The National Bank of Greece general meeting scheduled for Friday is expected to approve the transfer of 75 percent of NBG’s insurance arm, Ethniki, to Dutch-based Exin Financial Services Holding BV. The deal will not include ownership of the Ethniki brand name, which will only be rented to the investor.
Exin confirmed on Thursday it will pay 718.2 million euros for three-quarters of the insurer that is assessed at 958 million. Market estimates suggest that the price is high.
The text of the agreement, which Kathimerini has seen, was approved earlier in the week by the bank’s governing board and will be presented at today’s annual shareholders meeting. Approval will constitute the first substantial step in the long sale process that began last November and will also require the stamp of the monitoring authorities.
The NBG group is utilizing a clause in its restructuring plan that allows it to retain a quarter of Ethniki’s shares. A key parameter in the deal is the bancassurance contract, allowing for the sale of insurance products through the bank’s branch network via a 10-year contract that can be extended for another five years. “Ethniki remains NBG’s exclusive bancassurance provider under a new 10-year partnership agreement for life, savings and non-life insurance products,” Exin said.
The price also includes the transfer of Ethniki Insurance Cyprus, valued at 13.4 million euros, as well as Ethniki’s activities in Romania, under the name Garanta, whose value is estimated at 16.8 million euros.
Another important parameter is the Ethniki Insurance brand name, which does not form part of the deal. The text of the agreement provides for the NBG group to acquire the brand name at a price to be agreed with the investor, and then lease it back to it for a decade.
The deal also excludes Ethniki’s real estate assets, with an accounting value of 51 million euros, which will be transferred to the NBG group and their price may lead to an adjustment of the Ethniki stake’s final price, which may well be flexible.