BUSINESS

Piraeus Bank to bolster cash reserves

EVGENIA TZORTZI

TAGS: Banking

The management of Piraeus Bank has announced a program to boost its capital base by 1 billion euros to create the cash reserves that will allow it to proceed with a more aggressive reduction of its bad-loan portfolio.

While informing analysts of the bank's third-quarter financial results, Chief Executive Christos Megalou said that the cash boost plan has four main points.

The first concerns the sale of its cash machine network to an independent company, a move that should earn some 300 million euros. Another point that is seen fetching 300 million euros is the securitization of performing loans amounting to 2 billion euros.

The bank further intends to concede to a fund the management of holdings up to 400 million euros that the Piraeus Group has in companies incorporated in its financial report, a move that should benefit the lender by some 100 million. Finally Piraeus will save 300 million from its non-payment of the coupon on its contingent convertible bonds (CoCos) for 2020 and 2021.

Megalou confirmed that Piraeus had received the European Central Bank's final decision against the coupon's payment in cash.

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