On July 20, OTP Bank announced the signing of an agreement with a consortium of funds managed by Blackstone and Norwegian DNB Bank to purchase 100% of the shares of Luminor Holding — a pan-Baltic banking group operating in Estonia, Latvia, and Lithuania. According to analysts' estimates, the transaction is valued at approximately 2 billion euros, although the financial terms were not officially disclosed.
What OTP is buying
Luminor is the third-largest financial services provider in the Baltics, created in 2017 as a result of the merger of the Baltic subsidiaries of DNB and Nordea. As of the end of 2025, the group has 15.9 billion euros in assets and 158 million euros in net profit with a return on equity of 8.6%.
For OTP, this is the largest deal in its history: the acquisition will increase the group's total assets by approximately 13% and expand its presence from 11 to 14 countries. The share of operations in the eurozone will reach 50%.
«OTP Bank views this deal not merely as geographic expansion, but as a strategic entry into a developed and stable market»
Peter Chani, CEO OTP Group
Where the problem lies
The deal is signed — but not yet closed. It requires approval from the European Central Bank in coordination with the Estonian regulator EFSA and in consultation with Lithuanian and Latvian supervisory authorities. And this is where a non-trivial knot arises.
OTP still maintains a full-fledged banking network in Russia: 2 million customers and 800 branches — more than four years after the start of the full-scale invasion. As reported by Lithuanian service LRT, the bank claims it "could not find a legally, morally and economically acceptable way to exit" the Russian market.
The Central Bank of Lithuania reacted even before receiving official documents about the deal: "The fact that the group operates in Russia raises legitimate questions," the statement reads, sent in response to a Reuters inquiry. Estonia, Latvia, and Lithuania are EU and NATO members that consistently support Ukraine and criticize Russia.
- Regulatory approval: ECB + three Baltic supervisors
- Key risk: OTP's active business presence in the aggressor country
- OTP's official position: we comply with all sanctions, cannot exit due to changes in Russia's regulatory environment since August 2022
- Financial terms of the deal: not publicly disclosed
What this means for the market
Since 2001, OTP has acquired 25 banks — and no deal has previously faced such a geopolitical context. Baltic regulators have a legitimate right to block or delay approval if they conclude that OTP's presence in Russia poses a systemic risk or conflicts with the region's financial stability interests.
However, there is no mechanism in publicly available documents that would require OTP to exit Russia as a condition of the deal. The signed contract is a declaration of intent, not a guarantee of closure.
If the ECB and Baltic regulators make exit from Russia a mandatory precondition for approval — the question becomes whether OTP is willing to sacrifice 2 million customers and a profitable asset in pursuit of Baltic expansion that it itself calls "strategic."
