Troika insists on swift sale of banks

Greece’s creditors are asking the government to commit to selling any lenders to be recapitalized only by the bank support fund (HFSF) as soon as possible, according to sources.

The representatives of the European Commission, the European Central Bank and the International Monetary Fund – known as the troika – are asking the Greek authorities to promise they will complete the procedures for the sale of those systemic banks to private investors by September. The Greek side is trying to avoid setting a clear deadline in order to maintain greater flexibility, or at least to get a year-end deadline.

The ideal case for a swift transfer back to the private sector is Eurobank, if it fails to find private funds amounting to 10 percent of the share capital increase in the context of its recapitalization. Given its status as a 100 percent private bank, once it comes under the control of the Hellenic Financial Stability Fund, it should be easier to get a private investor to buy it.

Eurobank officials have told Kathimerini that in the case that the 10 percent threshold is not reached, the first priority of its management will be to search for investors from the day after it is recapitalized, so as to become the first lender to be passed on to private interests. They add that the privatization of the bank in the fall would issue a strong message of optimism for the country and its credit system.

However the troika is also applying pressure for the swift sale of National Bank, Greece’s biggest lender, in case it comes under the full control of the HFSF. In a message to the bank’s employees, National’s chief executive Alexandros Tourkolias stressed yesterday that the bank’s management is approaching the recap issue positively.

A thorny point will be that of the price the banks will be sold at after being passed into the hands of the HFSF. The price will be considerably lower than the funds needed for their recap. The government’s agreement with its creditors had suggested that out of the 50 billion euros set aside for the bank recap, some 16 billion will be retrieved through the sale of the banks.

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