Corporate Bank is to hold an initial public offering (IPO) in May of 10 million shares, meaning that it will float 16.6 per cent of its capital on the Bulgarian Stock Exchange (BSE).

A March 12 meeting of shareholders in the bank approved the move. It is intended to enable the bank to raise its capital from 50 million to 60 million leva.

This was the second announcement of an IPO by a bank in May. First Investment Bank intends listing 9.09 per cent of its capital on the BSE.

The moves will bring to six the number of banks listed on the bourse. The others are Economic and Investment Bank, DZI Bank, Central Cooperative Bank and Bulgarian American Credit Bank. However, the acquisition of DZI Bank by EFG Eurobank of Greece is expected to lead to DZI Bank being delisted from the exchange.

Bulgarian-language financial daily Pari said that First Investment Bank stood out among the banks that would be listed on the exchange  because it had featured on every top 10 bank ranking for 2006, regardless of the criteria. Pari said that FIBank occupied the number five spot in terms of assets and the number two spot in terms of commercial loans. As regards to consumer loans and profit, the bank is ranked eighth and tenth, respectively.

On March 21, Pari reported that Greece’s EFG Eurobank had raised its stake in DZI Bank to about 99.6 per cent after buying 5.6 per cent from minority shareholders at 8.71 leva a share. The deal was done through a transfer of the 5.6 per cent shares to Postbank.

Reportedly, about 2.8 million shares changed hands in the deal, which was said to be worth about 24.36 million leva.

Bank Austria Creditanstalt launched in March 2005 warrants of 25 per cent of the share capital of DZI Bank on the Vienna Stock Exchange, which expired on April 6 2006.

“Postbank has bought it (the minority stake) from (HVB Bank) Biochim. There were many shares traded as warrants in Vienna, apparently they, or part of them, were sold in this deal,” SeeNews quoted Krasimir Atanasov, portfolio manager at Elana Fund Management, as saying.

EFG Eurobank bought 74.26 per cent of DZI Bank for 157.8 million euro from Bulgarian financial group DZI in December and subsequently raised its stake to about 94 per cent, buying additional shares on the BSE and in a buyout bid. EFG Eurobank plans, after delist DZI Bank from the BSE, to merge it with Postbank later in 2007 to create the fourth-largest bank by assets in Bulgaria.

In a separate development on March 21, it emerged that Economic and Investment Bank had sold 2.93 per cent of its stake in Elana Fund SPV, thus bringing down its share to 4.04 per cent. The financial institution sold 1.75 million shares, according to a report to the central depository on March 15.

Meanwhile, other significant news was that First Investment Bank had achieved a 36.34 per cent profit increase in 2006. Assets of the bank increased by 24.8 per cent to reach 3.148 billion leva, which meant that the bank ranked fifth in the country.

Consumer and corporate loans were 28 per cent higher than in 2005, reaching a 2006 total of 1.755 billion leva. Deposits were 40.9 per cent higher, to 1.66 billion leva. First Investment Bank is among the leading banks in the international payment processing and corporate financing sectors. It has the second largest ATM network in Bulgaria.