Absorption of Geniki makes financial sense for Piraeus group

By Yiannis Papadoyiannis

Piraeus Bank appears to be moving ever closer to a decision to fully absorb Geniki Bank, as its administration considers this the best solution not only for the subsidiary but also for the group’s financial figures.

Analysts say that the Piraeus Group will get a much needed boost if it abandons its original plan to transform Geniki into a lender specialized in restructuring troubled enterprises and instead fully absorbs the bank and its employees,

Geniki enjoys strong liquidity, with a loans to deposits ratio of 82 percent, a robust capital base with a capital adequacy ratio above 18 percent, and the ratio of coverage of nonperforming loans by provisions at 63 percent, one of the highest in the local market.

According to the latest figures, for the end of December, Geniki’s assets amounted to 2.67 billion euros, its deposits were 2.17 billion while its loans came to 1.79 billion euros.

The Piraeus Group took control of Geniki in December 2012 following an agreement with its previous main stakeholder, Societe Generale.