ECONOMY

ATE staff is set to join the IKA fund

Workers at Greece’s ATE Bank are set to be included in a new state-controlled supplementary pension fund in a move that will reduce the bank’s pension contributions, an ATE Bank source said yesterday. Workers late on Thursday approved the inclusion of staff in the country’s main pension fund IKA starting January 1 as part of the government’s social security reforms in the banking sector. «The inclusion of the main (workers) pension fund in IKA is the first step. This will be followed by a consensual process in which staff will take part (leading to) their inclusion in the single supplementary fund,» the source told Reuters. Earlier this year, ATE Bank, 84.5 percent state-owned, completed a 1.24-billion-euro ($1.52 billion) rights issue to shore up its equity capital, eroded by large loan-loss provisions and unfunded pension liabilities as a result of the adoption of international accounting standards (IFRS). In June, lawmakers passed the government’s bank pension fund reform bill, setting the stage for the inclusion of all banks in IKA and the creation of a single fund to replace the 11 separate deficit-ridden supplementary funds in the banking sector. Bank employees had held a lengthy strike to protest the bill, although opposition eased after the bill was passed. «ATE Bank’s contribution to both the main and supplementary pension funds will be lower, benefiting the bank,» the source said. Greece is set to sell 10 percent of ATE Bank to local and foreign institutional investors by the end of autumn as part of its privatisation agenda, the bank’s vice-governor has said. (Reuters)