Danske Bank intends to sell its Estonian loan portfolio of personal customers to AS LHV Pank

As part of the banking business wind-down process in Estonia, Danske Bank enters into an agreement with the Estonian bank AS LHV Pank, which intends to acquire Danske Bank’s loan portfolio of local personal customers. The parties have agreed on material terms of the contract and intend to sign it on June 5.

Both parties expect to finalise the transaction in autumn 2019, when the final scope and price of the transaction will also be determined. Prerequisites for finalising the transaction are getting permission from the Competition Authority. The occurrence of the transaction also depends on further negotiations.

The volume of the loan portfolio is around 470 million euros, about 97% of which are home loans, in total 10,800 customers.

“On the 19th of February 2019, we announced the closing of all our banking activities in the Baltics. Today’s agreement marks an important step in achieving this goal and represents a good solution for the private customers affected,” says Frederik Bjørn, Head of Baltics and Russia, Danske Bank.

Both parties have committed to ensure a smooth transfer of services and all needed assistance to customers subject to this transfer. Terms and conditions of Danske Bank Estonia branch customers’ loan agreements will not change with the automatic transfer of loans, unless clients themselves wish to amend the contracts. Once the sale is formally in place, customers will be contacted with full details of the transfer process and how this will affect their future loan servicing agreements. In the meantime, customers do not need to take any action and their loan servicing will continue as usual until further notice.

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