Sovcombank completes merger with HCF Bank

MOSCOW. April 7 (Interfax) - Sovcombank has completed the merger with HCF Bank (operating under the Home Bank brand).

As of today, HCF Bank has ceased to exist as a separate legal entity, Sovcombank said in a statement.

The integration of the two banks took 11 months.

At the time of the deal, HCF Bank had 3 million active clients, a retail loan portfolio of 202 billion rubles and a deposit portfolio of 169 billion rubles. "Thanks to the deal, Sovcombank avoided significant expenses on organic customer acquisition, lending and deposit gathering. The total savings are estimated at several billion rubles," Sovcombank said.

A total of 3,000 HCF Bank employees transferred to Sovcombank. Sovcombank's retail network expanded by 84,000 POS loan issuance points as a result of the merger.

The transaction was carried out in two stages. In the first stage, Sovcombank acquired 10% of HCF Bank for cash; in the second stage, it acquired the remaining 90% by issuing 1.8 billion new shares. The former owners of HCF Bank, who received Sovcombank shares as payment, agreed not to sell the securities for six months following the deal's closing. Following this lock-up period, Sovcombank's free float will increase.

It was previously reported that the positive financial result from acquiring HCF Bank amounted to 19 billion rubles.

As part of the merger, Sovcombank planned to issue 1,822,283,030 ordinary shares with a nominal value of 0.1 ruble each. The total nominal value of the issue was 182.2 million rubles.

Sovcombank's current charter capital stands at 2.069 billion rubles, consisting of 20,693,945,875 ordinary shares with a nominal value of 0.1 ruble each. After the registration of the results of the additional issue, the capital will increase 8.8% to 2.252 billion rubles.

Sovcombank announced its intention to acquire HCF Bank in mid-February 2024.

HCF Bank was formerly a subsidiary of Czech group PPF. PPF exited the bank's capital in 2022, selling 50% of its stake to Russian investors led by former RTS head Ivan Tyryshkin, and the remaining 50% to the bank itself.

Sovcombank ranked eighth in the Interfax-100 ranking by assets in 2024. HCF Bank ranked 28th.