The acquisition, which is subject to regulatory approval in Croatia and Austria, is expected to close in the first quarter of 2007. According to Erste Bank, it will provide substantial synergies for the company’s consumer finance sector as well as an increase in its CEE-related commission income base.
Diners Club Adriatic (DCA), Croatia’s second largest credit card provider, has a market share of 28.9% and recorded total revenues of E50 million in 2005. According to Erste Bank, the combined bank card businesses of Erste Bank Croatia and DCA will amount to more than one million bank cards.
Erste Bank also said that the addition of 140,000 new clients as a result of the acquisition will bring its customer base in Croatia to about 740,000, leading to a significant increase in cross-selling opportunities.
Erste Bank Croatia’s strength in retail banking and its performance-oriented culture together with the well-known Diners Club brand and credit card industry expertise places the newly acquired company in an excellent position to further improve its market share and profitability, Erste Bank stated in a press release.
Erste Bank beat Hungary’s OTP Bank in the bidding for DCA, after OTP submitted an offer in September 2006. The Hungarian lender has since revealed plans to focus on the consolidation of acquired assets in 2007.
