The planned privatization of Emporiki Bank, Greece’s fourth largest, is expected to be the linchpin of historic realignments in the country’s banking sector in 2006. France’s Credit Agricole, which already owns 9 percent of Emporiki, is largely considered to have lost the lead in the acquisition of a majority stake and there is now strong interest from Greek banks, including National, the country’s largest. If the winner is a Greek bank, this is projected to intensify pressures for the privatization of the Postal Savings Bank (PSB) – which has a very wide network – in order for the balance to be redressed. PSB is expected to be listed on the Athens bourse within the first half of the year. The future of the Bank of Attica, a smaller player, appears more predictable. The government’s stake will most likely be transferred to a social security fund. The partial privatization of ATEBank is projected soon, probably before April, and depends on stock market conditions. The government, which has an 82.36 percent stake in ATE, wishes to initially sell 15 percent and later reduced its share to 51 percent. There are also extensive deliberations under way among mid-sized and small banks, which are seeking to position themselves in view of the oncoming changes. An important parameter of the realignments in the banking sector will be institutional changes. Beyond the new capital sufficiency requirements dictated by the Basle II agreement, many European Union regulations are expected to be incorporated into Greek law, affecting the way banks operate today.