RABAT, Feb 6 (Reuters) - French bank Credit Industriel and Commercial (CC.PA: Quote, Profile, Research) (CIC) raised its stake in Morocco's second-biggest private bank BMCE (BMCE.CS: Quote, Profile, Research) to 19.9 percent from 15.05 percent, the Moroccan bank said on Friday.
"The move illustrates the commitment of the two partners to pursue the close cooperation they had begun in 2004 and develop synergies in technological, retail, investment banking and international fields, namely in Africa," BMCE added.
BMCE said the deal was worth 2.26 billion Moroccan dirhams ($261.1 million).
ADDITIONAL INFORMATION:
"The move illustrates the commitment of the two partners to pursue the close cooperation they had begun in 2004 and develop synergies in technological, retail, investment banking and international fields, namely in Africa," BMCE added.
BMCE said the deal was worth 2.26 billion Moroccan dirhams ($261.1 million).
ADDITIONAL INFORMATION:
On June 15, the Moroccan stock exchange authority, the Conseil Déontologique des Valeurs Mobilières or CDVM decided to suspend trading of BMCE Bank in the Casablanca bourse for two days as the French Crédit Industriel et Commercial, also known as CIC Paris finilized a stake acquisition in the bank The transaction concerned a 10% stake purchase in what is Morocco’s second largest private bank controled by financier Othman Benjelloun. The agreed upon share price was MAD 500, a 16% difference from the MAD 430 per share as priced in the stock exchange, breaking the usual rule that such block transaction should not exceed or fall below 10% of the market’s value. A change in the rule would required a CDVM approval, which apparently endorsed the deal. The deal followed the more recent purchase by Finance.com, also controled by Othman Benjelloun, of 4.9% stake in BMCE previously owned Germany’s Commerzbank. After BMCE and the French savings bank Caisses d’Épargne broke their relationship, BMCE has been looking for a foreign partner and found it in CIC Paris, which will hold one seat at the board of directors. But analysts are already predicting that CIC will likely increase its participation in the Benjelloun empire beyond its acquired 10% and will probably end up buying more stake in the Moroccan bank. For Benjelloun, the choice of CIC was correlated to the trends occuring the banking sector in Morocco. BMCE no longer needs any foreign bank to justify its being but it now needs a strong global parter with which it can do business and more importantly help it compete against other French banks well entranched in Morocco. BMCE Bank is worried about the strength of the new but giant rival Attijariwafa Bank. For CIC, Morocco is not a foreign territory. That financial institution was a key shareholder in a local bank, BCM, controlling some 35% stake from 1971 to 1988. In 1988, the French bank was forced to sale its participation because of its own internal problems. As a result it transferred its stake to the Moroccan private industrial conglomerate ONA, which later sold some of it to the Spanish banking group BSCH. Later, CIC was acquired by the French Crédit Mutuel, joinning one of France’s largest retail banking entities. The entry of CIC into BMCE Bank bodes well for the latter. BMCE is likely to learn from the experience and knowledge of CIC in a wide range of areas that include corporate banking, retail banking, investment banking, small and medium-sized business financing and international transactions. CIC generates 41% of its activity from retail banking and one third of France’s small and mid-sized firm is a client. It maintains a network of 1,846 branches. BMCE for its part is well prepared to offer a wide range of services. It has its Al Wataniya-RMA unit in insurance and it is involved in international transactions with the services it offers to the Moroccan communities residing abroad. It is now working to boost its business with SMBs and will likely increase its loan exposure in that market as a result of the CIC transaction.
