Four Greek banks to see goverment aid

Four Greek banks to see goverment aid

ATHENS - Agence France-Presse
Greece’s central bank has said the country’s main four lenders would be recapitalized separately, a move that raises questions about a planned merger between two of them.

“The Bank of Greece confirms that the recapitalization process for the four systemic banks (National Bank, Alpha, Eurobank, Piraeus) is proceeding normally and will conclude in April in any case,” the central bank said on April 7. “All four banks have already called - or will call in the coming days - shareholder meetings to approve capital increases,” it added.

National Bank and Eurobank are in an advanced merger process that foresaw a joint recapitalisation. But Greece’s creditors -- the EU, IMF and the European Central Bank -- had reportedly expressed concern that the new entity would both dominate the Greek market and would be tough to recapitalise.

“The creditors do not like the creation of such a major player with a market share of around 40 percent,” Bank of Greece governor George Provopoulos said in a recent televised interview.

“The troika says, and I can also say, that there will be a greater difficulty in a combined National Bank-Eurobank entity, with capital needs in the order of 1.5 billion euros or slightly higher, a very large sum under the current circumstances. So there is a concern that if private investors cannot be found, it will come under state control,” he told state television NET.

The Bank of Greece announcement came after new talks between the creditor representatives and Prime Minister Antonis Samaras.