France Bank Mergers & Acquisitions (BNP Paribas)

Photo: A BNP Paribas pocket notebook and pen kit that forms part of my banking item collection.

BNP Paribas S.A.

BNP Paribas was formed in 1999 by the merger of Banque Nationale de Paris S.A. and investment bank Paribas S.A.

Banque Nationale de Paris

In 1966, the French government combined two of the four state-owned banks, Comptoir National d'Escompte de Paris and the Banque Nationale pour le Commerce et l'Industrie, into the new Banque Nationale de Paris (BNP).


Comptoir National d’Escompte de Paris (CNEP)

In 1848, a political and economic crisis hit France and many private bankers went bankrupt following yet another revolution. The government of the Second Republic intervened and established the Comptoir National d’Escompte de la ville de Paris (literally, the National Discount Counter of the City of Paris) to provide banking service for businesses in major towns. In 1851, the bank shortened its name to Comptoir National d’Escompte de Paris. This was further changed to Comptoir d’Escompte de Paris (CEP) in 1853 when the French state relinquished control.

Interestingly, in 1860, CEP opened its first international office in Shanghai, as the bank acted as the state collection agent of war indemnities owed to France by Imperial China. From 1860 to the 1880s, the bank also opened offices in Reunion Islands, Calcutta (Kolkata), Bombay (Mumbai), Hong Kong, Saigon (Ho Chi Minh City), London, Yokohama, Alexandria, Melbourne and Sydney to provide trade financing for French industries.

In 1887, the bank’s management was embroiled in a major scandal that caused a bank run. When it became clear the bank had become insolvent, the French state injected cash and the bank restored its old name of Comptoir National d’Escompte de Paris (CNEP). CNEP became a limited-liability company in 1889.

Between the 1910s and 1920s, CNEP greatly expanded its national branch network and became the third largest bank in France by 1929. The bank, partly due to its strong retail deposit base, survived the Great Depression and World War II relatively unscathed.

When peace returned in 1945, the de Gaulle government nationalized the Banque de France, plus the Big Four retail banks: Banque Nationale pour le Commerce et l’Industrie, Comptoir National d’Escompte de Paris, Crédit Lyonnais and Société Générale. The nationalization was part of the plans to coordinate the nationwide re-building efforts.

In the 1950s, CNEP lost its operations in Egypt and scaled back from Tunisia as the rise of nationalism in some former French colonies forced out foreign businesses.


Banque Nationale pour le Commerce et l’Industrie
(Comptoir National d’Escompte de Mulhouse, Banque Nationale de Crédit, Banque Française pour le Commerce et l’Industrie)

In the same year that CNEP was founded by the French state, a smaller counterpart, the Comptoir National d’Escompte de Mulhouse (CNEM) was established in Mulhouse, in the region of Alsace. In 1854, CNEM was no longer under state control and was renamed Comptoir d’Escompte de Mulhouse (CEM).

During the 1850s and 1860s, CEM rode on the industrializing economy and opened offices in other principal towns, including Lyon, Marseille, Le Havre and Paris.

In 1870, France found itself at the losing end of a war and lost the region of Alsace-Moselle to Germany. This created a major complication for CEM: it had now become a French bank operating in a German region. As France and Germany continued to dispute the ownership of Alsace over the next 40 years, CEM in 1913 finally decided to re-group its larger operations in France proper into a subsidiary called Banque Nationale de Crédit (BNC). Parent company Comptoir d’Escompte de Mulhouse operating within German-controlled Alsace, now actually only had three branches. Despite their parent-subsidiary relationship, the Comptoir and Banque Nationale de Crédit agreed to avoid doing business in each other’s domain.

In the 1910s, Banque Nationale de Crédit grew quickly by absorbing more than 30 other banks. And in 1922, the bank took over Banque Française pour le Commerce et l’Industrie (founded 1901), a bank that had financed France’s public utilities, railway and heavy industries, but was in need of new capital at the time of merger.

The end of World War I saw France re-gaining control of Alsace-Moselle, but this didn’t solve the CEM-BNC complication even though both were operating in France once again. Their prior non-competition agreement meant that the parent company CEM still could not operate anywhere in France outside of Alsace-Moselle. Animosities between the two banks became so bitter that Comptoir d’Escompte de Mulhouse sold its stake in BNC in 1918.

By 1930, however, Comptoir d’Escompte de Mulhouse realized that its home market of Alsace-Moselle was too limiting, and agreed to be acquired by its former subsidiary Banque Nationale de Crédit. The good times didn’t last for BNC, however, for the bank soon got into severe financial difficulties during the 1930s Depression. A state guarantee on the bank’s deposits failed to stem depositors from withdrawing their money and between April and December, 1931, Banque Nationale de Crédit’s share price fell 96%. The bank soon collapsed and was rescued by the government, which re-structured it into the Banque Nationale pour le Commerce et l’Industrie (BNCI) in 1932. Throughout the 1930s, BNCI also absorbed other ailing banks.

World War II significantly restricted BNCI’s domestic operations, and the bank turned its attention to the French overseas colonies and territories, such as Algeria, Morocco, Ivory Coast, Cameroon, the Congo, Senegal, Madagascar, Reunion Islands and the French West Indies. However, the “de-colonialization” in the 1950s and 1960s saw the French bank retreating from many former colonies.

In 1945, BNCI, along with three other big commercial banks and the Banque de France, were nationalized by the French government. Between 1945 and 1959, the Big Four hardly opened any new branches under state control.

In 1966, the French government merged two of the Big Four state-owned banks, the Comptoir National d’Escompte de Paris and the Banque Nationale pour le Commerce et l’Industrie to form the new Banque Nationale de Paris (BNP). The new bank combined CNEP’s stronghold in retail banking with BNCI’s expertise in corporate and international banking. In 1972, BNP and seven other European banks jointly created the Associated Banks of Europe Corporation (ABECOR) that specialized in medium-term financing. In 1979, BNP acquired a significant minority stake in BancWest Corp. (Bank of the West) of California. BancWest in 1998 acquired First Hawaiian Bank.

In 1993, the French government finally privatized Banque Nationale de Paris.


