FAIRFIELD, Conn.--(BUSINESS WIRE)--GE (NYSE:GE) has entered into an agreement to sell GE Capital’s majority stake in Bank BPH’s (WSE:BPH) Core Bank to Alior Bank (WSE:ALR). With this transaction, Bank BPH will be transformed into two separate operating units, the Core Bank and the Mortgage Bank, followed by the spin-off and demerger of the Core Bank into Alior Bank. The Core Bank will include the non-mortgage banking assets of Bank BPH and the employees associated with those businesses. The transaction represents ending net investment (ENI) of approximately US$2.1B as of fourth quarter 2015 and is expected to release approximately US$0.2 billion of capital to GE. GE will retain US$3.9B of mortgages (FX and local currency) in the Mortgage Bank unit and BPH TFI, the bank’s asset management business. The transaction is subject to a several conditions including regulatory approvals.
“As we continue to execute on our strategy to sell most of GE Capital’s assets, we are now primarily focused on European transactions,” said GE Capital Chairman and CEO Keith Sherin. “We are pleased to sell the Bank BPH’s Core Bank to Alior Bank, a well-respected bank in Europe which is committed to Bank BPH’s employees and to growing the Core Bank business. We expect to continue to find strong buyers in the coming months for our other European commercial and consumer banking businesses,” he added.
As previously announced, GE is focusing on its high-value industrial businesses and is selling most GE Capital assets. GE will retain the financing verticals that relate directly to GE’s industrial businesses. Since the announcement in April 2015, GE Capital has signed agreements for approximately US$165 billion and has closed approximately US$146 billion of those. In total, GE plans to sell approximately $200 billion of GE Capital businesses worldwide and expects to be largely complete with the process by the end of 2016.
The large majority of Bank BPH’s employees and branch network will join Alior Bank. Alior Bank is a universal bank, providing three million individual and business clients with innovative products and services. It is listed on the Warsaw Stock Exchange and the largest Polish insurer PZU owns a 25% stake in the bank. The transaction, which is expected to close in the fourth quarter of 2016, is subject to regulatory approvals from the Polish Financial Supervision Authority (PFSA), antitrust clearance, a rights issue by Alior Bank, and the demerger/spin-off of Bank BPH’s Core Bank to Alior Bank.
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