UPDATE 1-Vestjysk Bank to buy two Danish peers
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COPENHAGEN, Sept 29 (Reuters) - Denmark's Vestjysk Bank (VJBA.CO) on Monday said it planned to buy smaller peers Ringkjobing Bank RIBA.CO and Bonusbanken BONU.CO after the small lenders had both been forced into larger-than-expected loan writedowns.
The deals are the latest in a surge of consolidation in Denmark's banking sector, which boast more than 130 smaller lenders, that started with the collapse last month of Roskilde Bank.
Vestjysk Bank is Denmark's seventh-largest bank by its market capitalisation of about $300 million. Ringkjobing is the Nordic country's fifteenth-largest listed lender, while Bonusbanken is significantly smaller.
Ringkjobing Bank, in a statement, cut its full-year profit outlook after realising larger-than-expected loan provisions, mostly where the collateral consists of securities that have decreased dramatically in value in recent weeks.
Bonusbanken said it had been forced to make larger-than-expected writedowns on some of its business and that its shareholders' equity had been wiped out.
Vestjysk Bank, said it would take over the activities of Bonusbanken with immediate effect, including all commitments relating to deposit customers.
Analysts have said an increasingly sharp downturn in the Danish real estate market coupled with a squeeze on liquidity may mean the end for many of the dozens of small, regional banks that handle the savings of hundreds of thousands of Danes.
Denmark's central bank on Friday said it was extending bank lending facilities to ease the present tight liquidity situation.
Separately on Monday, Roskilde announced it had sold its branch network to to Nordea (NDA.ST), Spar Nord Bank (SPNO.CO) and Arbejdernes Landsbank. (Reporting by Kim McLaughlin; Editing by David Cowell and Hans Peters)
