ECONOMY

2011 will be year of bank mergers

The head of Greece?s central bank said on Thursday that he expects consolidation activity in the banking sector this year as lenders will be forced into taking steps to get through the sovereign debt crisis.

“Banks are at a difficult stage because of the fiscal crisis, 2011 will be a year of reshuffling, which means mergers and cooperation,» Bank of Greece head Giorgos Provopoulos said after meeting with President Karolos Papoulias.

?I believe that they won?t delay in doing this,? he said.

The latest merger attempt came from National Bank, the country?s largest lender, last month when it offered to hook up with smaller rival Alpha in an all share deal worth nearly three billion euros.

Alpha Bank rejected the offer on the grounds that it wasn?t in the interest of its shareholders.

Banks were trading 0.32 percent lower on the Athens bourse in mid session trade on Thursday, versus losses of 0.24 percent in the broader market.