ECONOMY

Minister berates opposition for criticizing Emporiki sale

Credit Agricole’s proposal to buy out Emporiki Bank is «an expression of confidence in the government’s reforms and its efforts to solve the pension fund issue,» Economy and Finance Minister Giorgos Alogoskoufis claimed yesterday. Alogoskoufis has been fending off accusations by opposition Socialist MPs that the price agreed for the state to sell its 11 percent stake at Credit Agricole – 25 euros per share – is too low. Alogoskoufis yesterday counterattacked, saying that the original plan to make Credit Agricole a major shareholder in Emporiki and eventually hand its management over to the French bank was hatched in 2000 by then-finance minister Yiannos Papantoniou and the Emporiki chief, and Papantoniou’s former chief economic adviser, Yiannis Stournaras. Alogoskoufis called that decision a «strategic one» and asked the Socialists whether they were now fighting a decision made by their own government. When Credit Agricole had first become a major Emporiki shareholder, in 2000, it was given seats on its board and significant participation in the bank’s affairs through joint ventures such as Emporiki Life, Emporiki Asset Management, Emporiki Credicom and Hermes Mutual Funds. This participation not only gave Credit Agricole significant control over Emporiki’s operations, Alogoskoufis said, but also made it difficult to find alternative buyers for the bank. Alogoskoufis also remarked that, in July 2003, the Socialist government had formally asked Credit Agricole to buy 7,885,000 Emporiki shares (a 9.18 percent stake) at 15.31 euros per share, at a time when the stock was trading at 16.78 euros per share. Credit Agricole had refused back then. By contrast, he said, its current offer is at a 6.7 percent premium from the price of the share when the public offer was first made, on June 9 (23.44 euros) and 8.2 percent higher than the minimum acceptable price recommended by the government’s privatization adviser. Alogoskoufis finally admonished opposition MPs to stop «threatening» pension funds not to sell their Emporiki shares to Credit Agricole. «The main opposition persists with its irresponsible effort to undermine this (privatization) by using methods condemned by the citizens. Threats against the boards of pension funds and state agencies are unacceptable and invoke behaviors found in Third World countries. Greek society has overcome xenophobia, party cronyism and statism,» Alogoskoufis said. «Emporiki’s shareholders must calmly and rationally – based on actual economic facts – assess Credit Agricole’s public offer, just as the Greek state did. They must take into account (the offer’s) beneficial effects for the bank’s, and the Greek economy’s, growth. This is also true for the management of pension funds and state agencies,» Alogoskoufis added. On Monday, the government agreed to sell the state’s 11 percent stake in Emporiki to Credit Agricole. Pension funds hold around 20 percent of shares and their agreement is crucial to the success of Credit Agricole’s bid to become the majority shareholder. Today, the farmers’ pension fund and the auxiliary pension fund of the Social Security Foundation (IKA) are meeting to consider Credit Agricole’s offer. The Self-Employed Professionals’ Pension Fund also meets, for the second time, today. Meanwhile, Emporiki Bank unionists decided to extend their strike, which began Monday, until next Monday. They demand that Emporiki stay under the control of pension funds and state agencies and enterprises.