A high level of competition is seen for Vojvodjanska Banka, the fifth largest Serbian bank with assets of $571m and EUR 80m of capital, which is currently being privatised. The long list of potential bidders include Intesa, Unicredito, Sanpaolo IMI, BNP Paribas, Credit Agricole, National Bank of Greece, Alpha Bank, Emporiki, Piraeus, OTP Bank, and PKO BP. The bank turned a profit of almost $ 1m in 2005, following a loss of $ 85m in 2004, but the general manager indicated that earnings would have been higher, were it not for heavy provisioning requirements. Given the success of Romania in selling BCR and the level of interest in the bank, the Serbian Finance Minister has stated that he expects the price for to be higher Vojvodjanska Banka to be higher than 3.3x book value. In our opinion, the market would rather see OTP Bank walk away rather than overpay for an acquisition and the bank's management has yet to disappoint in this regard. If the bank is unsuccessful in acquiring Vojvodjanska Banka in the face of stiff competition, we would expect a neutral trading reaction. We reiterate our Buy rating on OTP Bank.