Piraeus Bank chairman Michalis Sallas expressed optimism about the course of Greece’s economy as well as certainty that the lender will cover the 10 percent minimum requirement for private participation in its share capital increase, as both Piraeus and Alpha Bank approved the issue of contingent convertible bonds (CoCos) on Thursday.
The two banks decided during general shareholders meetings to move ahead with the issuing of CoCos worth up to 2 billion euros, in the context of their privatization process. Their capital requirements, as defined by the Bank of Greece, are 4.57 billion euros for Alpha and 7.33 billion for Piraeus.
In contrast to market insiders’ expectations, Sallas appeared optimistic at the Piraeus shareholders meeting regarding the preservation of the lender’s private character. He stressed the economic climate’s spectacular improvement over the last six months and added that once the capitalization process is complete, combined with the general developments, the road will open for Greek banks to return to the international money markets within the year.
“Such a development,” Sallas stated, “would have particularly positive consequences on liquidity, as it would broaden the capacity of lenders to fund solvent companies and households.”
He also expressed optimism that besides Piraeus, other Greek banks will also manage to garner investor interest for at least 10 percent of their share capital increases so as to remain in the private sector, and will succeed in emerging from the crisis.
Meanwhile, the process for the transfer of Emporiki Bank has been completed between new owner Alpha and previous owner Credit Agricole of France. That will add capital of 3 billion euros to Alpha’s portfolio.