EBA欧洲银行-7-April-2016-28EBA-2016-E-6582920ANNEX-to-letter-Central-Bank-of-Hungary-to-Andrea-Enria_2页_93kb

Summary of Decision No. H-SZN-I-23/2016 of the Central Bank of Hungary on the Sale of Business Tool in the Resolution of MKB Bank Zrt.

Core Content

The decision No. H-SZN-I-23/2016 of the Central Bank of Hungary (MNB) outlines the process and outcome of the sale of MKB Bank Zrt. under the resolution framework. The sale was initiated as part of the resolution process for the bank, which was placed under resolution on 18 December 2014 by MNB, acting as the designated national resolution authority.

Key Information

• Bank Details:

  • Name: MKB Bank Zrt.
  • Seat: 1056 Budapest, Váci street 38.
  • Company Register: Budapest-Capital Regional Court of Appeal
  • Company Register No.: 01-10-040952

• Resolution Context:

  • The sale of the bank was mandated by the European Commission's decision SA.40441 (2015/N) dated 16 December 2015.
  • The sale process must comply with the principles of openness, transparency, competitiveness, and non-discrimination, aiming to maximize the purchase price.
  • The process aligns with EU regulations on State aids and the BRRD (Directive 2014/59/EU).

• Sale Process:

  • Financial Advisor: J.P. Morgan Limited acted as the financial advisor for the seller.
  • Advisors: Other advisors were also involved.
  • Non-Binding Offers: In the initial phase, seven non-binding offers were received.
  • Due Diligence: Investors had access to legal, business, and financial data via a virtual data room, following international practice.
  • Binding Bids: Binding bids were due by 22 February 2016.
  • Winning Bid: Three binding bids were received, and the highest purchase price of HUF 37 billion was selected by MNB.
  • New Owners: The winning syndicate consists of Blue Robin Investments S.C.A., METIS Private Capital Fund, and Pannonia Pension Fund (member of CIG Partnership), with ownership shares of 45%, 45%, and 10%, respectively.

Main Views

• Compliance with EU Regulations:

  • The sale process strictly adhered to the European Commission's competition law and the BRRD directive.
  • The MNB ensured that the sale of business tool was in line with the Hungarian Resolution Act, which transposes the BRRD criteria.

• Selection Criteria:

  • The MNB developed and applied selection criteria in cooperation with an international consultant firm.
  • The criteria were based on objective foundations and aligned with international best practices.
  • They were communicated to bidders in advance to ensure transparency.
  • While the purchase price was a decisive factor, financial stability considerations were also taken into account.

• Impact on Customers:

  • The decision does not affect retail customers of the Bank.
  • It is a necessary legal provision to support the planned resolution actions and the European Commission's State aid decision.

Conclusion

The sale of MKB Bank Zrt. was conducted in accordance with EU and Hungarian legal frameworks, emphasizing transparency, competition, and the maximization of purchase price. The winning bid was selected based on objective criteria, ensuring the resolution process was both legally compliant and economically efficient. The new ownership structure is expected to contribute to the financial stability of the institution while safeguarding the interests of its customers.