Report: JC Flowers buys Bank Leumi Romania at 50% discount

Romanian lender First Bank, controlled by the American investment fund JC Flowers, derived a profit of some EUR 23 mln from the purchase of Bank Leumi Romania in 2019, according to its 2019 P&L statement, quoted by Ziarul Financiar.

First Bank bought a 99.9% stake in Bank Leumi Romania RON 90.5 mln (EUR 19 mln).

Separately, the fair value of Bank Leumi's net assets was RON 203.2 mln (EUR 42 mln), resulting in a RON 112.7 mln (EUR 23 mln) gain for First Bank from the transaction.

"At the acquisition of Bank Leumi, on July 10, 2019, the fair value of the acquired net assets, adjusted for the First Bank share, was RON 203.2 mln established based on the acquisition price allocation report prepared by an external expert, and the consideration paid was RON 90.5 mln. The gain from the acquisition of Leumi Bank, determined as the difference between the price paid and the fair value of Leumi Bank's assets and liabilities, amounting to RON 112.7 mln, was recognized in the consolidated statement of profit or loss for the group for the period ended December 31, 2019," according to First Bank's report.

The group reported a consolidated net profit of RON 119 mln (EUR 24.8 mln) in 2019, compared to losses of RON 28.3 mln in 2018.

(Photo courtesy of the company)