ECONOMY

In Brief

OTE union will fight for permanent employee status Phone company OTE and its trade unions are set to clash over management’s attempts to cut costs by no longer granting civil-service status – which makes layoffs essentially impossible – to newly hired employees. «We cannot and will not agree to changes that in one way or another cast doubt on or abolish our basic employee rights,» the company’s main union OME-OTE said yesterday in a letter to OTE Chief Executive Panayis Vourloumis. The letter was also sent to Greece’s finance, labor and transport ministers. Earlier this week, Vourloumis proposed to unions that new employees not be given the civil-servant status currently enjoyed by OTE’s work force. OTE, 37.7 percent state-owned, is negotiating with unions on its plans to cut 4,500 jobs this year via voluntary redundancies, with projected annual savings of 225 million euros ($294 million), as part of a radical overhaul to trim costs and shore up profits. Vourloumis proposed that new workers be hired on contracts with an indefinite term and that managers be subject to possible firing if they do not properly exercise their duties. Last August, he said the operator’s 17,000 employees could not be removed, punished, rewarded or motivated because of their civil-servant status, which in effect gives them permanent tenure. The unions criticized Vourloumis’s attempt to link OTE’s voluntary redundancy plan with changes in work conditions. «We had your assurance as well as the government’s that any deal on voluntary redundancies would not involve issues that reverse the existing work regime,» OME-OTE said in its letter. OTE’s shares gained 26 percent last year on hopes of a successful restructuring. The stock has added 4.7 percent since the start of the year. (Reuters) Central banker once again warns on credit expansion Bank of Greece Governor Nicholas Garganas yesterday warned the Hellenic Banks’ Association (HBA) he would raise provisions for defaulting consumer loans. Garganas emphasized the deteriorating situation in personal loans, which an increasing number of people fail to repay on schedule or default altogether. Bank of Greece officials fear that the intensifying competition among banks for clients have led them to overlook the risks inherent in rapid credit expansion. Garganas’s warning, which he has repeated in the past, was prompted by the arrival, next month, of a team of International Monetary Fund experts that will assess Greece’s financial system. HBA officials said that all banks comply with capital requirements. IPOs approved The Athens Stock Exchange yesterday approved three initial public offerings for listing on the bourse’s main and small-cap markets. Piraeus Real Estate Investments will be listed on the exchange’s main market – the first such listing, the bourse said. Mediterranean Foods SA, which puts out the Delicia and Brava bakery brands, and Moto Dynamiki SA, an importer of jet skis and outboard engines, will be listed on the small-cap market. The exchange said the IPO prospectuses will be forwarded to the securities regulator for approval and the green light for going public. (Reuters)