KOMMERSANT. Orient Express Bank said on Thursday it had acquired 100% of Gorodskoi Ipotechny Bank (GIB) from Morgan Stanley. “This deal was struck within Orient Express Bank’s expansion strategy based on M&As," said the bank’s press release, which Kommersant business daily quoted. According to Orient Express Bank board member Kirill Nifontov, the deal was finally closed yesterday. He declined to disclose the transaction price. Morgan Stanley declined to comment on the sale of Gorodskoi Ipotechny Bank.
Orient Express Bank’s interest in GIB is driven by the fact that “since the beginning of the year mortgage lending has grown the most among all retail lending operations”, the bank said in the press release. Orient Express Bank finalized last June its reorganization through the takeover of Etalonbank and Bank Dvizhenie in October 2009. In March 2010 Kamabank’s takeover was approved. Orient Express Bank will hold a shareholders meeting on July 6 that will decide whether or not to take over Rostpromstroybank.
For the record, Morgan Stanley bought GIB in spring 2007 from Daniil Khachaturov, the owner of Rosgossstrakh. The transaction price was not named, but experts believe the price tag was around $200 mln. In May 2008 Morgan Stanley began to seek buyers for its mortgage subsidiary as part of the plan to divest non-priority assets. However, the crisis cooled investor interest in banks, especially those that specialized in mortgage lending. While Morgan Stanley looked for buyers, the quality of the asset deteriorated. As experts estimate, Orient Express Bank could pay to Morgan Stanley the amount of 3 times lower than what Morgan Stanley had paid for the asset initially, around $64 mln.
