Kuwait’s Al Ahli Bank will pay $150 million for a 98.5 percent stake in the Egyptian unit of Greece’s Piraeus Bank, using its own cash resources to support a regional expansion drive, it said on Thursday.
Kuwait’s seventh-largest bank by assets said the deal required approvals from the central banks of Kuwait and Egypt.
“(Buying it) will cost us $150 million, which is not a great sum for us. We will finance the deal from our sources,” Fawzy al-Thunayan, general manager of board affairs at the bank, told Reuters.
Thunayan added the deal would help with the bank’s regional expansion, but declined to talk about specific plans for Piraeus Bank Egypt.
Piraeus Bank Egypt, which was bought by the Greek lender in 2005, has 39 branches and total assets worth 9.66 billion Egyptian pounds ($1.27 billion) at the end of March, according to its website.
Al Ahli Bank, with assets worth 3.58 billion dinars ($11.86 billion), has branches in Kuwait and the United Arab Emirates, according to its website.
Both lenders stand to benefit from the transaction.
Greek banks have been offloading assets as they seek to cope with the country’s debt crisis, with concerns increasing in recent weeks that banks’ liquidity is drying up as Greece’s government tries to renegotiate with its creditors.
For the Kuwaiti lender the deal is the latest in the North African country by Gulf Arab banks looking to expand beyond their highly competitive domestic markets and increase their profitability.