By Lefteris Yallouros – Athens
Eurobank is the first Greek bank to officially return to the hands of private owners following the completion of a 2.86 billion euro share offering on Tuesday.
“The successful completion of Eurobank’s capital increase constitutes a vote of confidence to the prospects of our bank and of the Greek economy,” Eurobank CEO Christos Megalou said in a statement.
Greece’s third-largest lender was oversubscribed and priced at 0.31 euros a share. The 95 percent stake held by the Hellenic Financial Stability Fund will fall to about 35 percent as a result.
“We are satisfied that Eurobank’s offering attracted substantial capital from quality investors, including long-only funds and Sovereign Wealth Funds,” HFSF Chairman Christos Sclavounis said.
Greek Finance minister Yannis Stournaras highlighted the importance of Eurobank’s return to private investors to the economy. The mister said over 250 high-quality institutional investors expressed interest in the bank. Stournaras went on to emphasize that such a strong show of trust in the banking system will bring much needed liquidity to the economy and will restore depositors’ confidence.
Restructuring plan gets go-ahead
Meanwhile, the European Commission on Tuesday approved the restructuring plan of Eurobank Group and said the plan was in line with European Union state aid rules.
The EU’s executive arm, in an announcement said that the plan – set to run through 2018 -will enable the bank to become viable in the long term without unduly distorting competition.
The Commission has also approved Eurobank’s acquisition of Nea Proton Bank and New Hellenic Postbank, whose integration within Eurobank will reinforce the viability of the group without unduly distorting competition.
Joaquin Almunia, vice-president of the Commission in charge of competition policy, commenting on the approval said that “the restructuring of Eurobank is an important step forward for the Greek banking sector. The restructuring plan approved today reinforces the viability of the bank and ensures that it will be strong enough to support recovery in Greece by providing credit to the real economy”.
Moody’s upgrades Greek banks
The Greek banking system as a whole received another vote of confidence Tuesday as credit rating agency Moody’s upgraded the outlook of the country’s banks from “negative” to “stable”. Moody’s said the change was “reflecting expectations of a return to growth of the domestic economy in 2014-15 after six years of contraction.”
The upgrade spurred the Athens Stock Market to a late rally that gave the benchmark marginal gains on Tuesday. The Athens Exchange general index closed at 1,195.20 points, adding 0.10 percent to Monday’s 1,193.95 points.