Paribas (originally Banque de Paris et des Pays-Bas)

Paribas itself can trace its origins to two banks: Banque de Crédit et de Dépôt des Pays-Bas (Bank of Credit and Deposit of the Netherlands) and the Banque de Paris. Of the two, the Banque de Crédit et de Dépôt des Pays-Bas was older, having been founded in Amsterdam in 1863. The bank was established by a private banker family with connections in the Netherlands, France, Belgium and Germany. The bank soon opened branches in Paris, Brussels, Antwerp and Geneva.

In 1869, the Banque de Paris was established with French, Belgian and Danish capital. The two banks merged in 1872 to form the Banque de Paris et des Pays-Bas (the Bank of Paris and the Netherlands). Right from its beginning, the bank has had a strong position in the investment underwriting business, and during its first year of existence, helped float a three-billion francs debt issue for the French government.

Between 1872 and 1913, Banque de Paris et des Pays-Bas became an international power house in underwriting sovereign loans for nation states, including France, Belgium, the French and Belgian colonies, Imperial Russia, Morocco, the Balkan states, the Scandinavian nations, and Latin American countries.

Acting also as a merchant bank, Banque de Paris et des Pays-Bas took equity interests in numerous French and foreign companies in the railway, electric utilities, tramway, iron and steel, and chemicals industries. The bank also at one point held interests in numerous banks, including Banco Español Credito (Spain), Banca Commerciale Italiana, Banque Russo-Asiatique (a leading bank in Russia at the time), as well as other banks in Bulgaria, Romania, Serbia, Egypt, Turkey, Morocco, Canada and Japan.

Following the 1917 the Bolsheviks revolution, however, the new regime confiscated all foreign businesses in Russia, and refused to honour the debts incurred during the Tsarist era. Some estimates put France’s total losses in Russia to be USD $4-billion. During the 1930s Great Depression, as demand for international financing dwindled, the bank retreated to its home markets of France, Belgium and the Netherlands.

France itself was devastated during World War II, and the Sovietization of Eastern Europe following the war further shrunk Banque de Paris et des Pays-Bas’ international operations. In 1945, under General de Gaulle’s government, France nationalized Banque de France plus the Big Four commercial banks to co-ordinate re-building efforts. The nationalized Big Four focused on channeling shorter-term savings into supporting state treasury issues. As a merchant and investment bank, Banque de Paris et des Pays-Bas escaped the government intervention and remained a private-sector concern.

Throughout the 1950s and 1960s, the bank provided crucial financing to rebuild France’s industries across a wide spectrum, and to facilitate French exports. The bank opened an office in New York in 1960, to be followed by others in London, Luxembourg, Moscow, the Middle East and the Far East throughout the next 20 years.

Following a major policy shift by the French government, consolidations in the banking sector heated up in earnest. Between 1966 and 1973, Banque de Paris et des Pays-Bas gradually acquired majority control in another merchant bank, the Compagnie Bancaire. In 1968, the bank acquired French retail bank Crédit du Nord. In the same year, Banque de Paris et des Pays-Bas and rival Compagnie de Suez fought over the control of CIC (Crédit Industriel et Commercial). The fight only ended in 1971 when Suez took over CIC but gave up Banque de l’Union Parisienne to Banque de Paris et des Pays-Bas.

The bank became a major player in the Eurobond (foreign-currency bonds issued in Europe) market during the 1970s in co-operation with British trading house S.G. Warburg. At the same time, it expanded into asset management and wealth management for the first time.

When a new socialist government under Pierre Mauroy took power in 1981, Banque de Paris et des Pays-Bas, along with 39 other banks and another financing firm Suez, were nationalized. At the same time, the bank’s name was changed to Compagnie Financière Paribas, Banque Paribas. The short name Paribas actually had been the bank’s telegraph address since the beginning of the 20th century. Another shift in France’s ever-changing political wind meant that in 1987, Paribas was privatized and floated back on the stock market, with AXA (French insurer), Power Corp. (a Canadian financial conglomerate), Sumitomo Life (Japan) and Kuwait Investment Authority amongst its strategic institutional shareholders.

In 1997, Paribas decided to return to its corporate and investment banking root and sold its French retail banking unit, Crédit du Nord, to rival Société Générale, for FRF 2.2-billion (USD $420-million). Crédit du Nord had 600 branches. Paribas then sold its Belgian and Dutch retail banking operations to Belgium’s Bacob-Arco Group (which became Dexia). In the same year, Compagnie Financière Paribas, Banque Paribas and majority-owned subsidiary Compagnie Bancaire decided to fully integrate into a new entity called Paribas S.A.

In early 1999, Paribas agreed to a 15.0-billion (USD $17.0-billion) buyout offer from Société Générale. Not wanting to be left behind, however, rival Banque Nationale de Paris made a hostile USD $21.o-billion counter-offer for Paribas, and an unimaginable, separate USD 19.6-billion offer for Société Générale (SocGen). BNP’s three-way merger proposal would have created the world's largest bank.

Uncertainties surrounding BNP’s insane ambition resulted in a drop of its share price, reducing the combined value of the offers for Paribas and SocGen to USD $38.0-billion. For months, all three banks engaged in a public relations battle in an attempt to win support from the public, shareholders and the French banking regulator. In the end, BNP succeeded in breaking SocGen and Paribas' merger plan, and acquired Paribas to form BNP Paribas. However, it could only secure 31.5% of SocGen's shares. The French banking regulator eventually vetoed BNP's merger plan to acquire Société Générale.

