Financial Services in Central & Eastern Europe

CMS and mergermarket have published a report in order to shed some light on current Financial Services (FS) activity in Central and Eastern Europe (CEE). Te report (downloadable below) provides an in-depth analysis of 2008 activity and takes a look forward at this year's deal prospects. It also uncovers market sentiment through a survey of leading FS executives and contains features looking at the impact of the credit crisis and M&A regulation in the region.

2008 was a year of change for deal makers, and the air of uncertainty looks set to continue. However, those involved in deals have become more savvy and aware of the current environment and are thus better equipped to cope with the year ahead.

The volume of deals in the FS sector in CEE has undoubtedly dropped; in Q4 2007 31 deals were completed whilst in Q4 2008 there were just under half of that with 15 deals completed.

Evidently CEE is not immune to the wider global economic problems and this is no surprise given that many of the large companies, which have had been at the root of the crisis, have subsidiaries scattered across the region. Even so, many deals may not be aborted, but merely postponed until a more agreeable time. Of the respondents surveyed over half believe that the level of private equity buyouts in the CEE FS sector will increase in 2009 and 47% judge that low valuations will be the primary reason to conduct acquisitions.

It is clear that in the difficult economic environment of the coming year, seeking the right advice is essential. CMS has an active and efficient team working in the FS sector and has a first class reputation in CEE. We provide strategic advice to many international players on domestic and cross border deals.

If after reading the report you would like to discuss any aspects of the Financial Services sector in CEE and the CIS region we would love to hear from you.