National re-nationalized?

For the first time in several years, the Greek State is again poised to become the largest single shareholder in the National Bank of Greece. Next July, a state 775-million-euro bond loan, exchangeable in National Bank shares, expires, and the bonds are to «return» to state portfolio management company DEKA. When the bonds – or share-exchangeable certificates – were issued and sold mostly to foreign investors through bookbuilding, the exchange price was set at 27,912.06 drachmas (81.91 euros). This was near the peak of the Athens Stock Exchange boom. Since none of the certificate holders will buy shares at this price, DEKA will be required to do so. Yesterday, National’s shares closed at 10.82 euros. At present, DEKA owns 10.92 percent of National. The State owns directly another 3.25 percent, making its total holdings 14.17 percent. In July, DEKA will acquire another 10 percent, though at an exorbitant price. Pension funds, whose votes are indirectly state-controlled, own 17.27 percent of National Bank. If one adds that amount to the State’s holdings and includes the shares found in the portfolios of National’s subsidiaries, the State may well become a majority shareholder in July. At present, the State owns only Agricultural Bank and is a major shareholder in Emporiki Bank (formerly named Commercial Bank), where it holds a 9.46 percent stake and, through pension funds, controls another 24.29 percent. It will also soon acquire a stake in Piraeus Bank – about 2.5 percent – when the latter completes its merger with ETBA bank. The State, a former majority owner of ETBA, retains a 7.8 percent stake.