Recent transaction(s):

• In 2001, BNP Paribas bought the 55% of BancWest Corp. in the U.S. that it didn’t already own. BancWest owned Bank of the West in California and First Hawaiian Bank.
• In 2002, BNP Paribas bought United California Bank for USD $2.4-billion from UFJ Holdings of Japan.
• Also in 2002, BNP Paribas bought a 10.9% holding in Crédit Lyonnais S.A. from the French government for Eur 2.2-billion. Following a ruling by the French court in 2003 denying BNP Paribas' proposal to take over Crédit Lyonnais, BNP Paribas sold its minority stake in Crédit Lyonnais to Crédit Agricole S.A.
• In 2004, BNP Paribas bought Community First National Bank for USD $1.2-billion. Fargo, North Dakota-based Community First National operated 155 branches in 12 Midwest states.
• In 2005, BNP Paribas' BancWest Corp. subsidiary bought Omaha, Nebraska-based Commercial Federal Corp. for USD $1.36-billion. Commercial Federal Bank had 198 branches across the U.S. Midwest.
• In 2006, BNP Paribas bought Italian bank Banca Nazionale del Lavoro (BNL) for Eur 9.0-billion (USD $11.3-billion). This followed the Bank of Italy's veto of Unipol Assicurazioni's bid for Banca Nazionale del Lavoro.
• In 2007, BNP Paribas agreed to purchase 19% of Libya's Sahara Bank from Libya's central bank for Eur 145-million (USD $200-million). BNP Paribas would take over the operational control of the bank, and retained the right to take up 51% of the bank by 2012.
• In 2008, BNP Paribas bought Bank of America's hedge fund servicing prime brokerage unit for a reported USD $300-million (Eur 194-million). The unit has about 500 hedge fund clients.
• Following months of legal challenges and negotiations between Fortis shareholders, BNP Paribas, and the French, Belgian and Luxembourg governments, BNP Paribas in March 2009 agreed to acquire 75% of Fortis Bank Belgium and 25% of Fortis Insurance Belgium for Eur 9.625-billion (USD $12.25-billion). In addition, BNP Paribas also acquired a direct 16% stake in BGL (Fortis’ Luxembourg operations) for Eur 831-million (USD $1.06-billion). BNP Paribas controlled another 50% of BGL through 75%-owned Fortis Bank Belgium. Click here for details of Fortis’ collapse and the transactions.
• The purchase gave BNP Paribas 1,458 Fortis branches in Belgium, Luxembourg, Poland, Turkey, France, and other countries except the Netherlands. It would also gain more than Eur 239-billion of customer deposits, propelling BNP Paribas to become the largest bank in the Eurozone based on deposits.
• In October 2008 and March 2009, the French state injected a total of Eur 5.10-billion into BNP Paribas in return for non-voting shares of the bank.
• In September 2009, BNP Paribas raised Eur 4.3-billion (USD $6.27-billion) from a rights issue to repay the government the Eur 5.10-billion bailout funds.
• In November 2009, BNP Paribas’ Fortis Bank unit sold its 49% stake in Chinese fund manager ABN AMRO TEDA Fund Management for Eur 105-million (CAD $156-million, HKD $1.2-billion) to Canada’s Manulife Financial. BNP inherited the ABN AMRO TEDA stake from Fortis, which acquired parts of Dutch banking ABN AMRO Holding in 2007.
• In December 2012, BNP Paribas agreed to sell its 95.2% stake of BNP Paribas Egypt to Emirates National Bank of Dubai (Emirates NBD) for USD $500-million (Eur 378-million).  BNP Paribas Egypt had a network of 69 branches.
• In December 2013, BNP Paribas bought 98.5% of Poland's Bank BGZ from Rabobank of the Netherlands for PLN 4.2-billion (Eur 1.0-billion, USD $1.37-billion).  BGZ operated about 400 branches in Poland.
• in April 2016, BNP Paribas's American retail banking subsidiary BancWest Corp. floated part of the First Hawaiian Bank by selling 24.25-million shares. The IPO raised USD $557-million for the French bank. BNP Paribas continued to fully own Bank of the West's operations in contiguous United States.
• In April 2018, BNP Paribas' Polish subsidiary BGZ BNP Paribas agreed to buy the core banking operations of Raiffeisen Bank Polska for PLN 3.25-billion (EUR 775-million). Raiffeisen Bank Polska had a corporate and retail loan portfolio of PLN 19-billion (EUR 4.5-billion) and client deposits of PLN 34-billion (EUR 8.1-billion).
• Between May and July 2018, BNP Paribas sold another 28.6% of First Hawaiian Bank for USD $1.06-billion, decreasing its holding of the American bank to 33.3% from 61.9%.
• In December 2021, BNP Paribas announced that it was selling its San Francisco-based Bank of the West to Canada's Bank of Montreal for EUR 14.4-billion (USD $16.3-billion, CAD $21.07-billion) in cash. Bank of the West served 1.8 million clients through 514 branches in 24 states (primarily in the U.S. West Coast and Midwest) with 9,000 employees. The bank had US$56 billion of loans and US$89 billion of deposits.
• In April 2024, BNP Paribas agreed to acquire Fosun Group’s 9% shareholding in Belgian insurer Ageas for around  EUR 730-million. BNP Paribas and Ageas have been partners for many years via the joint shareholding of  AG Insurance (75% owned by Ageas and 25% by BNP Paribas Fortis). BNP Paribas Fortis is a longstanding distribution partner to the AG Insurance’s Belgian insurance activities.

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France Bank Mergers & Acquisitions (Société Générale)

Photo: One of Société Générale's London offices near the Tower of London. Photo was taken during my trip to London in 2007.


Société Générale S.A.
(Also known as SOCIETE GENERALE, SocGen)

Société Générale was established in 1864 by an imperial decree signed by Napoleon III. Its full name at the time was Société Générale pour Favoriser le Développement du Commerce et de l'Industrie en France. As the name suggests, the bank’s mandate was to promote large, long-term commercial and industrial development.

At the end of World War II, Société Générale, along with Crédit Lyonnais, Comptoir National d'Escompte and Banque Nationale pour le Commerce et l'Industrie were nationalized in 1945 by the French government to stabilize the fiscal and monetary systems. In 1987, SocGen (as it's often referred to as) became the first of the Big Three banks to be floated on the stock market.

In February 1998, SocGen acquired New York-based investment bank Cowen & Company for USD $540-million. Cowen specialized in the health care, technology and communications industries. The business was renamed SG Cowen Securities after being merged with SocGen's existing American investment banking operations.

In March 1999, SocGen entered into an agreement to merge with investment bank Paribas S.A. in a Eur 17.0-billion (USD $17.7-billion) transaction. However, Banque Nationale de Paris (BNP) also aspired to expand and soon made a hostile Eur 19.8-billion (USD $21.o-billion) counter-offer for Paribas, and a separate Eur 18.5-billion (USD 19.6-billion) offer for Société Générale itself. Had BNP succeeded, the three-way merger would have created the world's then biggest bank with assets of over USD $1-trillion.

