One step before the complete disinvestment from the 4 systemic banks is the Financial Stability Fund (HFS) after the successful disposal of all the shares it held in Piraeus Bank. In this way, the cycle of recapitalizations in the Greek banking system will be officially closed and, by extension, for the Greek economy, which is showing resilience as, despite the new challenges, it is moving at a growth rate four times that of the eurozone average.

The HFSF has fully divested from Eurobank, Piraeus Bank, Alpha Bank while maintaining a percentage of approximately 18% in National Bank and a percentage of around 70% in Attica Bank.

In particular, as pointed out after the completion of its divestment Ths from Piraeus Bank from the government’s financial staff, the Thsthe Bank of Greece and financial analysts, this fact is a vote of confidence from the international investment community, not only for the Greek banking system, but also for the Greek economy.

As he pointed out the Minister of National Economy and Finance, Kostis Hatzidakis, on the occasion of the successful completion of the sale of 27% of Piraeus Bank shares to foreign and Greek investors, our banking system is changing the page from today. “From the time of the crisis and the recapitalizations, to the time when high-quality investors express, as was seen in the last months, their interest in all systemic Greek banks, said the minister, pointing out the fact that the investment interest expressed was 8 times greater than the offer. He also pointed to the fact that the sale price of the shares was set at levels higher than the closing price of the Stock Exchange last Friday, before the start of the process. “Which is extremely rare worldwide, as in such cases of mass distribution of shares the prices are almost always set at a discount in favor of the buyers, said the minister. To add: “The latest developments reward the strategy of the HFSF management which prepared and organized the process effectively. They underline the correctness of the government’s choices, not only for the way and the time the disinvestment of the State proceeded, but also more generally for the banking system itself. And they are, after all, a very serious national success.”

The successful cycle of disinvestment of the HFSF from the systemic banks started with Eurobank and was followed by Alpha Bank, National Bank and Piraeus Bank.

According to data presented by the Minister of National Economy and Finance Kostis Hatzidakis to the Parliament (February 2024), the State has not only an accounting but also, above all, a more general benefit from disinvestment.

According to these figures, for the rescue of the four systemic banks, the Greek State – through the HFSF – has paid a total of 30.9 billion euros, while the benefit it had is:

  • 28.2 billion from clipping bonds (PSI program) held by the 4 systemic banks.
  • 3.8 billion euros from the redemption of convertible bonds (CoCos).
  • 2.8 billion of disinvestments made to date (March 2024) without the program being completed yet.

The general total is 34.8 billion euros, that is, the benefit of the State in relation to the 30.9 billion it gave for the recapitalization is 3.9 billion euros, not counting the 2013-2023 dividends, amounting to 5, 5 billion euros paid by the Bank of Greece to the State, mainly due to the provision of extraordinary liquidity support to the banking system through the ELA.

By saving the systemic banks, of course, the deposits of the Greek citizens were also saved, which were approximately ten times the cost of the recapitalization, and businesses and households were protected from collapse. Speaking to Parliament on February 19, Mr. Hatzidakis emphasized that the results of the disinvestment in Eurobank, Alpha and National Bank prove the correctness of the government’s choices.

National Bank: the most successful public offering of shares in recent years, at European level

In the case of National Bank, according to data from the HFSF, the disinvestment of 22% of the HFSF by the National Bank is recorded as the most successful disposal of shares through a Public Offering in recent years, at the European level. The electronic offer book was fully covered for the first time just 20 minutes after opening on 13 November 2023 setting the tone for the demand and appetite of investors to place in the NBG. The final over-coverage, more than 8 times the average for the international and the Greek book, confirmed the strong intention of the investing public to put the shares of Ethniki in their portfolio. The international book was covered 9.5 times, attracting leading institutional investors, mostly from the US (35%) and the UK (47%), with total assets under management of more than €30 trillion. The quality of international investors is also characterized as excellent, as the majority are long-term investors (64%) and institutional investment funds (27%).

