he added.
