BANKING

Piraeus set to announce big NPE project

piraeus-set-to-announce-big-npe-project

Piraeus Bank chief executive officer Christos Megalou is on Tuesday set to announce the lender’s business plan for raising 2.5 billion euros, allowing it to reduce its nonperforming exposure (NPE) ratio below 10%, from 47% at end-September 2020.

That ambitious plan, to be implemented over the next 12 months, will rest on three pillars: The first will be the €1 billion share capital increase, anticipated in late April with the participation of bank bailout fund HFSF and private investors; the second will be the issue of Tier 2 bonds up to €600 million; and the third is the completion of the capital strengthening measures topping €1 billion that Piraeus Bank had announced in the third quarter of 2020.

This €2.5 billion boost is seen covering the losses from a major securitization, so that NPEs drop drastically from the level of €22.7 billion that the latest figures showed for end-September.

Given that the lender has announced two securitization projects worth a total of €6.9 billion (Phoenix and Vega), a new project, possibly worth around €13 billion, is expected to be announced soon.