National is absorbing First Business Bank

Local lender First Business Bank on Saturday split into a “good” and “bad” bank, with National absorbing its healthy side and the rest set for liquidation, according to a statement by the Bank of Greece.

FBB followed the pattern set by Proton Bank and ATEbank by splitting in two. Its 19 branches across Greece will operate as normal from Monday, as they will form part of the National Bank of Greece group.

Bank of Greece explained that FBB split in two and had its license revoked after the lender failed to secure the funds required for its recapitalization. A tender followed and was awarded to National, which will be absorbing deposits of 1.24 billion euros, a loan portfolio of 1.23 billion euros and other assets worth 152 million euros, according to FBB’s figures on March 31. Provisions amount to 500 million euros.

To balance out the assets of 878.09 million euros, according to the Bank of Greece temporary estimate, with the deposits, the Hellenic Financial Stability Fund is paying 524.3 million euros to National from the recapitalization fund of 50 billion euros that is meant to secure the stability of the local credit system.

National said that it will continue to participate actively in the restructuring of the credit sector and welcomed FBB’s staff and clients.