Greece’s Piraeus Bank said it will pay 95 million euro to acquire the healthy assets and liabilities of state lender Agricultural Bank (ATEBank), a deal that was announced by the Central bank of Greece on Friday.
According to Piraeus Bank statement released on Monday, the country’s four-biggest lenders acquires from ATE Bank, 14.7 billion euro in assets and 21.4 billion euro in liabilities, including 14.3 billion in customer deposits. (see also WSJ)
The new Piraeus-ATE bank will need recapitalisation of a total of 8 billion euro from Financial Stability Fund. It has already received 4.7 billion euro and it would need 1.8 billion more without the deal. Piraeus will receive 1.5 billion for the recapitalization of the healthy ATE part.
Piraeus Bank said further that it will keep the jobs of 5,300 employees of ATE Bank as that was one of its commitments to secure the deal. The number of employees in the the new group in the Greek banking will rise to a total of 17,000 people, 1,230 branches and presence in nine countries outside Greece.
According to economic news portal Capital.gr, ATE bank employees will have to sign work contracts with the new employer after they’re ‘fired’ by ATE and be re-hired by the Piraeus. Their compensations are estimated 90 to 95 million euro.
Piraeus Bank acquires the healthy assets. The Greek people end up paying for the bad ones.
This “Good bank-Bad Bank” scam is exactly that.
Bankers end up with everything worth something, the people end up paying for the losses those same bankers made and now don’t want. Similar situation in Ireland, where the “cheapest bank bailout in history (dixit the previous FinMin) ended up costing the Irish tax payer billions. And guess who’s managing those “bad assests”? The same guys who created them!
Corrupt gangsters who took the Irish people for billions are now being paid up to 200,000€ a year by the Irish state for “managing” their own corruption. And just in case, no this is not an intro to some fctional comic. It’s the reality of the mess we’re all in.
Greeks, you’ve been conned, again!
My blood boils with the whole situation!
“ATE bank employees will have to sign work contracts with the new employer after they’re ‘fired’ by ATE and be re-hired by the Piraeus. Their compensations are estimated 90 to 95 million euro.”
Are they kidding us or what??? Nevermind the rest of the comments I have in mind… KTG won’t be able to post them 😛
“KTG won’t be able to post them” hm… I wouldn’t be so sure. No-no words by a female KTG-ian might be …refreshing for a change 🙂
Apart from new vocabulary, what I want to know is whether the loans to ND and PADOK (a total of some 200 million I believe) are part of the “good” assets or are they considered “bad assets”?
I think I read they’re part of ‘bad bank assets’ – I may post about later.
Thought as much. And who will end up paying for these? Are we looking at another pension cut or so to pay for the political parties who created this mess?
Do a little search on NAMA, set up to manage the bad “assets” and the Irish Bank Resolution Corporation, the bad bank manging the bad loans. It’s actually Anglo Irish Bank, the bank that casued the whole crash, under a new name! Nothing else. And see how much it is costing the Irish TAXPAYER, instead of the guys who created the mess. Have the sick bags handy…
Will Greece be any different? Why would it be? Ireland was the testing ground for good bank-bad bank, Greece is the testing ground for Austerity, Spain is the testing ground for the sovereign debt v. bank debt argument, etc etc. And once it’s all finely tuned and ready to go, we’ll all get it properly in the neck. Unless we stand up and say “Enough”.
ATE is another rousfeti broker of the political elite. It’s through mismanagement and incompetence that it has reached this pitiful end. The deal may be dirty but at least it puts an end to the black hole of expense in keeping it afloat. In its entirety it was worthless and no one would purchase it. Of course the taxpayer will pay for it again, but haven’t they been paying up until now anyway? This way the bleeding stops, no?
The Irish, American, Spanish, Estonian, Lituanian and probably a lot more people’s experience says “no”, the bleeding keeps going. In the Irish case, which I’m familiar with, so far 96 billion €, and counting. And they are now talking another 35 billion or so, at least…
In fact, they already stated that they will “have to” keep it going for another 10 years. Meaning, Paddy will be paying for another 10 years or so.