CAIRO – French bank Societe Generale said it was in talks to sell its controlling stake in Egyptian unit National Societe Generale Bank to Qatar National Bank, as Europe's lenders retrench from expansion abroad. SocGen owns 77.17 percent of NSGB, which has a market capitalisation of $2.3 billion. The French bank is selling assets such as fund-management unit TCW as it tries to keep up with peers amid an industry-wide race to beef up capital. "The discussions are preliminary and there can be no certainty as to whether an agreement will be reached," SocGen said. "There will be other announcements in case of further developments." The holding currently has a value of about 10.8 billion Egyptian pounds ($1.77 billion), based on NSGB's 14 billion-pound market capitalization. Qatar National Bank said in April it had a five-year plan to make itself an "icon" in the Middle East and Africa by expansion and "diversifying income sources." The lender said today it raised its stake in Dubai-based Commercial Bank International PCS (CBI) to 39.9 percent from 16.5 percent. NSGB rose 0.2 percent to 31.61 Egyptian pounds in Cairo before the announcement, which came after the close of trading. "QNB has been looking at entering the Egyptian market for some time," Sara Boutros, banking analyst at Cairo-based Beltone Financial, said Friday. "NSGB has a cleaner book, a larger market share and better growth prospects than the local units of BNP Paribas SA (BNP) and Piraeus Bank SA. A request to conduct due diligence was presented Friday to Egypt's Central Bank, NSGB said. The bank said this month second-quarter profit climbed 18 percent to 435.6 million pounds, beating analysts' estimates on gains from interest and fee income. NSGB operates 160 branches in Egypt, while Commercial International Bank Egypt SAE, the country's biggest publicly traded lender, has 153 branches, data on the companies' websites show. Qatar National Bank is the second institution in the world's biggest exporter of liquefied natural gas to move to acquire an Egypt-based financial institution. – Agencies
