The first negative impact of the Greek bond swap (PSI): Greek Alpha Bank seeks to call off its intention to merge with EFG Eurobank. The merger would have created Greece’s largest bank and was seen as the first step in an expected consolidation of the Greek banking sector.
Alpha Bank seeks to Call off merger with Eurobank
Alpha Bank Greece΄s third largest lender by assets, said Wednesday that it will call a meeting of shareholders to scrap merger plans with cross-town rival EFG Eurobank Ergasias.
In a filing to the Athens stock exchange, Alpha said it had already communicated with the management of Eurobank informing them of its intentions, according to Dow Jones Newswires.
Shareholders of the two banks had approved the merger at twin meetings in November last year. The merger would have created Greece΄s largest bank and was widely seen as a first step in an expected consolidation of the Greek banking sector.
But Greek banks are facing enormous losses after Greece΄s government implemented a massive EUR100 billion debt write-down aimed a easing the country΄s public sector debt burden.
In late January, Alpha Bank, which holds a much smaller portfolio of Greek government bonds than Eurobank, froze the merger process and indicated that Greece΄s debt restructuring plans could overturn the benefits for the merger.
Alpha Bank statement.
The announcement:
Pursuant to a previous market announcement and following the conclusion of the exchange offer of bonds issued or guaranteed by the Hellenic Republic (Private Sector Involvement – PSI) and its effects on the banking sector, Alpha Bank informed Eurobank EFG that it intends to propose to its forthcoming Board of Directors to convene a General Meeting of its Shareholders to resolve upon the revocation of the decisions of the General Meeting of its Shareholders dated 15 November 2011.
Source: Capital.gr
