INGA ING Groep NV

   By Colin Kellaher 
 

Bank of Nova Scotia (BNS.T, BNS) on Tuesday said it has signed a non-binding memorandum of understanding for a potential deal that would significantly reduce its investment in Thailand.

The Toronto-based bank said the memo, with ING Groep N.V. (INGA.AE), Thanachart Capital PCL (TCAP.TH), Thanachart Bank PCL and TMB Bank PCL (TMB.TH) involves the proposed merger of Thanachart Bank and TMB.

Scotiabank said the contemplated transactions are complex, but said they would result in the company holding a significantly smaller stake in the combined bank and receiving proceeds that would result in a gain and a roughly 25-basis-point boost to its common equity Tier 1 capital.

The Bangkok Post this week reported that TMB Bank and Thanachart Bank are moving closer to a merger, but that it will take another three to four months to map out the details.

Thailand's finance ministry holds a 25.9% stake in TMB while ING has a 25% stake, according to the report, while Thanachart Capital holds a 51% stake in Thanachart Bank and Scotiabank owns the rest.

Scotiabank recently announced deals to sell its operations in nine Caribbean countries, as well as its banking and insurance operations in El Salvador, as it moves to focus on its core markets.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

February 26, 2019 07:06 ET (12:06 GMT)

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