In June 1999, Société Générale raised its offer for Paribas to Eur 20.3-billion (USD $21.1-billion). Meanwhile, the uncertainties about the messy bidding war resulted in a drop in BNP's share prices, lowering the combined value of its offer for Paribas and SocGen to Eur 36.0-billion (USD $37.9-billion). For months, all three banks engaged in a public relations battle in an attempt to win support from the public, shareholders and the French government. In the end, BNP succeeded in breaking SocGen and Paribas' merger proposal, and acquired Paribas to form BNP Paribas S.A. However, it could only secure 31.5% of SocGen's shares. Following a court battle, the French banking regulator ruled that BNP's stake in Société Générale was below the controlling threshold. Furthermore, BNP was instructed to give up its stake in SocGen, essentially vetoing BNP's three-way merger plan.

In recent years, Société Générale has been focusing on the Central and Eastern European (CEE) market.

Recent transaction(s):

• In 1999, Société Générale (SocGen) bought 97.95% of Bulgaria's Expressbank AD.
• In 2001, SocGen acquired more than 96% of Slovenia's SKA Banka, d.d. SKA Banka was founded in 1978 as Stanovanjsko-Komunalna Banka, offering residential mortgages as well as financing municipal construction. As of 2007, SKB operated 57 branches in Slovenia.
• In 2001, SocGen bought 60% of Komercni Banka from the Czech government for Euro 1.19-billion (USD $1.01-billion).
• In 2003, SocGen bought 50.7% of Ghana's SSB Bank Ltd. SSB Bank is Ghana's No. 4 bank and operated 38 branches.
• In 2003, SocGen bought Banca Romana pentru Dezvoltare (BRD) of Romania.
• In 2004, bought 50.17% of the General Bank of Greece (GBG) from the Greek Army Pension Fund. Following the purchase, GBG was renamed Geniki Bank.
• Also in 2004, SocGen acquired 75% of Hamburg-based Hanseatic Bank from the Otto Group for EUR 190-million.  Hanseatic is a small German bank offering deposit and real-estate loan products.
• In 2005, SocGenbought 64.4% of Montenegro's Podgoricka Banka for Eur 14.2-million. Podgoricka Banka had 19 branches in the former Yugoslav nation.
• Also in 2005, SocGen bought Poland's Euro Bank SA (also branded as eurobank). Euro Bank had 110 offices in Poland offering consumer credit products.
• Also in 2005, SocGen offered Eur 345-million (USD $420-million) for Egypt's Misr International Bank (MiBank). Shareholders owning 69.7% of Misr International had agreed to tender to Société Générale's offer.
• In 2006, SocGen bought Croatia’s HVB Splitska Banka for HRK 7.29-billion (Eur 1.0-billion) from Italy’s UniCredit SpA, which was forced to sell HVB Splitska because UniCredit's takeover of Germany's HVB Group had given the combined bank more than the 10% market-share ceiling permitted in Croatia. HVB Splitska Banka operated 112 branches in Croatia.
• In July 2006, SocGen spun off 75% of its SG Cowen Securities in an IPO for USD $180-million. The newly-listed business was renamed Cowen Group Inc.
• In 2006, SocGen bought, in two stages, a total of 20% of Russia's Rosbank for USD $634-million.
• In 2007, SocGen's brokerage unit Fimat merged with Crédit Agricole's Calyon's brokerage unit Calyon Financial. The new entity was named Newedge and became a 50/50 joint-venture of SocGen and Crédit Agricole’s Calyon.
• In 2007, SocGen bought 70.57% of Moldova's BC Mobiasbanca for MDL 303-million (Eur 18-million, USD $24-million).
• In 2007, SocGen bought Brazil's consumer finance bank Banco Cacique for BRL 850-million (Eur 309-million, USD $407-million). Banco Cacique had a network of 190 branches, 900,000 individual clients and 350,000 active credit cards.
• In January 2008, SocGen discovered that its “rogue” trader Jérôme Kerviel had amassed unauthorized trading positions totalling Eur 50-billion (USD $74.5-billion). The bank immediately and secretly unwound its exposure by selling Eur 18-billion worth of DAX index futures, Eur 30-billion of the DJ Euro Stoxx 50 futures and Eur 2-billion of FTSE 100 futures. SocGen’s sale of these index futures was said to have deepened the global market rout on 2008-01-22. Following the unwinding, SocGen disclosed that it had lost Eur 4.9-billion (USD $7.2-billion) from Kerviel’s trades. In order to restore the depleted capital, SocGen raised Eur 5.5-billion (USD $8.44-billion) from a rights issue in March.
• Also in 2008, SocGen bought Capitalia’s securities services business from Italy’s UniCredit for Eur 195-million. The unit purchased had Eur 102-billion of assets under custody and another Eur 27-billion under administration.
• In 2008, SocGen indicated that it would exercise its call option to acquire another 30% of Russia's Rosbank for USD $1.7-billion. The exercise of this option would trigger a mandatory offer to current minority shareholders that will lead to an increase of SocGen's stake in Rosbank to 57.8%. Rosbank served 3 million individual clients, 60,000 small- to medium-size enterprise accounts and 7,000 corporate clients through 600 branches.
• Also in 2008, SocGen bought Ikar Bank of Ukraine, which specialized in consumer finance through 14 branches.
• In 2008, SocGen bought 15% of South-East Asia Bank (SeA Bank), a small Vietnamese bank with 55 branches.
• In early 2009, Crédit Agricole and fellow French bank Société Générale agreed to merge their asset management operations. Crédit Agricole would own 75% of the combined entity and Société Générale would own the rest. The new entity would have Eur 591-billion (USD $766-billion) under management and would be the fourth biggest in Europe. The new firm, originally known as CAAM-SGAM, was later renamed Amundi Asset Management and said to be worth about Eur 6-billion according to SocGen’s own estimates. The two French banks agreed to maintain their stakes for five years, but planned to launch an IPO and sell part of stake to the public in the future.
• Between November 2008 and May 2009, the French government subscribed to a total of Eur 3.4-billion of SocGen securities as part of the French Economic Support Plan.
• In October 2009, SocGen raised Eur 4.8-billion (USD $7-billion) in a rights issue. The bank planned to use Eur 3.4-billion (USD $5-billion) to repay state aid and the rest to make acquisitions and boost capital strength.
• In August 2012, SocGen sold its Los Angeles-based majority-owned asset manager TCW Group Inc. to an investor group led by Carlyle Group LP. The deal valued all of TCW at between USD $700-million and $800-million.  TCW managed USD $131-billion of assets.
• In October 2012, SocGen sold its loss-making Greek subsidiary Geniki Bank to Piraeus Bank for practically nothing (Eur 1-million, USD $1.31-million).  Furthermore, SocGen had to inject Eur 281-million into Geniki and subscribe to Eur 163-million of Piraeus Bank's convertible bonds as part of the sale agreement.  SocGen had to literally pay Piraeus to take over Geniki as the Greek sovereign debt crisis can potentially expose SocGen to losses much higher than the Eur 444-million it's costing to get rid of the Greek subsidiary. Geniki operated about 140 branches in Greece.
• In December 2012, SocGen sold its 77.2% stake in Cairo-based National Société Générale Bank SAE (NSGB) for USD $1.97-billion (Eur 1.50-billion) to Qatar National Bank SAQ.  National Société Générale Bank served 700,000 clients through 160 branches in Egypt.
• In November 2013, SocGen bought the 50% of brokerage firm Newedge Group that it didn't already own from partner Crédit Agricole for Eur 275-million, meanwhile, it sold a 5% stake in asset manager Amundi to Crédit Agricole for Eur 337.5-million. Following the transactions, SocGen would own all of Newedge Group and 20% of Amundi.
• In March 2014, SocGen sold its Asian private banking business to Singapore's DBS for USD $220-million (Eur 158-million). The business sold had USD $12.6-billion of assets under management.
• In May 2014, SocGen wrote down its Russian retail subsidiary Rosbank's value by Eur 525-million (USD $731-million). Tension between the West and Russia has been high since the geopolitical crisis between Ukraine and Russia led to an exodus of capital from Russia, as well as a sharp drop of the Russian rouble and stock market.
• In November 2015, SocGen sold its entire 20% stake in Amundi Asset Management in an IPO for EUR 1.5-billion (USD $1.6-billion). Amundi was listed on the Paris Stock Exchange.
• In November 2018, SocGen sold its Polish subsidiary Euro Bank S.A. (also known as "eurobank") to Bank Millennium S.A. for PLN 1.83-billion (EUR 426-million, USD $485-million). Bank Millennium is 50.1% owned by Portugal's Banco Comercial Português (BCP). Euro Bank's 250 branches and another 251 franchised locations will join Bank Millennium's 359 branches, with some branch closures expected.
• In December 2019, SocGen agreed to sell its Norwegian-based SG Finans division to Helsinki-based Nordea Bank for EUR 575-million (USD $634-million). SG Finans provides equipment finance and factoring solutions in Norway, Denmark and Sweden.

