National Bank-Eurobank merger postponed

Following the meeting, it was announced that National Bank and Eurobank will “pass” to the Financial Stability Fund, which “nationalises” the two banks. As a basic shareholder of the two banks, the Fund will be called upon to decide whether a merger plan by the two banks may go ahead at a later stage

After a Bank of Greece announcement earlier on Sunday evening – on which the troika heads have agreed- the managements of the two banks have sent, according to government officials, to the Bank of Greece letters in which they stated that it was not probable that they could “bear” the ten per cent burden required for their separate recapitalizations.Therefore, the Financial Stability Fund will immediately launch the necessary processes in order to take hold of them and proceed to their recapitalization.

According to a Greek Finance ministry official, all procedures for the merger between National Bank and Eurobank are postponed, while the final decision for their merger or not, will be taken by the Fund being the basic shareholder. The fund, according to the official, can take any decision it deems fit, based on existing criteria.

Finance minister Yannis Stournaras categorically stated, following these developments, that “deposits in Greek banks are absolutely secure.” amna

Immediately after the end of the meeting, Finance ministry sources said that there shall be a new meeting at 4 p.m. on Monday, while the statement made at noon by the Finance minister that considerable progress has being achieved, however open issues still remain, was valid in full.

It is noteworthy that the troika has raised objections over the merger, believing that the new bank’s assets will amount to about 170 billion euros, almost equal to the country’s GDP.

source:AMNA