National’s recap in final stretch

The recapitalization of the National Bank of Greece has entered the final stretch after the Capital Markets Commission on Wednesday approved the lender’s bulletin regarding its share capital increase, making Thursday the last day of trading for the bank’s old stock on the Athens bourse.

Trading of National’s stock will cease as of Friday and for a total of four sessions as the lender launches a 10-to-one reverse split allowing investors to start buying and selling National’s shares again from Thursday, May 30. The price of the new share will be at a new level, while the warrants for the buyback of the shares after the recapitalization is complete will trade separately.

Stock analysts say that the adjusted share price from next week will be higher than the price at the issue of the new chips, i.e. 0.429 euros before the reverse split and 4.29 euros after the reverse split. This corresponds to a stock value totalling close to 10 billion euros.

Analysts and institutional portfolio administrators have expressed their optimism over the successful completion of the bank’s share capital increase. Sources also say that a great number of investors and entrepreneurs have expressed their interest in acquiring shares in National, with many already having made committments to participate in the process.

There is also considerable interest by existing shareholders as the improvement of conditions in the local economy and expectations that Greece will gradually see a turnaround have boosted morale and improved the overall climate.

Any improvement in the economy will be positively reflected on the banking sector, while the warrants to be issued are expected to multiply potential yields for shareholders. In the context of the increase, existing stakeholders as well as anyone acquiring warrants will be able to buy 2.2 new shares for every share they hold, worth 4.29 euros after the reverse split.

For instance, a shareholder who today owns 100 shares will get 10 shares after the reverse split and will be entitled to acquire 22 new shares by participating in the share capital increase, paying 4.29 euros per share for a total of 94.38 euros.