Leumi’s board decided to sell its 99.91% stake in Bank Leumi Romania SA to as part of its strategy to concentrate its international operations in main financial centers through its subsidiaries in the US and the UK.
The signing of a binding deal is subject to the completion of due diligence, further negotiation and regulatory approvals.
Leumi entered the Romanian market in 2006, when it took over Eurom Bank for $34 million. Bank Leumi mainly funds real estate projects, projects by Israeli citizens and small and medium-sized companies in Romania.
The local unit returned to profit in 2016, with a net earning of RON12 million, after a loss of around RON25 million in 2015. In 2016, the bank sold a non-performing loan package that generated revenue of RON18.4 million. Without this portfolio clean-up, the bank would have posted a loss of RON5.7 million.
For 2017, Bank Leumi Romania expects a profit of RON12.5 million.