NBG raises recap expectations

National Bank is hoping to raise the level of private participation in its share capital increase from 10 to 12 percent.

After evaluating the response by shareholders and other investors to its invitation to take part in the bank’s recapitalization, it has decided to aim higher, above the necessary threshold of 10 percent that will allow NBG to avoid nationalization. If the target of 12 percent is attained, then the bank will not have to issue convertible bonds (CoCos).

The bank’s board meeting on Thursday decided to propose the revision of the target at Monday’s general shareholders meeting, as the interest expressed in the share capital increase will likely exceed the required 975.6 million euros, or 10 percent. The new target for the increase in cash from private investors will be 1.17 billion euros.

According to the management’s plans, if the target of 12 percent is indeed met, the warrants for the future acquisition of shares will correspond to 7.33 additional common shares for every share that will participate in the increase. The 10 percent participation of the private sector would have entailed a ratio of one share for nine warrants.

Increased private participation would also allow for more investors to participate in the recapitalization. NBG sources said that the bank’s shareholders currently number 250,000, including the 70,000 shareholders of subsidiary Eurobank Ergasias who have exchanged their shares for those of National.

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