An issue that had been pending for about five years is being brought to a close with the transfer of 90.01% of National Bank of Greece’s insurance subsidiary, Ethniki, to CVC Capital. The deal comes with a 15-year contract for an exclusive cooperation regarding the sale of Ethniki’s insurance products through the NBG branch network.
The price, according to the bank’s statement, is based on a valuation of 505 million euros for 100% of Ethniki and includes the €120 million connected to reaching specific milestones in sales of bancassurance products by 2026.
Therefore the transaction of 90.01% takes the price to €454.5 million, and as the of NBG’s annual results pointed out, this constitutes a further loss for the bank’s fundamentals, which was not specified in Friday’s statement.
The completion of the deal brings NBG closer to fulfilling its commitments from the 2012 restructuring plan, as updated in 2015, according to which the group had to depart from any non-banking sectors. NBG sources say that failing to satisfy those obligations might have meant that the state support would be deemed illegal by Brussels.