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Belgium Bank Mergers & Acquisitions (Fortis/ ageas)

Photo: Hong Kong's financial-centre status began to take off in the early 1980s, which coincided with a major expansionary phase of many European and American banks. The secondary school that I attended, Newman College, interestingly kept their account at the Hong Kong unit of Belgian bank Banque Belge pour l'Etranger, S.A. These two receipts show the nominal tuition (about USD $3) that my parents paid each year.

As part of the Société Générale de Belgique group (later Générale de Banque), Banque Belge pour l'Etranger eventually became part of the Fortis S.A., which was then acquired by France’s Banque Nationale de Paris.


ageas / Fortis Holding S.A./NV (Fortis S.A./NV)

Belgo-Dutch bancassurance group Fortis S.A. was formed in 1990 when Dutch insurer NV AMEV merged with Dutch bank VSB Groep to form AMEV/VSB. Later in that year, Belgian insurer AG Groep joined in, marking the first cross-border merger in the European financial services sector. The new entity took up the new name Fortis in 1991. In 2008, Fortis became de facto bankrupt and the banking operations were split and sold to the Dutch government and BNP Paribas. Fortis Holding kept part of the insurance operations and renamed itself ageas in 2010. Since this page is dedicated to banking history, emphasis is placed on the banking side of Fortis's history rather than the insurance side. Readers interested in the insurance part of Fortis are advised to visit ageas' corporate website.


AMEV

In 1847, a funeral fund was created in Utrecht (Netherlands) to allow a person to contribute (prepay) a premium of a few cents a week towards funding the eventual funeral cost of the contributor. In 1883, life insurance products were added to the funeral fund company, now known as Levensverzekering Maatschappij Utrecht (Life Insurance Society Utrecht), or commonly known as "De Utrecht". In 1920, the families that owned De Utrecht placed their business holdings under a new company called Algemeene Maatschappij tot Exploitatie van Verzekeringsmaatschappijen, or AMEV (loosely, the Insurance Development Company).


VSB Groep

VSB can trace its history to 1817 when the Maatschappij tot Nut van ’t Algemeen (Society for the Promotion of the Common Good) was established. The society's mandate was to promote educational and social welfare, and to encourage savings for the working class through its savings bank facilities. In the 1980s, legislation changes in the Netherlands allowed savings banks to expand their business beyond the traditional personal savings and residential mortgage markets. This essentially eliminated the distinction between savings banks and general (or trading) banks, which could receive deposits and make loans to businesses. In 1981, Vereniging Centrumbank (Amsterdam), Spaarbank Rotterdam and Bondsspaarbank Breda amalgamated and began operating under the name Verenigde Spaarbank (or VSB Groep) in 1983. The name means United Savings Bank in English.


