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BNP Paribas’ $16B US Sale To BMO Wins Regulatory OK

 |  January 18, 2023

BNP Paribas, France’s biggest listed bank, said on Wednesday that it had received all the necessary regulatory approvals to complete its previously announced sale of Bank of the West to Bank of Montreal.

BNP Paribas added that this transaction was expected to close on Feb 1.

Bank of Montreal agreed in December 2021 to buy BNP Paribas’ US unit, Bank of the West, for $16.3 billion in its biggest deal ever, allowing the Canadian lender to double its footprint in the world’s biggest economy, while giving BNP a huge step up in financial firepower for deals.

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“The closing of the Bancwest sale has been long-awaited … and is a significant positive catalyst for BNP shares in our view,” Jefferies analysts said in a note.

They said the deal would unlock 11 billion euros of capital for the French bank, of which 4 billion would be returned to shareholders via a share buy-back that could take place in the second quarter of this year.

Meanwhile, for BMO, the acquisition is expected to offer it a large-scale presence in California, driving customer growth in a key lucrative market of the United States.