“In 2006 we bought BCR. We haven’t got punished by the markets, although it was by far our most expensive acquisition. But we got punished by reality,” Treichl told investors at a conference call.
Erste paid EUR3.75 billion for 61.88% in BCR, Romania’s largest lender by assets. It subsequently raised its stake into the local lender to 82%.
“When the financial crisis severely affected the central and eastern Europe, our expensive acquisition turned into a very expensive venture,” Treichl added.
However, time could still show that BCR was a lucrative acquisition for Erste, just like in the case of its subsidiaries in the Czech Republic and Slovakia, he said.
He said Erste has received a lot of negative feedback from the markets after it purchased the two units.
“Ten years later, people tell us: Why doesn’t your whole bank looks like the banks you have in the Czech Republic and Slovakia? … Who knows, five years from now, there will be investors will be asking us: Why doesn’t your whole bank look like the bank that you have in Romania?” the Erste official said.
BCR reported a net profit of 67.6 million lei (EUR15.6 million) in the first nine months, down sevenfold on the year, after it swung to a loss of RON90.5 million in the third quarter.