AG Groep

In 1824, the Maatschappij van Algemene Verzekeringen op het Leven, de dotale fondsen en de overlevingen (roughly, the General Life Insurance and Survivors Fund Society), or AG Leven, was created in Belgium. It was followed in the 1830 founding of Maatschappij van Algemene Verzekeringen tegen de gevaren van brand, or AG Brand, which offered fire insurance. Gradually, accident insurance policies and mortgage loans were added to the product mix. In 1967 AG Leven and AG Brand combined to form AG Groep. In 1990, AG Groep joined the AMEV/VSB group and adopted the new name Fortis S.A. (meaning “strong” in Latin) in 1991.


Generale Bank / (Société) Générale de Banque (including Banque Belge pour l'Etranger)

In 1815, following the defeat of Napoleon, Belgium and the Netherlands gained independence from France and became a single country known as the United Kingdom of the Netherlands. In 1822, the Algemeene Nederlandsche Maatschappij ter Begunstiging van de Volksvlijt was founded to promote the development of agriculture, manufacturing and trade. Eight years later, however, the Belgians seceded from the Netherlands and gained independence. The Belgian side of the business became known as Société Générale de Belgique to offer corporate banking services. Société Générale, as it was commonly known (no relation to the French bank with the same short name), was pivotal in financing many of Belgium's early long-term industries. By the 1860s, the bank was said to hold 20% of the capital of Belgium's joint-stock companies. International operations flourished after 1872 when Société Générale took part in the creation of the Paris-based bank Société française et belge de Banque et d'Escompte.

Perhaps surprising to many, the Belgian bank's first expansion outside of Europe happened in China in 1902, when the Banque Sino-Belge (Chinese-Belgian Bank) was established in Shanghai, Beijing, Tianjin and Wuhan. The bank was set up specifically to receive and handle the reparations that China was required to pay to Belgium, plus ten other nations, following the Boxer Rebellion between 1897 and 1901, when anti-foreign factions attempted to eradicate Western imperialism and Christian missions in China.  The launch of the Chinese branches marked the beginning of the bank's rapid international expansion. In 1909, the Banque du Congo Belge (Bank of Belgian Congo) and Banque Belge-Zaïroise (Belgian-Zairean Bank) were created in Belgian Congo, followed in 1911 by the creation of the Banque Brésilienne Italo-Belge (Italian-Belgian Brazilian Bank) in Brazil.

Offices were soon opened in London (1909), Sao Paolo (1911), Egypt and Montevideo (1912), Rio de Janeiro (1913) and Buenos Aires (1914).  Meanwhile, in 1913, the bank's operations in London, Egypt, China and several other countries were re-organized into the Banque Belge pour l'Etranger (roughly translated as Belgian Foreign Bank).  For a number of years, Banque Belge pour l'Etranger, like many foreign banks operating in China at the time, issued part of China's banknotes.  

Interestingly, Banque Belge pour l'Etranger's London office became a saviour to the Société Générale de Belgique group during World War I when it kept the operations going while Belgium was occupied by the German army.

Further expansion saw the Banque Belge pour l'Etranger opening offices in New York in 1917, and in Paris, Manchester and Cologne in 1919, Bucharest in 1920, Constantinople in 1924 and Hong Kong in 1935.  Back in 1919, parent bank Société Générale de Belgique was a major backer in the creation of the Banque Générale du Luxembourg, which eventually became Luxembourg's largest commercial bank.  In 1920, Société Générale de Belgique participated in the re-capitalization of Austria's Wiener Bankverein, which like many Austrian banks suffered heavy losses following the collapse of the Austro-Hungarian Empire at the end of World War I.

An interesting fact about Banque Belge pour l'Etranger's New York office was that it eventually obtained a local state charter and built a network of retail branches in Long Island.  It subsequently became known as Belgian American Bank and then European American Bank & Trust, and was first sold to Dutch bank ABN AMRO, then to Citigroup in 2001.

The start of World War II and the turmoil in China in the 1940s caused the disintegration of Banque Belge pour l'Etranger, as many markets fell into enemies' control.  During World War II, with Belgium itself under Nazi occupation, Banque du Congo Belge, the Belgian Congo subsidiary, became the provisional head office co-ordinating whatever limited operations for parent firm Société Générale de Belgique. 

Following the world-wide conflict, the only meaningful overseas operations of Banque Belge pour l'Etranger to resume were surprisingly in New York and Hong Kong, the latter of which remained part of the Belgian bank group until 2004, when it was sold to ICBC.

The rise of the middle class in the 1950s and 1960s led the Belgian bank to vastly expand into personal (retail) banking in addition to its traditional business of corporate banking. Personal savings and loans, and mortgage products were introduced.  Between 1965 and 1975, the Société Générale de Banque (a new name replacing the Société Générale de Belgique) opened many new domestic branches. In 1985, the retail bank was renamed Générale de Banque. Then, in 1988, Société Générale de Banque was taken over by Compagnie Financière de Suez, the company that once operated the Suez Canal. In 1998, Suez sold the historic Belgian bank to Fortis S.A., a rival Belgian bank.

Recent transaction(s):

