Backed by Bank of Nova Scotia, Thanachart Bank is reportedly nearing a deal to acquire the Thai cental bank's 47.6% stake in Siam City Bank for about $983-million. A person familiar with the negotiations also told Bloomberg that Thanachart plans to make an offer for the rest of Siam City.
If Thanachart does put an offer out for the remaining stake, the deal looks to be valued at above US$2-billion, according to Barclays Capital.
Although Bank of Nova Scotia should have no problem with the increased equity injection needed to keep its roughly 49% ownership in Thanachart, pending capital rules changes could make this a little more difficult to balance than in the past, Barclays warned.
Meanwhile, Royal Bank of Scotland is said to be in talks with a potential buyer for its Colombian operations. RBS is trying to refocus on its core businesses by disposing of assets inherited from ABN AMRO and is in talks with Scotiabank, according to Sky News.
Analysts at Barclays are not surprised that BNS may be interested as the asset would boost its presence in the region. And while the purchase would probably not be material for either bank, Barclays warned that "Scotia could be spreading itself a little thin in this environment of capital preservation, should it truly be pursuing acquisitions in Columbia and, as previously reported, in Thailand and Vietnam."