ECONOMY

ETBA embezzlement losses estimated at 10 bln drs

State-controlled ETBA Bank said yesterday that funds misappropriated at its subsidiary ETBA Finance could be lower than an initial estimate of some 10 billion drachmas (29.35 million euros). The bank discovered the embezzlement last Friday during an audit of its subsidiary in connection with the sale of a majority stake to privately held Piraeus Bank. ETBA Finance liquidates the assets of ailing companies on behalf of the state. ETBA Bank said in a statement yesterday that the loss to the bank is estimated at about 10 billion drachmas, although the full extent will not be known until after the financial crime squad has completed its investigation. It said the damage could be smaller should part of the missing funds be located. The bank said the embezzlement does not affect its overall capital, which exceeds 300 billion drachmas (880.4 million euros). Nor is it expected to have a negative impact on the sale of a 57.8-percent stake to Piraeus Bank as the loss will be deducted from the sale price. ETBA also assured that the sale of Hellenic Shipyard to German shipyard HDW would go ahead notwithstanding the problem at its subsidiary. ETBA holds a 51-percent stake in the Greek shipyard. The boards of directors at both ETBA and HDW over the weekend approved the contract signed last October on the sale of Hellenic Shipyard to its German counterpart. The parties expect to receive the green light from the European Commission for the transaction in about a month. ETBA also announced the appointment of a former manager, Panayiotis Iliadis, as the managing director of ETBA Finance, replacing Spyros Stephanatos, who was suspended from his post last Friday. Others temporarily removed from their posts include general manager G. Karayiannidis, chief accountant Dimitrios Frangodimitropoulos and financial officer Georgia Sbarouni. Prosecutor Isidoros Doyiakos yesterday launched a preliminary investigation into ETBA Finance. The financial crime squad has initiated a probe into the ETBA subsidiary and AVAX Securities. DRY CARGO