Greek banks to fol­low sov­er­eign

Kathimerini English - - Focus -

LON­DON (IFR) – Greek banks are pre­par­ing to re­turn to the Euro­pean bond mar­ket, rid­ing on the coat­tails of the sov­er­eign that this week sold its first euro bench­mark in three years. The coun­try’s bank­ing sec­tor is des­per­ate to wean it­self off the emer­gency liq­uid­ity as­sis­tance on which it has been de­pen­dent since 2015. There is prece­dent for the sov­er­eign smooth­ing the way for its banks – the four largest Greek banks sold a com­bined 2.25 bil­lion eu­ros of se­nior un­se­cured debt around the time of Greece’s 3-bil­lion-euro, 4.75 per­cent fiveyear pa­per in April 2014. “You clearly have a sit­u­a­tion where Greece is back in the cap­i­tal mar­kets, and the banks have no [out­stand­ing bonds],” said Louis Gar­gour, chief in­vest­ment of­fi­cer at LNG Cap­i­tal. “That is un­usual to say the least, and that is also not sus­tain­able – you want to have a capi- tal struc­ture; you can’t just have eq­uity. So it’s only a mat­ter of time be­fore the banks is­sue debt.” Bond­hold­ers were asked to swap their debt into eq­uity to help plug a com­bined 14.4-bil­lion-euro cap­i­tal hole across the four largest banks in 2015 as the lenders crum­bled un­der an ex­o­dus of de­posits and a spike in bad loans. Bankers admit in­ter­est in Greek pa­per is so far con­cen­trated among hedge funds, but say that it is im­prov­ing. The re­turn of the sov­er­eign sent a very pos­i­tive sig­nal, said Dim­itris Niko­los, head of in­vestor re­la­tions at Eurobank. “It’s not a se­cret that we would like to be in the mar­kets as well,” he told IFR. The is­suer hopes to re­turn this year with ei­ther a small se­nior un­se­cured or cov­ered bond is­sue, de­pend­ing on the price dif­fer­en­tial. “In the past we had a very com­pre­hen­sive, de­vel­oped, diver­si­fied fund­ing pro­gram, with ABS, RMBS bonds, se­nior debt, Tier 2, etc,” Niko­los said. “We would like to go back to that.” Eurobank is not the

Thri­a­sio in­ter­est. Ma­jor Greek and for­eign com­pa­nies have ex­pressed a for­mal in­ter­est in the long-term lease of spa­ces at the Thri­a­sio Freight Cen­ter, Vrasi­das Zavras, the CEO of ETBA VIPE, which will de­velop the plot in western At­tica, told Kathimerini. He added that the 600,000 sq.m. fa­cil­i­ties will be handed over by fall.

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