• In 1993, Fortis bought 50% of Belgium’s CGER-Banque and CGER-Assurances. ASLK-CGER traces its history back to the 1865 founding of the Caisse Générale d'Epargne et de Retraite (The Savings and Retirement Fund). [ASLK is the Dutch name of CGER.]
  In 1995, ASLK-CGER acquired SNCI-NMKN of Belgium. Société Nationale de Crédit à l'Industrie (NMKN -- Krediet aan de Nijverheid in Dutch) was established in 1919 and specialized in financing the shipping, steel, coal and textile industries. From the late 1980s, SNCI-NMKN began to offer banking services to private clients in addition to corporations.
• In 1995, Générale de Banque acquired Crédit Lyonnais Bank Nederland (CLBN) from France's Credit Lyonnais for NLG 1.2-billion (USD $726-million). Credit Lyonnais Bank Nederland was involved in a corporate scandal and poor risk management that saw the bank lending more than USD $1.3-billion to Italian financier Giancarlo Paretti to buy Metro-Goldwyn-Mayer Inc. in 1990. Soon after his purchase, MGM went bankrupt, causing CLBN and parent company Credit Lyonnais well over USD $1-billion in loan losses.
• In 1996, Fortis acquired Dutch merchant bank Mees Pierson NV from ABN AMRO Holding NV for Dutch Guilder 2.5-billion (USD $1.43-billion).
• In 1997, Fortis bought another 25% stake in ASLK-CGER-Banque (including its CGER-Assurances subsidiary), bringing its total holding in ASLK-CGER to 75%.
• In 1998, Fortis bought 98.2% of rival Belgian bank Générale de Banque (also called Generale Bank in Dutch) for USD $14.2-billion from Suez Lyonnaise des Eaux. Fortis beat out Dutch rival ABN AMRO Holding in the bidding war for Générale de Banque.
• In 1999, the various banking operations of Crédit à l'Industrie, ASLK-CGER, Générale de Banque and VSB were consolidated under the new Fortis Bank brand.
• Also in 1999, Fortis took full control of Belgian bancassurance firm ASLK-CGER.
• In 2000, Fortis agreed to buy the 47% of Banque Générale du Luxembourg S.A. that it did not already own for Eur 1.62-billion (USD $1.59-billion). BGL was founded in 1919 by the Société Générale de Belgique and other investors.
• Also in 2000, Fortis acquired the 80% of Dutch insurer ASR Verzekeringsgroep that it did not own for Eur 3.3-billion (USD $2.9-billion).
• Also in 2000, Fortis raised its ownership in Belgolaise Bank, a Belgian bank focusing in the African market, from 62% to almost 100%.
• In 2004, Fortis sold its Hong Kong network (known as the Belgian Bank since 1980) to the Industrial and Commercial Bank of China.
• In 2005, Fortis purchased 93% of Turkey's Disbank for Eur 987-million (USD $1.28-billion).
• In 2007, Fortis agreed to buy 50.48% of Hong Kong's Pacific Century Insurance from its parent PCRD for HKD $3.52-billion (USD $453-million, Eur 345-million). Fortis would also launch a general offer to all other shareholders at the same price, bringing the total value of the deal to HKD $6.98-billion (USD $897-million, Eur 683-million).
• In October 2007, after a six-month battle with Barclays plc, Fortis S.A./NV, along with The Royal Bank of Scotland Group plc and Banco Santander S.A., won the control of ABN AMRO Holding NV with a Euro 70.0-billion (USD $101.1-billion) cash-and-stock offer. The deal was then the world's largest banking merger ever and consisted of 93% in cash and 7% in Royal Bank of Scotland shares. The tri-bank consortium planned to break up ABN AMRO's global operations with Fortis taking over ABN AMRO's banking business in the Netherlands, as well as its global investment management and private banking operations. Until the break-up was completed, Fortis owned a 33.8% stake in ABN AMRO, while The Royal Bank of Scotland owned a 38.3% stake, with the remaining 27.9% being owned by Banco Santander.
• Late in 2007, Fortis sold its 8.23% stake in ICBC (Asia) to Industrial and Commercial Bank of China (ICBC) for HKD $1.92-billion (USD $246-million). Fortis had acquired the stake initially in 2004 when it sold its 22-branch Hong Kong network to ICBC (Asia).
• In 2008, Fortis S.A. agreed to sell 50% of its global asset management arm Fortis Investments to China's Ping An Insurance for Eur 2.15-billion (CNY 24.0-billion, USD $ 3.39-billion.) Fortis Investments planned to change its name to Fortis Ping An Investments after the deal was closed. Fortis Investments, along with the asset management business it bought from ABN AMRO Holding in 2007, had Eur 245-billion (USD $386-billion) of assets under management. Before this partial sale, Fortis had written down Eur 2.7-billion (USD $ 4.1-billion) in sub-prime mortgage-related assets, and was badly in need of new capital. However, this sale agreement was rescinded in September 2008 after Fortis collapsed. China’s banking regulator also had denied Ping An’s proposed investment.
• In 2008, Fortis agreed to sell its commercial-lending unit in the Netherlands to Deutsche Bank AG for Eur 709-million (USD $1.13-billion). The unit being sold was part of the ABN AMRO operations acquired by Fortis in 2007 and had a net asset value of Eur 1.01-billion. However, closing of the transaction was postponed indefinitely as the Dutch Central Bank had refused to grant approval pending a review of Fortis’ entire Dutch operations amidst the 2008 Banking Crisis.
• Also in 2008, Fortis sold its 49% stake in Chinese fund manager ABN AMRO TEDA to Britain's insurer and bank Old Mutual for Eur 165-million (USD $244-million). Fortis had acquired the stake in ABN AMRO TEDA when it acquired ABN AMRO Holding's Dutch operations in 2007.
• During the second half of 2008, Fortis was caught up in the global Banking Crisis. As financial institutions failed around the world from huge losses incurred from the U.S. real estate collapse, banks became unwilling to lend to each other, resulting in a sharp rise in the Libor rates (London Inter-bank Borrowing Rates). Banks that had over-extended themselves, including Fortis, experienced massive withdrawal of deposits from their clients, causing more stress to their capital base just when they needed more capital.
• On 2008-09-29, the Belgian, Dutch and Luxembourg governments jointly rescued Fortis by providing Eur 11.2-billion (USD $16.2-billion) of emergency funding. The Belgian state agreed to buy 49% of Fortis' Belgian banking unit, Fortis Bank NV/S.A. for Eur 4.7-billion (USD $6.79-billion); the Dutch state agreed to buy 49% of the Dutch bank unit, Fortis Bank Nederland Holding, for Eur 4.0-billion (USD $5.78-billion); whereas Luxembourg agreed to buy 49.99% of the local unit Fortis Banque Luxembourg for Eur 2.5-billion (USD $3.61-billion). Fortis was also expected to auction off the ABN AMRO businesses that it had just bought in 2007 for more than Eur 24-billion. However, the most likely buyer, ING Groep, had announced that it was not interested in bidding for ABN AMRO’s global operations.
