Alpha CEO: Lenders must pass back into private hands swiftly

Local banks need to make a fast return to private hands, Alpha Bank CEO Dimitrios Mantzounis stressed while addressing the lender’s general meeting on Friday. Vassilios Rapanos, the bank’s president, referred to a need for stability and the implementation of reforms.

Mantzounis described the pictured created by local banks’ recent share capital increases as “distorted,” noting that Alpha may have received the least support from the state but that the Hellenic Financial Stability Fund holds the biggest stake in it compared to HFSF holdings in the other systemic banks.

He noted that the warrants – i.e. the rights to buy back the shares held by the HFSF – were a very good way of attracting investors during the first recapitalization, but that conditions have now changed and investors are thirsty for Greek securities and therefore the process for the banks’ privatization has to be accelerated.

The Alpha CEO, speaking in the presence of Finance Minister Gikas Hardouvelis, new Bank of Greece Governor Yannis Stournaras and HFSF CEO Anastasia Sakellariou, also remarked that since the law allows for the alternative utilization of the warrants, banks should make the most of the favorable climate and speed up their return to private hands. He said that each lender should examine the issue and submit proposals for the best decisions to that end either via the Hellenic Bank Association or independently.

Concerning nonperforming loans, Mantzounis said there are signs of improvement, adding that a substantial economic recovery is necessary for the situation regarding bad loans to change markedly. He added that Alpha has strong capital reserves as its capital adequacy ratio stands at 15.6 percent ahead of this fall’s European Central Bank stress test.

Rapanos stressed the significance of a stable tax environment and the need for the modernization of the country’s public administration. He added that 2014 will be the year that the economy makes a small rebound, highlighting the improvement in competitiveness. The biggest challenge from now on, noted Rapanos, is to achieve a sustainable model of economic growth. He forecast that deposits will gradually return to banks when conditions improve further, allowing lenders to finance the economy.