European bank M&A tracker: Nordea-Danske deal leads Q3 activity

A €1.55 billion deal involving two of the Nordic region's largest lenders was the biggest European bank M&A transaction in the third quarter, S&P Global Market Intelligence data shows.

Finland-based Nordea Bank Abp agreed in July to buy the Norwegian personal customer and private banking business of Denmark's Danske Bank A/S. The operations had about 285,000 customers, €16 billion of loans and €4 billion of deposits as of 2022-end.

The deal increases Nordea's share of the Norwegian mortgage market to about 16% from 11%, the bank said. Nordea has made several acquisitions in Norway in recent years, including a local unit of French lender Société Générale SA and several pension portfolios.

"We'll get more coverage in regions where we've not historically been strong, and it offers us, we think, good value creation opportunities through clear revenue and cost synergies," Nordea CFO Ian Smith said on an analyst call after the deal was announced.

Danske in June signaled its intention the exit the Norwegian personal customer business as part of a new 2028 strategy, having determined that significant investment would be required to improve profitability and market share.

– Read a transcript of the M&A call for Nordea's latest acquisition. – Access Danske Bank's detailed M&A history. – Use the screener tool to access M&A data.

There were 45 European bank M&A transactions recorded in the third quarter, down from 59 in the year-ago period but broadly in line with volumes so far this year. At current levels, 2023 looks set to be the quietest year for bank M&A since before 2018, Market Intelligence data shows.

Other notable deals during the quarter included BNP Paribas SA's sale of its Czech credit portfolio to local lender Ceská sporitelna a.s. following the withdrawal of its Hello Bank! brand from the market, and Dubai Islamic Bank PJSC's entry into Turkey through the acquisition of a minority stake in digital financial services provider T.O.M. Group.

In the pipeline, UK-based The Co-operative Bank Holdings Ltd. has been put up for sale by its private equity and has drawn an indicative offer from Shawbrook Bank Ltd., Reuters reported.

Another UK lender, Metro Bank Holdings PLC, is in talks to sell up to £3 billion worth of mortgages to shore up its capital following an emergency fundraise.