• However, the massive cash injection from Belgium, the Netherlands and Luxembourg failed to quell widespread fears over Fortis’ solvency, and clients were said to be transferring their deposits to other banks. On Friday 2008-10-03, the Dutch government made a surprise announcement that it had agreed to nationalize the entire Dutch operations of Fortis S.A./NV for Eur 16.8-billion (USD $23.2-billion). The units bought by the Dutch government included all of Fortis Bank Nederland (Holding) NV, Fortis’s interests in ABN AMRO, insurer Fortis Verzekeringen Nederland NV, and Fortis Corporate Insurance NV. The Dutch government’s deal to buy all of Fortis’ Dutch banking and insurance operations replaced the deal to buy 49% of Fortis Bank Nederland for Eur 4.0-billion (USD $5.78-billion) announced just a week earlier.
• Even though Fortis’s Dutch operations were not believed to be badly in distress, the Belgian-based parent Fortis SA/NV had been teetering on the brink of insolvency. The Dutch government said in a statement that the nationalization of Fortis Nederland and ABN AMRO was needed to stabilize the panicky Dutch monetary system. The deal gave the Dutch government the entire control of the bancassurance operations, which would make it much easier to sell than had the government only acquired a minority stake. The deal also allowed Belgian-based Fortis to receive badly-needed capital.
• The loss of the more stable Dutch businesses, however, distressed the public confidence on Fortis even more so over the weekend. On Sunday 2008-10-05, the Belgian government stepped in for the second time in a week and pumped in another Eur 4.7-billion (USD $6.33-billion) to fully nationalize Fortis Bank S.A./NV to 100%. Belgium and Luxembourg then immediately sought help from French banking giant BNP Paribas S.A. Following hours of intense and frantic talks, BNP Paribas agreed to acquire most units of Fortis S.A./NV for Eur 14.5-billion (USD $19.5-billion). Under the agreement, BNP Paribas would buy 75% of Fortis Bank (Belgium) and 67% of Fortis Banque Luxembourg for Eur 9.0-billion (USD $12.1-billion), payable in BNP Paribas shares. BNP Paribas also agreed to buy all of Fortis’s insurance operations in Belgium for Eur 5.5-billion (USD $7.4-billion) in cash.
  Belgium had just taken full control of Fortis Bank S.A./NV hours earlier before brokering the sale to the French bank. Following the sale, the Belgian government would retain a 25% stake in the Belgian bank and hold an 11.6% stake in BNP Paribas.
• As for Fortis Banque Luxembourg, BNP Paribas would acquire a 51% stake from parent firm Fortis S.A./NV, and a 16% stake from the Luxembourg government, which had acquired a 49.99% stake in the Luxembourg unit a week earlier for Eur 2.5-billion. Luxembourg would retain a 33% stake in Fortis Banque Luxembourg, and hold a 1.1% stake in BNP Paribas.
• Following the sale, former parent company Fortis S.A./NV, to be renamed Fortis Holding, would only consist of Fortis’s minuscule international insurance operations outside of Belgium and Netherlands.
• BNP Paribas would gain Fortis’s 1,458 branches in Belgium, Luxembourg, Poland, Turkey, France, and other countries except the Netherlands. It would also gain more than Eur 239-billion of customer deposits, making BNP Paribas the largest bank in the Eurozone based on deposits.
• However, on 2008-12-12, a Belgian appeal court halted the sale of 75% of Fortis Bank S.A./NV, the sale of 67% of Fortis Banque Luxembourg, and the sale of all of Fortis’s Belgian insurance business to BNP Paribas. It was alleged that Belgian Prime Minister Yves Leterme had sought to influence a court into allowing the fire sale of Fortis. M. Yves Leterme resigned over the controversies, requiring the Belgian king to name a new, interim prime minister. Meanwhile, the latest court ruling required the sale be suspended for 65 days, citing that the Belgian government had not considered the interest of Fortis’s shareholders, nor allowed them to vote on the sale.
• When the original deal between Fortis S.A./NV, BNP Paribas, Belgium and Luxembourg died, Belgium was holding 100% of Fortis Bank, which consisted of 100% of Fortis Bank Belgium and 50.01% of Fortis Banque Luxembourg, whose name was officially changed to BGL (clearly a short form of the old Banque Générale du Luxembourg name) to avoid further negative association with the Fortis name. The remaining 49.99% of Fortis Banque Luxembourg had been held by Luxembourg since October 2008.
• On 2009-02-11, Fortis’s shareholders rejected the original agreement with BNP Paribas. Shareholders also rejected the sale of Fortis Bank Nederland to the Dutch government for Eur 16.8-billion back in October 2008, even though that sale had already been completed and was unlikely to be unwound. The rejection could open up potential lawsuits against the Dutch government for financial damages according to some legal experts.
• On 2009-03-08, the Belgian government, Fortis S.A./NV (for clarity reason, hereafter referred to as Fortis Holding) and BNP Paribas reached a new agreement on the future of the Fortis group. The deal was still subject to a vote by Fortis’s shareholders and there were strong opposition from Ping An Insurance of China (which owned just under 5% of Fortis Holding) and other major shareholders according to media’s reports.
• Under the new agreement, the Belgian government (which was already the sole owner of Fortis Bank Belgium) would transfer 75% of Fortis Bank to BNP Paribas for Eur 8.25-billion (USD $10.5-billion) in BNP Paribas shares, priced at Eur 68 per share. In addition, BNP Paribas would also pay Eur 1.375-billion (USD $1.75-billion) for 25% of Fortis Insurance Belgium from Fortis Holding. Finally, BNP would acquire a direct 16% stake in BGL from the Luxembourg state for about Eur 831-million (USD $1.06-billion) in BNP shares.
• Following the approval by Fortis’s shareholders, BNP Paribas would own 75% of Fortis Bank Belgium (the remaining 25% continued to be held by the Belgian state), hold 16% of Luxembourg's BGL (the former Fortis Banque Luxembourg), control another 50.01% of BGL via BNP's 75% holding in Fortis Bank Belgium (the remaining 34% of BGL continued to be held by the Luxembourg government). BNP would also hold 25% of Fortis Insurance Belgium.
• As of May 2009, Fortis Holding only consisted of 75% of AG Insurance (Fortis’ insurance operations in Belgium) as well as 100% of Fortis Insurance International. The demise of the Fortis financial empire was sad, painful, dramatic and swift.
• In 2010, Fortis Holding renamed itself ageas.
• In August 2015, Ageas sold its Hong Kong insurance operations to China's JD Capital for HKD $10.7-billion (USD $1.38-billion).

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