ECONOMY

Piraeus Bank also in talks to buy Greek units of Cyprus’s Hellenic, reports say

Talks in Athens are underway with regard to the absorption of Hellenic Bank, the smallest of three Cypriot lenders with branches in Greece, by Piraeus Bank, according to the Cyprus News Agency.

On Friday, the Greek Finance Ministry had announced that Piraeus Bank would take over Cyprus Popular Bank (Laiki) and Bank of Cyprus units in Greece but that Hellenic Bank would remain under Cypriot control.

However, representatives of Piraeus Bank were reported to be in talks on Sunday with regard to absorbing Hellenic as well.

Earlier, reports in Cyprus had suggested that the transfer of Laiki and Bank of Cyprus units to Piraeus Bank had been put on hold pending talks at the Eurogroup meeting in Brussels on Sunday evening. This was not confirmed, though.

With this acquisition of Laiki and Bank of Cyprus units, Piraeus Bank receives a loan portfolio of 19.5 billion euros and deposits of 12.5 billion, a network of 289 branches and some 5,100 new employees.

This makes Piraeus the second-largest pillar in Greece’s credit system, with assets exceeding 100 billion euros, a loan portfolio of 70 billion and deposits of 52 billion euros. The group will employ some 24,000 people and its network will exceed 1,700 branches, having also absorbed Geniki Bank and the healthy part of ATEbank as well as agreeing to acquire the Greek subsidiary of Portugal’s Millennium Group.

Piraeus agreed to acquire the branches of the Cypriot lenders for the symbolic price of one euro. Before their transfer to Piraeus, the local arms of the two Cypriot banks will be recapitalized to the tune of 1.5 billion euros, with 950 million coming from the HFSF and 550 million from the Cypriot government.