The steering committee for the sale of a 69% stake in Slovakia's second largest bank, Všeobecná úverová banka (VÚB), June 13 received offers from the only two bidders, Italy's IntesaBci and French bank Societe Generale.
The Finance Ministry's Bank Privatisation Unit said before the bids were offered that it believed VÚB could attract a similar price to that offered for Slovakia's largest bank, Slovenská sporiteľňa (SLSP), by Austria's Erste Bank in December.
Erste paid 18 billion crowns for an 87% stake in the finance house, meaning the offer for the VÚB stake would be around 14 billion crowns.
Some observers in the banking sector believe that following the Italian bank UniCredito's acquisition of the Slovak finance house Poľnobanka last year, the government will be keen to bring a bank from a different European nation into Slovakia.
"They'll prefer French capital. Societe generale is a good, well-respected bank," said one Slovak banker.
However, IntesaBci has said that if it wins the tender it will look to attract more Italian firms to Slovakia with it, a shot in the arm for foreign investment which the government would be anxious to receive.
Its directors also say that they will look to expand VÚB's retail operations. Všeobecná currently dominates the lending market with a 27% share, but concentrates most of its banking activities on the corporate sector.
IntesaBci Director Adriano Arietti told The Slovak Spectator on the eve of the bids' submission that he expected a decision on the tender from the government within a week.
"It's all in the hands of the government now. We've done our part," he said.
The submissions come only days after a separate steering committee returned an offer from Hungarian Bank OTP for the state's 70% stake in another bank, Investičná a rozvojová banka (IRB). The Privatisation Ministry declined to say why the offer was returned, however it is believed that the price bid was unacceptable for the ministry.
IRB was put under forced administration in 1997 after running into serious financial problems, and despite having that administration lifted in 1999, has been viewed as the least attractive of the three major state banks which have been offered over the last twelve months. OTP was the only investor the bank attracted.
The bank ended the first quarter of this year 47 million crowns in the red, an improvement of 129.9 million crowns year-on-year, but a fall-off from the 24 million crown profit it recorded for 2000.
It was also at the centre of a recent scandal over a tender for supply of an e-banking system. Alleged irregularities in the tender led to the dismissal of senior board members at the bank, including its president.
The sale of the two banks would be the final realisation of the government's restructuring of the sector.
In 1999 cabinet announced plans to sell off the state's three biggest finance houses, cleaning up their loan portfolios in the process. The entire project cost the state 100 billion crowns and involved the transfer of non-performing and classified loans from the finance houses, the majority of that figure being taken from VÚB.
The government is trying to sell off some of the loans through its hospital bank Slovenská Konsolidačná.
