ECONOMY

In Brief

Banks are solvent but facing problems Greek banks are solvent but face liquidity problems and need the government’s support plan, Greek central bank Governor Giorgos Provopoulos said yesterday. «Greek banks are solvent, healthy and stable but there is a liquidity problem,» he told a news conference. «If the Greek government had not stepped in, then we would face the risk of a severe credit squeeze.» Last week, Greece approved a 28-billion-euro ($36.05 billion) bank bailout plan aimed mainly at pumping money into a slowing economy. Greek banks have had little exposure to toxic assets and have suffered no write-downs. But they have ventured into faster-growing Eastern European markets, where profits have been squeezed as the global crisis begins to hit emerging markets. «We have recommended to banks to coordinate their credit expansion in the Balkans with local markets,» Provopoulos said. «They cannot take money from Greek depositors to fund these markets.» (Reuters) MIG shareholders OK 5-billion-euro share sale Marfin Investment Group SA, the biggest buyout fund in Southeast Europe, got shareholder approval to raise 5 billion euros ($7 billion) in a share sale to finance acquisitions, with new conditions. The new shares to be issued will have a minimum price of 5 euros apiece, according to an e-mailed statement from the Athens-based company. The price will be reassessed in accordance with the company’s net asset value at the time they’re issued, according to the statement. The final price will be decided by the board through «an extensive and structured international bookbuilding exercise,» the statement said. The intention is to get the price as close as possible to the previously announced 6 euros. The board was also authorized to complete the share sale within the next 12 months either in full or in tranches, while «alternative structures to the issuance of common equity may be also contemplated,» the statement said. Marfin Invest, backed by government-run Dubai Financial LLC, is seeking to raise money to pursue regional acquisitions, particularly in the banking industry, as share prices dive amid the global credit crunch. (Bloomberg) Fourlis forecast Fourlis SA, the Ikea franchise-holder for Greece, Cyprus and Bulgaria, lowered its full-year earnings forecast as sales start to slow and after nine-month profit was little changed on costs to open new stores. Sales since October have been below forecasts and the slowdown will continue to the end of the year, Athens-based Fourlis said in an e-mailed statement yesterday. It expects annual net income to rise 18 percent to 55 million euros ($71 million), down from an earlier forecast of 64 million euros. The company predicts sales for the year to increase 16 percent. (Bloomberg) Ellaktor gains Greece’s largest construction group, Ellaktor, is seen posting a 36 percent drop in nine-month net profit, as strong gains from the sale of two assets in 2007 were not repeated this year. Six analysts polled by Reuters forecast an average net profit of 67.8 million euros ($87.29 million) in the first nine months of the year, down from 105.8 million in the same period last year. Last year, Ellaktor booked gains of about 54 million euros from the sale of two assets. (Reuters)