The country?s major lenders are bracing for a big battle over the acquisition of Emporiki Bank, after National and Eurobank EFG confirmed their interest in the French-owned bank on Wednesday.
The two lenders said they intend to submit an offer in response to a question by the Capital Market Commission, making it clear that they have not yet submitted any offers to owner Credit Agricole. Their statement came just one day after rival Alpha Bank acknowledged that it has already submitted a bid to buy out Emporiki.
The managements of both banks — in cooperation with their consultants — are examining economic data and quantifying the synergies they could look forward to by absorbing Emporiki before submitting their final offers.
What makes Emporiki such a prized asset is that its buyer will not pay but get paid for it. For Emporiki to be sold — which is said to be a priority for parent group Credit Agricole — it will first have to be recapitalized, which, according to a study by BlackRock, will require 2.5 billion euros.
Local banks are also asking the French group to strengthen the new bank that will emerge from the acquisition with additional funds due to the deep recession and the further deterioration of loan portfolios. In exchange for that the French may get a small stake, possibly close to 5 percent.
Analysts suggest that the acquisition of Emporiki by Credit Agricole has been one of the worst investments the French bank has ever made, as it has cost billions in funds, to say nothing of the energy wasted and the huge problems it has generated for the group?s management.
Any one of the three major Greek lenders to buy out Emporiki will decisively increase its size and weight in the credit market, as well as benefiting from the additional funds that Credit Agricole will contribute. That way it will require fewer funds in the context of recapitalization. In end-2011 Emporiki boasted assets of 21 billion euros, its loans amounted to 19 billion and deposits to 11 billion. Its group employs 5,200 people.