Erste Group Bank has made a significant move in the European banking sector with its acquisition of a 49% stake in Santander Bank Polska for approximately €6.8 billion ($7.7 billion). The all-cash transaction, which also includes the purchase of a 50% stake in Santander’s Polish asset management business for €200 million, marks a key expansion strategy for the Austrian bank. This acquisition will be financed through Erste’s internal resources, with the bank opting to cancel a €700 million share buyback and reduce its dividend payout in order to optimize its balance sheet.
This deal values Santander Bank Polska at €13.88 billion, representing 2.2 times its tangible book value per share. Despite the sale of the majority stake, Santander will retain a 13% holding in its Polish unit. The Spanish bank intends to use part of the proceeds to bolster its organic growth in both Europe and the Americas, aligning with its broader strategic goals. The acquisition also establishes a cooperation agreement between Erste and Santander in corporate and investment banking, enhancing their global payment platform capabilities.
Santander Bank Polska, Poland’s third-largest bank with approximately 7.5 million customers and assets totaling around €81 billion as of 2024, stands to benefit from this strategic collaboration. For Erste, this deal is a step toward expanding its footprint in the Central and Eastern European markets, with the bank expected to leverage the acquisition to gain deeper access to Poland’s growing financial services sector.
The announcement has been met with positive market reactions, with Erste’s shares climbing by 6.46%, while Santander’s stock saw a modest increase of 0.3%. However, shares of Santander Polska dropped around 5% on the Warsaw Stock Exchange following the news.
This strategic partnership between Erste and Santander highlights the ongoing consolidation within the European banking sector, as institutions look to strengthen their market positions and expand their reach. With this acquisition, Erste not only deepens its presence in Poland but also gains enhanced capabilities in the corporate banking and investment sectors, setting the stage for continued growth and collaboration in the European financial landscape.