The strong Greek interest in placement in the National Bank led to a modification of the allocation rates and finally 20% of the total shares for sale were allocated to the Greek market, instead of the 15% that was originally planned. With a total price of 1.067 billion euros and a final price per share of 5.30 euros, the disinvestment of the HFSF by National Bank, is the largest privatization transaction in recent years in Greece through a secondary placement of shares, as the total coverage moved to significantly higher levels .

Alpha Bank: It became 100% private again with the entry of a first-line strategic investor

In mid-November, the bank’s managing director, Vassilis Psaltis, described the entry of a first-line strategic investor – UniCredit – as a historic milestone in the long history of Alpha Bank. The entry of the French company into Alpha Bank resulted in the bank becoming 100% private again. The HFSF accepted in mid-November UniCredit’s binding offer for the acquisition of the Fund’s entire participation, amounting to 8.9781%, in Alpha Bank. This is how the first – with the participation of a new investor – full privatization in the domestic banking sector was completed, in the context of the disinvestment of the HFSF, and Alpha Bank becomes the only Greek bank with the participation of a strategic partner in its share capital.

The acquisition by UniCredit of the percentage held by the HFSF in Alpha Bank, was one of the three pillars of the strategic cooperation announced by the heads of the two groups. The other two were the merger of their subsidiaries in Romania, which will create the 3rd largest bank in the Romanian market, and commercial cooperation through a joint venture to market portfolio management and life insurance products.

Eurobank was the first systemic bank from which the HFSF disinvested

Eurobank was the first systemic bank from which the HFSF disinvested in the first ten days of October 2023 with the completion of the process of repurchasing 1.4% of the share capital from the bank itself. In his statements, the managing director of Eurobank, Fokionas Karavias, had pointed out that Eurobank was the first systemic bank to return purely to the private sector. With this development, as Mr. Karavias pointed out, two circles concerning Greece and the bank were closed. It took more than a decade, when the fiscal crisis turned into a financial crisis and led to the first bank recapitalization, for one of the four systemic banks to zero out the State’s participation in its share capital. This is a strong signal in every direction – to our partners, to the markets and the international investment community – F. Karavias pointed out in his statements. He also stated that this development opened the cycle of freeing Greek banks from the heavy legacy of the crisis.

What does the divestment from Piraeus Bank signify?

The success of the disposal of the percentage of the HFSF shares (27%) can now be recorded as a reference point for both Greek and European data, according to sources close to the HFSF. The total amount collected in the international and Greek book amounted to a total of 10.7 billion euros and in fact in the maximum price range that had been set at 4 euros.

According to the same sources, the Greek economy not only demonstrates the dynamics it is developing, with most of the indicators being the most positive of the corresponding European countries, but also its return in an extremely resounding way to the center of international investment interest, since it has the most successful disposition to present shares through a Public Offering (THS in Piraeus) at pan-European level. At the same time, the largest privatization in history is recorded through a secondary placement, with the amount of the price reaching 1.35 billion euros.

The disinvestment of the HFSF from its participation in Piraeus is the only one at the European level among corresponding placements that managed to attract a premium compared to other corresponding European ones that were all made available at a discount. Indicatively, it is mentioned that the disinvestment of the HFSF by Piraeus Bank is the third European privatization of more than 1 billion euros carried out through a Public Offer since 2017 and the first largest in Greece.

The first largest privatization was a share offering by the Irish government which sold its 29% stake in AIB for €3.4 billion at a 43% discount to the offering price, while until recently the second largest European privatization was the of the 22% share held by the HFSF in National Bank for approximately 1.1 billion euros, which was actually achieved by minimizing the discount on the sale price, to 2.57%.

After 10 years of continuous efforts, according to the same sources, the banking system with the decisive contribution of the HFSF is returning absolutely dynamically to the position it deserves, claiming its further development. The positive effects on all aspects of the country’s economy are also evident, since its already proven investability creates important new opportunities for development.