ECONOMY

Emporiki signals interest in TT, others certain to follow

Emporiki Bank, Greece’s fourth largest by assets, yesterday fired the opening shots in the next major realignment of the Greek banking sector, by indicating its conditional interest in participating in the tender for a stake in the much-coveted, state-owned Postal Savings Bank (TT). «We shall first wait to see the offer. We are interested in TT but under certain conditions,» Emporiki President Yiannis Stournaras told a news conference in Thessaloniki. Economy Minister Nikos Christodoulakis has rather vaguely spoken of a «part-denationalization» of TT. This is not the terminology usually employed and fails to throw adequate light on the government’s exact intentions, but it is considered a given that the tender will be for a minimum stake of around 34 percent in TT. What makes TT attractive is its sizeable and largely «untapped» clientele, numbering about 2.7 million of small savers with total deposits in excess of 9 billion euros, its bond portfolio of about 8 billion euros, considerable real estate assets, a small and relatively «clean» loan portfolio of about 2 billion and a capital adequacy ratio of 24 percent. It is projected to report income of around 300 million euros for its first, 12-month-plus fiscal period to December 31, 2003, since being converted into a societe anonyme. The government, as shareholder, this year received a sum of about 160 million euros as dividend for 2002. However, as Stournaras made evident, much will depend on terms of sale. «We need to see what size of investment is needed for the modernization of TT, the age distribution of employees, the kind of social insurance status they will have,» he said. He indicated that Emporiki is targeting a majority stake, which would enable it to absorb TT. «I will reserve judgment until the tender is issued, but as things stand at the moment, Emporiki would like to see an offer of at least 51 percent in order to participate.» The TT sale is seen as certain to attract the interest of most major Greek banks and the acquisition of a major stake, even a minority one initially which could be enlarged later, is bound to lead to a realignment of market shares and a new equilibrium. EFG Eurobank Ergasias, Greece’s third largest by assets, is already reported to have made its interest known to the government. The biggest, National Bank, is said to be studying the matter seriously, while Alpha Bank has not ruled out its participation. If Emporiki is the winner, it will move up to second position from fourth. If Alpha is successful, it will stay in second place but only a breath behind National. Whatever the content of the tender, the TT sale is not projected to be a piece of cake for Economy Minister Nikos Christodoulakis, who is under pressure from various quarters opposing the prospect. TT labor unionists, a number of ministries including Transport and Communications, which is TT’s supervisory authority, and top ruling party officials are said to have formed an impromptu alliance against the sale – each side for its own reasons. It seems certain, however, that the prime minister, Costas Simitis, has already made up his mind on the sale.