The accounts of the bank's customers will be transferred to Bank Hapoalim.
Israel Continental Bank will cease to exist on July 1, when it will be absorbed into Bank Hapoalim (LSE:BKHD; TASE:POLI). Continental Bank will cease operations as a banking corporation, and its assets and liabilities will be taken over by Bank Hapoalim. All Continental Bank branches will be shut and its 68 employees, who are Bank Hapoalim employees, will be transferred to positions within Bank Hapoalim. A notice has been sent to all Continental Bank customers regarding the transfer of their accounts to Bank Hapoalim.
The merger comes six months after Bank Hapoalim acquired Swedish bank SEB's (SAX:SEB) 37% stake in Continental Bank for €10 million, thereby obtaining full ownership of the bank. The deal was carried out at a company value of €27 million for Continental Bank, the same as its shareholders equity at the time.
Continental Bank's main business was providing credit to business customers. The bank has caused its owners heavy losses in recent years, after providing NIS 190 million in credit to the financially troubled Peled-Givony group.
The Continental Bank merger is bank Hapoalim's fourth merger in recent months. It has already absorbed Mishkan Mortgage Bank, and two small banks: Maritime Bank (at the initiative of the Bank of Israel Banking Supervision Department), and Bank Polska Kasa Opieki - PKO (Bank Pekeo).
Published by Globes [online] - www.globes.co.il - on May 6, 2004