NBG: At EUR 1.46 bn the objective of recapitalisation

NBG: At EUR 1.46 bn the objective of recapitalisation

Athens, November 17, 2015/Independent Balkan News Agency 

By Spiros Sideris

At EUR 1.456 bn decreased the capital needs of the baseline scenario of tests stress on the National Bank, as the Single Supervisory Mechanism ECB accepted actions included in the recapitalisation plan of systemic group, amounting to EUR 120 million.

Correspondingly, the total capital shortfall under the adverse scenario of the exercise was reduced to EUR 4.48 bn.

The benefit resulted from the positive impact of the results of the third quarter 2015, which were not taken into account for the purpose of the stress tests.

This means that the National Bank will need to obtain from the private sector EUR 1.456 bn, instead of the previous Euro 1.6 bn, in order to avoid forced consolidation procedures.

In addition, it was confirmed by the Single Supervisory Mechanism the option to repay part of the precautionary recapitalisation, which is provided with the issuing of contingent convertible bonds of l. 3864/2010 (CoCos), after the completion of the sale of Finansbank, according to the actual capital impact of the transaction .

This means that part of the capital needs of the adverse scenario would be covered by the Financial Stability Fund (FSF), activating the bail in for creditors of the bank who did not accept its public offer to exchange their securities with ordinary shares.

This will result, in this phase, in  converted into ordinary the preference shares of EUR 1.35 bn allocated in 2008, under the first industry bailout after the outbreak of the credit crisis.

According to these figures, the National Bank having secured a capital benefit of EUR 790 mln from the bond exchange and other securities, is invited to draw from the markets a minimum EUR 665 mln, while it has been decided that the issue of shares will not exceed EUR 1.6 bn.

This means that at the best scenario for the bank, the FSF will inject EUR 2.25 bn, of which EUR 1.69 bn in convertible bonds and other securities.

If through the private sector only covered the main scenario, namely EUR 1.45 bn, the FSF will contribute for the EUR 3 bn increase, with the EUR 2.27 bn exchanged for CoCos and the rest with common shares .

When the 100% of Finansbank is sold the bank will repay the above convertible securities, so as to get rid of their high voucher, which will be at 8%, costing EUR 135 to 180 mln annualy.

PRM of Alpha Bank oversubscribed

Alpha Bank Alpha achieved its target for the capital increase -8.57%, according to information from the market. The bank, however, intends to keep the open book of offers open today as well, to accept additional investors offers.

The group needed to raise EUR 1.55 bn from investors, as the SSM acknowledged the capital needs of EUR 180 mln, equally reducing capital needs.

The bank had already accepted the proposal for the bond exchange of reduced and main collateral nominal value of EUR 1.1 bn and the recognition of its positive balance in pre-prediction results.