The Hellenic Financial Stability Fund (HFSF) and Eurobank completed negotiations and signed the agreements late on Monday for the absorption by the state-controlled lender of Proton Bank and of Hellenic Postbank, both awarded to Eurobank late last week.
Regarding the transfer of Hellenic Postbank (TT), which was decided on Saturday evening, the HFSF announced on Monday that “the final decision factored in parameters such as the conditions of offers, the long-term maximizing of benefits for the overall portfolio of the HFSF as well as systemic stability. The price offered will be paid in Eurobank shares to be issued for this purpose.”
For the acquisition of TT, Eurobank will pay the HFSF 681 million euros through the issue and transfer to the fund of new shares, whose exact number will be determined according to the average price of Eurobank’s stock on the Athens Exchange during the last 10 days before its extraordinary general meeting, with a minimum of 1,418,750,000 shares. That will further raise the HFSF stake in Eurobank, which currently stands at 93.6 percent.
Also bidding for TT were National Bank, Alpha Bank and the Piraeus Group through Geniki Bank. Eurobank’s chief executive, Christos Megalou, said that “our target remains the successful return of Eurobank to the private sector.”
According to Eurobank, after the acquisitions of TT and Proton it will employ 20,115 people and have a total network of 1,261 branches and a presence in seven countries. Total assets are growing by 23 percent, to 79.3 billion euros. The transactions also bolster considerably the group’s portfolios, as its deposits will grow by 12 billion euros, which is 4.2 billion euros more than the increase in the loans portfolio. Therefore the loans to deposits ratio will improve from 132 percent to 114 percent.
In total the synergies from the two acquisitions are estimated at 200 million euros on an annual level from 2015 onward, while the current value of total synergies amounts to about 800 million euros.
Greece had a deadline until mid-July, i.e. Monday, to complete the transfers of Proton and TT according to its commitments to its international creditors.