ECONOMY

Eurobank gets hold of credit line

EFG Eurobank took a step toward returning to the wholesale lending market on Tuesday by successfully completing a series of new funding agreements worth 1 billion euros using Greek government bonds as collateral.

The raising of the capital on the interbank market amounts to a vote of confidence for the domestic banking system and the broader economy, as it was achieved despite worsening conditions and lingering uncertainty concerning the outcome of the crisis.

The transaction was completed with four international lenders and is the first of its type completed by a Greek bank on the interbank bank market this year.

The amount of the loans, to run from three months to two years, relate to bonds with a nominal value of 1 billion euros.

According to Eurobank, the deal was completed with particularly competitive terms.

The spread on the euribor is in the range of 150 basis points (bps) to 200 bps, depending on the duration of each contract.

?EFG Eurobank?s agreements on the international market constitute the first opening for Greek banks to capital markets and are of large importance for the normalization of conditions on money and capital markets. As part of this effort, EFG Eurobank has organized tens of presentations in Greece and abroad in recent months to international banks, institutional investors, large private clients, international media organizations and credit agencies in relation to the bank?s prospects and those of the Greek banking system,? said Eurobank EFG deputy chief executive Nikos Karamouzis

?In these presentations we presented the favorable prospects of the Greek economy, under certain conditions, that take into account a series of positive factors for the country, such as the results of the fiscal adjustment, steps on the fiscal front, low lending in the private sector, the role of shipping, the dynamic behind Greek exports, the large potential for containing the gray economy and tax evasion, and the ability to develop property owned by the Greek state,? he added.