Alpha Bank to give up the merger with Eurobank EFG
The Greek Alpha Bank will offer its shareholders to abandon the merger with Eurobank EFG. The news came from the Alpha Bank’s release to the stock exchange operator in Athens, quoted byReuters, in which the bank calls a shareholders' meeting. The motive is the exchange transaction of Greek bonds between the State and its private creditors, which will lead to higher losses for the banks than expected at the time when the merger was approved. According to an analysis of Alpha Bank, the operation for the exchange of the Greek debt would exert a disproportionate impact on the two financial institutions. While Alpha Bank’s exposures in Greek sovereign debt amount to €3.1 bn, those of Eurobank are twice larger - €6.9 bn. Both institutions are presented in Bulgaria - Alpha bank operates through its branch company and Eurobank is the owner of Postbank.
"The Board of Directors of Alpha Bank will convene a general meeting of shareholders where it will offer them to withdraw their votes from the merger decision," announced a spokesman of the financial institution yesterday. It is expected for the meeting of the Board of Directors to be held on 27 March. According to an unnamed senior source from Eurobank, the merger would be profitable. "We believe that the deal makes sense, but if Alpha does not want it anymore, we can not expect a forced marriage," he said.
Both institutions are presented in Bulgaria, but their market positions are different, compared to those of the Greek parent banks. Postbank ended 2011 with a profit of over BGN 15 mln, and Alpha Bank was among the institutions which incurred a loss of BGN 44 mln. Yesterday, in Athens, the shares of the Greek Alpha Bank increased by over 5% and those of Eurobank EFG – by over 2%.
Text and photo: http://www.klassa.bg
(15.03.2012)